Best Way To Trade INDICES?

[Ultimatus]

I am just starting to learn about all this and have a simple question (I hope!).....

What is the best way for me to trade indices (s&p500, dow, ftse)? I know a little about spread betting but is this the best way to go? What are the other options? I have heard of 'e-minis' and 'contracts' but have no idea about what they are.

I am obviously looking for the cheapest option in terms of commission and tax.

I have tried looking around the site but can't find anything on this particular subject......any help would be much appreciated, thanks.

 

[gedward3]

I am just starting to learn about all this and have a simple question (I hope!).....

What is the best way for me to trade indices (s&p500, dow, ftse)? I know a little about spread betting but is this the best way to go? What are the other options? I have heard of 'e-minis' and 'contracts' but have no idea about what they are.

I am obviously looking for the cheapest option in terms of commission and tax.

I have tried looking around the site but can't find anything on this particular subject......any help would be much appreciated, thanks.

Ultimatus,

Most people on the site have lurked for months or years as there is so much information
in the Forums section up at the top. You can also use the search facility as well but to be honest it confuses me at the best of times. There is a page somewhere that tells you how to use it but i can never be bothered.

Ged

 

[tomorton]

Hi Ulitimatus - In general, index trading has advantages over equity trading - clear TA based on massive volumes, no sudden shocks due to a competitor's new product, no need to get into detailed analysis of annual reports etc.. Of course equities offer greater volatility and the possibilities of exceptional gains if you're tradng something with unexpected good/bad results, takeover targets etc.

SB-ing indices is easy and spread costs are low if you're working on a swing / position trading basis, but prohibitively expensive if you're going to scalp or daytrade. SB quotes are also sometimes well detached from the underlying market, always it seems to the advantage of the SB firm. Don't rely on their charts as your source of TA.

There are specific threads on T2W on tradng the FTSE, Dow etc. specifically with some very expert specialists willing to hand out advice.

Good luck.

 

[Ultimatus]

Hi tomorton,

The reason I am asking is I have been trading indices using spread betting but as you say the prices are different to the underlying market.

I want to daytrade so want market prices .

What I really want is a package that has charting, real time prices, level 2 and broker all in one! I am in the UK, can anyone recommend anything? I am using ADVFN and CMC spread betting, but this really is no good for daytrading.

After doing a bit more research it looks like I should be trading Eminis, how does this work out for tax and commisions etc?

Any help would be great! Thanks guys.

 

[astoria]

It seems you are starting from the bottom floor ...so the best thing is do some reading...to undertand what E- mini and other similar products are go to the Chicago Mercantile Exchange site...that would be a very good place to start your trading journey....

Please do not rush into trading...