Us Index Trading

[Naz]

US Index Trading

This might help anyone who is thinking of US index trading.

The trouble with spread betting these indices is that you are dealing with third party traders whose objective is to make money for their company.Hence when the index is going up and down they bias the spread accordingly,which is against you.Some say that in quieter moments they will "run" the stops.ie move the spread to take out their customers stops.

I have found that being a Nasdaq trader and having access to island ECN,i'm able to trade these indicies on my level 2 screen by trading the tracking stocks.The codes are

DIA-----for the Dow
SPY-----for the S&P
QQQ----for the Nasdaq

So if i want to trade the Dow i key in DIA. The spread is normaly like this $88.82--88.86. Now if i want to get filled immediately with my direct access i can have 88.86 in the blink of an eye,however if i want to i can enter an order at 88.821 and therefore become best bid and wait to see if someone in the market place will sell to me.If i get filled i've just saved the spread.The opposite happens when you come to sell.
I know Nasdaq traders in this country sitting at home that earn a very good living by doing this with the QQQ (the stock which tracks the Nasdaq 100)

Some traders scalp the indices 6 to 7 times a day(the Nasdaq is easily traded at fibonacci levels) others follow a web site in the US called signalwatch.com.This gives technical analysis commentry on all three indices on a daily basis to help them take larger moves over a number of days.

The US brokerages that dont have a UK, SFA licence are not allowed to advertise here.Thats why we never see any adverts for opening these type of accounts.But you've only got to open a US schwab account(in the US) and ask for level 2 and your in business.
If anyone is going to click events seminar at Guilford University on Oct 13th i shall be demonstrating level 2 and how to use Island with it.I will gladly answer any questions on using it to index trade.I hope all this helps.

Naz

 

[ed crane]

US Index trading

very helpful.....is there anything similar for UK indices where the problem is just the same?

 

[Naz]

As a trader ive always been looking for an edge.Here in the UK i always felt my trading was at a disadvantage.(large spreads,stamp duty,no direct access,difficulty in going short in a standard account and large morning gaps mirroring the US) I wanted a system that gave me a fair crack of the whip.Where i could sink or swim on my trading ability.
Plain competition has given US investors just that.There just arent the range of trading vehicles in the UK that there are in the US.If the UK allowed these guys to advertise here we'd all be able to see the difference.

When i've talked on TV i've been asked can you do that over here.The fact is you probably cant and if you could it would be so well hidden so not many people know about it.

It took courage to start trading the markets use some of that courage to start looking at another market.Soon you find yourself familiar with a whole host of new companies, a massive on- line trading community,new friends across the world and finaly you'll feel that you've just made another step in your trading journey.

 

[ed crane]

US Index trading

i couldn't agree with you more......your comments are so compelling i have wondered for a long time why any of us try to trade the uk market with the odds so stacked against us. in time we will have everything the US has but for the forseeable future..................

are there any particular brokers that you might recommend for these types of trades?

 

[Naz]

There is so much that realy needs to be said,see if you can make clickevents seminar at Guilford University on Oct 13th.I know its booked up but stand at the back.When the event is over the hall is booked for another 5 hours.The cameras will be swithed off and then i can talk OFF the record.I did this at Sharex last year and the Investors Chronicle show and it was a gathering of like minded souls with everybody telling it as it realy is.Powerful stuff.If you trade the markets come and listen.

 

[ChartMan]

NAZ
Click Events has no longer any details re Guildford. Can you post them here as it's only down the road from me in Farnborough.
Cheers

 

[Naz]

Yes Chartman,

The clickevents seminar is being held on Sat 13th Oct in lecture theatre f,University of Guilford.Surrey.It starts at 11am and concludes about 2pm .The room is booked for another 5hrs so there will be time to chat afterwards.I would like to stress that the reason its been taken off the web site is because its fully booked.I'm sure there must be some standing room somewhere.

 

[Naz]

What a run for guys playing the Q's yesterday(QQQ)Nasdaq 100 tracking stock.

Although i was playing VRSN and not looking at tthe index trackers.When the Nasdaq comp went strongly thru 1500(previous resistance) the trader next to me turned to me and told me he'd just bought a shed full of q's in case they run it to 1600.

At the end of the day when it ran to the 1590 area(which we all knew was the 38 % fibonacci retracement level of the last major move down) he told me that he'd cashed out and earn't enough to pay for the family holidays next year.He just took 7% out of the run.

I mentioned before the Naz loves fib levels and Q's players should learn to love them.