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Hi guys,
Are there any Futures day traders on the group?
Well, I am. I started day-trading this year, with some years
of general experience as a futures trader, on and off ( not
on a regular basis ).
We as day traders know ( or at least have heard ) of possible
markets to day-trade : S&P500 ( the big boy ), Swiss Franc,
Pork Bellies ( that demon ! ), Soybeans, Coffee, to mention some.
Trying to find out a way to see, from a pure math point of view,
I did some research, which, in a general way, displays a scenario
on how some markets stand for day-trading purposes.
Attached is a table showing the results of this research.
I have traded those markets, with the exception of the S&P500.
I included the spooz (S&P) because it's believed to be one of the
best suitable for day-trading. Unfortunately I didn't have more
recent data, so those figures for the S&P are for the Dec 94
contract.
What I call by system is, making 5 trades per week, 3 of them were
profitable, 2 were losing trades. That's what "accuracy" means,
not a methodology applied for trading.
To go with an example, let's take P Bellies.
"Req'd. Daily Range : 152 points." - To make a $750 profit per
week, trading one contract per day ( 5 trades/wk ),Bellies has
to have a daily range ( on average ) of 152 pts.
Since PB has an avge.daily range of 162.2 pts., this goal is
attainable, under the considerations shown : 3 winn. trades,
2 losing trades, comm & fees = $25/trade, profit range of
70 % ( .7 x 152 = 106 pts ).
"Net weekly profit made : $ 837" - profit made per week
on Bellies during the testing period ( 155 days or 31 trading
weeks ) based on the Avge. daily range ( real ),again,
applying those considerations under the table.
"Max reaction at Open : 259 pts" - This was the max movement
PB made going against the general trend for the day. That was
a very volatile day. The average reaction for PB is 35 points.
According to the table, Corn is a poor candidate for day-
trading, even though it's a very liquid market ( open interest
sometimes over 100,000 during the last two or three months
of a contract ). An option could be to place several trades
during the day .
To me, being a little guy ( I can't play with the big boy
for now ), the best bets would be : PORK BELLIES ( not very
liquid ), SOYBEANS AND THE SWISS FRANC ( TRENDY ).
If you had problems viewing the table, email me a note and I
can try another format.
Note : One important thing not considered here was SLIPPAGE.
Any comments (pro or against) will be appreciated.
Regards,
Efrain R Portales
efrain12@xxxxxxxxxxxx
Attachment Converted: "c:\eudora\attach\Markets to day - trade..doc"
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