FTSE100 Daily / FTSE100 Daily Future

[RedGreenBen]

I'm new to trading anything but forex (much easier to visualise... just big virtual piles of virtual cash) and am dipping my toes in the world of indices and more specifically FTSE100 via spread-betting.

What is the difference between trading the FTSE100 Daily and FTSE100 Daily *Future*. I understand what the future is, why is it a different value etc but don't see the relative merits of each (same spreads etc). Any clarification gratefully received.

My second question - which is either stupid or beautifully subtle - is how much of the price of the index is determined by the trade in the index itself and how much by the action in the 100(+2) components?

Thanks in advance (and hopefully not as inadvertently contentious as my last post http://www.trade2win.com/boards/general-trading-chat/29527-zero-sum-games.html ).

RGB.

 

[barjon]

hi, red

the ftse100 index itself cannot be directly traded, unlike the futures which can be.

thus the ftse100 index does not have a "price" and it represents a composite of the price action in its components. the price action of those components is influenced by what is happening to the futures.

sb companies allow you to bet on both, but you are not trading them in the real market - just against the derivative versions created by the sb companies themselves.

cheers

jon

 

[theroguetrader]

I'm new to trading anything but forex (much easier to visualise... just big virtual piles of virtual cash) and am dipping my toes in the world of indices and more specifically FTSE100 via spread-betting.

What is the difference between trading the FTSE100 Daily and FTSE100 Daily *Future*. I understand what the future is, why is it a different value etc but don't see the relative merits of each (same spreads etc). Any clarification gratefully received.

My second question - which is either stupid or beautifully subtle - is how much of the price of the index is determined by the trade in the index itself and how much by the action in the 100(+2) components?

Thanks in advance (and hopefully not as inadvertently contentious as my last post http://www.trade2win.com/boards/general-trading-chat/29527-zero-sum-games.html ).

RGB.

Hope this helps - just try and think of the FUTURES price as being AHEAD of the CASH price for the same instrument - (doesnt matter what it is) -

The amount by which a FUTURE exceeds the ACTUAL cash price is called the Premium to Cash... !!
If your trading INTRA DAY - MAKE SURE your trading off the CORRECT chart in the CORRECT time frame....... !!


2) PRICE is ALL that matters - !!

 

[spanish89]

I'm new to trading anything but forex (much easier to visualise... just big virtual piles of virtual cash) and am dipping my toes in the world of indices and more specifically FTSE100 via spread-betting.

What is the difference between trading the FTSE100 Daily and FTSE100 Daily *Future*. I understand what the future is, why is it a different value etc but don't see the relative merits of each (same spreads etc). Any clarification gratefully received.

My second question - which is either stupid or beautifully subtle - is how much of the price of the index is determined by the trade in the index itself and how much by the action in the 100(+2) components?

Thanks in advance (and hopefully not as inadvertently contentious as my last post http://www.trade2win.com/boards/general-trading-chat/29527-zero-sum-games.html ).

RGB.

Aloha mate,
I focus 90% on ftse 100 day trading, but also like to cash in on scalping the down for a few minutes and cash in even more going long on oil!!

I never understood the difference between daily cash and daily future, although if you check under my username at my posts i have created one asking for the difference and have had a few answers but in rather complicated language.. LOL


If you want any tips or to share research resources on the Ftse 100 (next day pre-open future trading) then im happy to chat.

 

[hithere2]

Barjon explained it just as it is. SB companies give you a price between futures and cash the alternative is trading the futures.

I'm new to trading anything but forex (much easier to visualise... just big virtual piles of virtual cash) and am dipping my toes in the world of indices and more specifically FTSE100 via spread-betting.

What is the difference between trading the FTSE100 Daily and FTSE100 Daily *Future*. I understand what the future is, why is it a different value etc but don't see the relative merits of each (same spreads etc). Any clarification gratefully received.

My second question - which is either stupid or beautifully subtle - is how much of the price of the index is determined by the trade in the index itself and how much by the action in the 100(+2) components?

Thanks in advance (and hopefully not as inadvertently contentious as my last post http://www.trade2win.com/boards/general-trading-chat/29527-zero-sum-games.html ).

RGB.

 

[SuddenDeath]

Futures price /cash price difference

Cash price 6000
Cost of carry (6%/4) 90
--------
6090
Less dividends (45)
---------
Futures price 6045

preimum to cash 45pts

this is approximation of a future with 3 months to run and dividends being spread evenly through the year

if the futures price did not trade at premium to cash everyone would own the future since u would get the same return as the cash but using only £4k margin instead of £60k for holding the cash. the futures does not recieve dividends so thats deducted after adding the interest saving.

the spread diminshes as the number of days to expiry decline. and as ftse100 stocks go ex divi on wednesdays

 

[seguna]

Well done all. Useful answers.

Does anyone know where you can get free charts of the FTSE100 Index future on an intraday basis?

Secondly, since the FTSE100 closes at 5:30pm UK time, where do the SB companies get the underlying price from which they quote FTSE100 Daily cash after the normal trading hours???

:whistling