Jaydee
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A fair observation, it is illiquid compared to ES, Bund and Eurostoxx. The S&P is the largest index in the World, the German 10 year is the most important debt instrument in Europe and the Eurostoxx is the benchark index for the whole of Europe. Comparatively, the FTSE isn't too important relative to these.
Question is do people want to trade an an illiquid market? It's easily open to traders with lots of leverage to spike levels, stops, etc.
I had always thought about trading the Eurostoxx but it doesn't move much.
Bang for the buck only seems to be in FX, ES, or Bunds...
No, perhaps not in monetary terms but in numbers of contracts on the futures, I was surprised.
ES, for example, is $100k x the index price at each level?
Jaydee
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Yeah, the ES is super liquid - currently about $12m on a single level.
I just meant that the FTSE wouldn't be regarded as illiquid - it's more of a mid-liquidity index future (if there is such a thing, but you know what I mean). If you want to have a look at an illiquid index future, try the BEL 30
You are going to get spiked and whipsawed in Index Futures that have less liquidity obviously, but then you have the issue of liquid futures not moving very much. You can only combat this issue with correctly sizing and choosing a suitable time frame. Remember, a large firm that wants to hedge it's UK exposure to a fall will think nothing of smashing through a few price levels on the FTSE when their time horizon is 5 years - 10 ticks means nothing to them.
I just meant that the FTSE wouldn't be regarded as illiquid - it's more of a mid-liquidity index future (if there is such a thing, but you know what I mean). If you want to have a look at an illiquid index future, try the BEL 30
You are going to get spiked and whipsawed in Index Futures that have less liquidity obviously, but then you have the issue of liquid futures not moving very much. You can only combat this issue with correctly sizing and choosing a suitable time frame. Remember, a large firm that wants to hedge it's UK exposure to a fall will think nothing of smashing through a few price levels on the FTSE when their time horizon is 5 years - 10 ticks means nothing to them.
tar
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The problem with the ES is the spread 0.25 points without commission which is a rip off for scalping and daytrading , compared to these days ATR ...
Every market has at least a 1 tick spread, you can use limit orders to play this away.
I've always wondered why there had to be a spread, must be something to do with the market makers. You;d expect the spread to be at zero at least some of the time in a real market and it never seems to be - that's with DMA access.
Why would you expect a zero spread? Market makers want to be compensated.
tar
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no problem of course there should be a spread but if u compare ES tick to the ATR it is not worth scalping it it is expensive , because of this u c 1000 lots waiting ...
@ limit orders : if i want to use limit orders to scalp , i will do it with STIR and not the ES ...
Exactly, without the market makers someone would offer the same as the bidders at some point. The market makers through their supposed increase of liquidity cause that, some algo immediately switches the offers and bids when they need to be. I suppose it has benefits for liquidity that weren't there many years back but still...
tar
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i mean if i want to use limit orders to earn the spread i will do it with STIR and not the es , the daily range is tighter and limit orders is easier to manage with STIR compared to the ES ...
There's more to volume that DOM.
The FTSE average volume (I think) is about 70,000, that's good volume, assuming under 50 lot clips which 99% of traders here, including my goodself, aren't trading.
Having said that 70,000 average in relation ot the total cap of the FTSE 100 index is pretty pathetic. But options on UK stocks are even worse, that market is micky mouse re volumes.
The FTSE average volume (I think) is about 70,000, that's good volume, assuming under 50 lot clips which 99% of traders here, including my goodself, aren't trading.
Having said that 70,000 average in relation ot the total cap of the FTSE 100 index is pretty pathetic. But options on UK stocks are even worse, that market is micky mouse re volumes.
arabianights
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wtf are you talking about
If someone offers the same as the bid then they trade
The point I was trying to make, admittedly badly worded was that I would expect to see the bid and the ask at the same price but they never seem to be on the ES. They are always 1 tick apart.
The issue is more that someone with a lot of dosh could move the market by quite a few ticks, it's easier to stop hunt on the FTSE than some other contracts it would seem?
arabianights
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The bid and ask cannot be at the same price because they would trade... how hard is this to understand? If it's 1303.50 bid on the ES and I offer 1303.50 I am immediately filled by the bid...
That's how order driven markets work
but you'd expect to see it flash at the same level for a moment wouldn't you?
Say 2000 bid at 1300 but only 1000 offered at 1300.
Shouldn't the bid ask flash up at the same level for a bit until all the orders in the queue had been filled and move to 1 tick apart again?
eg Say the 1000 were all at 1300.25 and they were all dropped to 1300 at the same time.
