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I agree with your risk/reward approach. I figure that a strong trend
happens between 1 and 4 times per year (eg: Nov/Dec 2004). I don't
really want to trade futures directionally outside of those trends
(would rather be selling option premium on the DJX/XEO/SPX in a choppy
market).
--- In equismetastock@xxxxxxxxxxxxxxx, "formulaprimer"
<formulaprimer@xxxx> wrote:
> One more thing. I trade between 1-100 contracts sizes of the dow
> mini's. The maximum position one could hold on the minis before
> having to declare is 2500 contracts or it could be doubled to 5000
> contracts I haven't checked recently. So it is pretty broad. I still
> use the same money management plan.
> KS.
> example: with 1 lot I test the trend and will handle a $250.00 loss.
> With a major trend I will enter 100 lot and will suffer a $25,000.00
> draw down with a profit to reward ratio of 3:1. I will never enter a
> large position trade without a 3:1 risk to reward ratio. Basically
> if i risk $25,000.00 I must return $75,000.00 in profit. Keep in
> mind major trend trades happen a several times a year.
> KS.
>
>
> --- In equismetastock@xxxxxxxxxxxxxxx, "formulaprimer"
> <formulaprimer@xxxx> wrote:
> > The funds move the market and the commercials hedge the market.
> The
> > big money is made by the funds and they trade the Big Board. The
> > mini has too many artificial spikes from overnight trading or
> small
> > lot traders getting overdone in a situation. Basically the Big
> Board
> > is a more technically sound chart. This is always the case.
> > KS.
> >
> >
> > --- In equismetastock@xxxxxxxxxxxxxxx, "metastkuser"
> > <andysmith_999@xxxx> wrote:
> > > KS, one more: Why not chart the minis? Why trade by the Big
> > Contracts
> > > and enter in the mini contracts?
> > >
> > > Thanks!
> > >
> > >
> > >
> > > --- In equismetastock@xxxxxxxxxxxxxxx, "formulaprimer"
> > > <formulaprimer@xxxx> wrote:
> > > > I think the dow mini is $5 a point and and the full dow future
> > > > contract is 10$ a point. That is what i go on. 1% of of my
> > initial
> > > > margin of $2500 is $25 dollars which is 5 points. This is of
> > course
> > > > when I do random entry technique. Other wise from my
> experience
> > if
> > > > the dow moves more than 50 points against me I usually get
> out.
> > That
> > > > is just my experience but it could be different for others.
> > > > KS.
> > > >
> > > > --- In equismetastock@xxxxxxxxxxxxxxx, "metastkuser"
> > > > <andysmith_999@xxxx> wrote:
> > > > > <formulaprimer@xxxx> wrote:
> > > > > > I trade daily, intraday, or position depending on how the
> > charts
> > > > > > look. The reason I say "no sleep" is that I don't put
> stops
> > in
> > > > > > because all electronic orders can be viewed by other
> traders
> > > > because
> > > > > > the real time quotes puts them up for everybody to see.
> This
> > > > means
> > > > > > that stops will get picked off. You will experience this
> for
> > > > > > yourself, when it goes down to hit your stop and then
> > proceeds
> > > > to go
> > > > > > back up again. Since it is electronic it means
> > instantaneous
> > > > fills
> > > > > > or close to it. When the price hits my loss target I put
> > the
> > > > order
> > > > > > in at the market, This is the stop process the Turtles
> made
> > > > famous
> > > > > > and is probably the only thing that is useful from what
> they
> > > > > > originally did.
> > > > >
> > > > > KS, doesn't hiding your stops only matter if you are trading
> > very
> > > > > large positions? Also if you are using wider stops in the
> case
> > of
> > > > > position trading (say 2 ATRs) then is getting your stops
> > picked off
> > > > > still a problem, given the wider stops?
> > > > >
> > > > > >Of course I'm referring to electronic markets of dow
> > > > > > mini and others. I do not trade the pit contracts unless
> I'm
> > > > > > position trading even then I prefer the electronic. The
> > > > leverage or
> > > > > > granularity you talk about is only relevant if you talk
> > about
> > > > risk.
> > > > > > The higher the point value the greater the risk to reward
> > ratio.
> > > > If
> > > > > > you are beginning i would recommend the dow mini contract.
> > $5
> > > > > > dollars a point and $2500.00 a contract. Volatility meters
> > and
> > > > price
> > > > > > range can help with money management portion of the
> trading.
> > The
> > > > Dow
> > > > > > market are the easiest to trade because they trade in a
> > range
> > > > bound
> > > > > > pattern. Take a look at a historical chart of the dow
> > futures
> > > > > > contract. Do not chart the mini. Trade by the Big
> Contracts
> > and
> > > > > > enter in the mini contracts.
> > > > >
> > > > > This is a big disconnect for me. Why trade by the Big
> > Contracts and
> > > > > enter in the mini contracts? Why not chart the minis?
> > > > >
> > > > > > (example of my last trade would be: I shorted the mini sep
> > dow
> > > > at
> > > > > > 10700 with a target stop loss of 50 points or $250.00 and
> it
> > > > went to
> > > > > > 10734 and collapsed to 10580 which then I exited at the
> > market
> > > > > > because it hit trend line support. I checked the stop
> orders
> > > > place
> > > > > > at the time the market went to 10734 and the last stop
> order
> > was
> > > > at
> > > > > > that price 10734, then the market collapsed. So the
> > reasoning is
> > > > > > that if I could see it the big leverage players will move
> > the
> > > > market
> > > > > > to pick off the buy stop and let the market go down to its
> > > > proper
> > > > > > trend.
> > > > >
> > > > > I see your point. Again, if 10734 was for a small number of
> > > > contracts,
> > > > > the big players may not have walked the index up there to
> take
> > out
> > > > a
> > > > > few contracts... but who knows. Your example uses a 50 point
> > stop.
> > > > 1
> > > > > ATR is around 95 points, so if this was a position trade,
> > isn't the
> > > > > stop a bit tight?
> > > > >
> > > > > >My stop method is from years of experience in this market
> > > > > > and requires the ability to immediately exit a trade when
> > the
> > > > target
> > > > > > stop loss is hit. It does not matter if it goes back down.
> > You
> > > > get
> > > > > > out. Any change in this money management technique will
> > cause
> > > > losses.
> > > > >
> > > > > Yes, I understand, discipline.
> > > > >
> > > > > > One quick note : I tested with real money with a coin
> flip.
> > I
> > > > > > entered long if it is heads and short if it is tails. I
> put
> > the
> > > > stop
> > > > > > loss at 1% or $25.00 or 5 ticks.
> > > > >
> > > > > I don't follow. 5 ticks is 0.05% of the Dow (5/10000). How
> do
> > you
> > > > get 1%?
> > > > >
> > > > > > With this money management
> > > > > > technique I was profitable. Basically random entry into
> the
> > > > market
> > > > > > with a proper money management system made it profitable.
> > > > Trading
> > > > > > is 90% money management 10% technical. I use to think it
> was
> > the
> > > > > > other way around but it took awhile to figure this out.
> > > > >
> > > > > I completely agree. THanks so much for your comments, KS.
> > > > >
> > > > > > KS.
> > > > > >
> > > > > >
> > > > > >
> > > > > > --- In equismetastock@xxxxxxxxxxxxxxx, "metastkuser"
> > > > > > <andysmith_999@xxxx> wrote:
> > > > > > > KS,
> > > > > > >
> > > > > > > If you don't mind a few questions:
> > > > > > >
> > > > > > > 1) Do you daytrade ES and YM or trade multi-day?
> > > > > > >
> > > > > > > 2) Do you see any benefit from the added granularity of
> YM
> > > > over ES
> > > > > > > (i.e. YM tick is $1, ES tick is $0.25, but YM is 10x ES
> > which
> > > > means
> > > > > > > ES=$0.25 and YM=$0.10 in apples-to-apples). Does YM's
> finer
> > > > > > > granularity allow your stops to be shaken out less?
> > > > > > >
> > > > > > > 3) Leveraging cuts both ways, but e-mini traders only
> > speak of
> > > > it's
> > > > > > > goodness (as you are confirming). Why is that? Have you
> > never
> > > > been
> > > > > > > hurt by the high leverage?
> > > > > > >
> > > > > > > 4) "Sleep is not an option because of night trading".
> I'm
> > > > assuming
> > > > > > > vigilant stop placement for ES/YM end-of-day traders
> > allows
> > > > for
> > > > > > sleep?
> > > > > > >
> > > > > > > Thank you for your help, KS.
> > > > > > > Andy.
> > > > > > >
> > > > > > >
> > > > > > > --- In equismetastock@xxxxxxxxxxxxxxx, "formulaprimer"
> > > > > > > <formulaprimer@xxxx> wrote:
> > > > > > > > I can't speak for anybody else but I have been trading
> > the
> > > > Dow
> > > > > > > > Futures and Dow Mini and S&P mini since it began. Once
> > you
> > > > trade
> > > > > > > > them you will never go back to stocks. It is because
> of
> > the
> > > > > > > > leveraging. All the indexes move in direct relation
> to
> > the
> > > > > > Stock
> > > > > > > > Market indexes so any long term direction must be done
> > with
> > > > the
> > > > > > Big
> > > > > > > > Board not the mini's. Be warned the Night Trading
> moves
> > the
> > > > > > market
> > > > > > > > tremendously sometimes and sometimes sleep is not an
> > option.
> > > > > > > > Otherwise if your technical analysis is at a high
> level
> > you
> > > > will
> > > > > > > > like it. August issue of Futures magazine I think has
> a
> > good
> > > > > > article
> > > > > > > > on options.
> > > > > > > > KS.
> > > > > > > >
> > > > > > > >
> > > > > > > > --- In equismetastock@xxxxxxxxxxxxxxx, "metastkuser"
> > > > > > > > <andysmith_999@xxxx> wrote:
> > > > > > > > > Vladimir,
> > > > > > > > >
> > > > > > > > > Thank you for taking the time to answer my
> questions.
> > > > > > > > >
> > > > > > > > > In your experience, how would you compare trading
> the
> > > > index
> > > > > > versus
> > > > > > > > > trading the futures? For example, trading ES vs.
> SPX,
> > or
> > > > NQ vs.
> > > > > > > > > QQQQ,... I know the leverage is very different, but
> > > > besides
> > > > > > that
> > > > > > > > how
> > > > > > > > > has your experience been?
> > > > > > > > >
> > > > > > > > > I have heard that once a trader moves from
> > stocks/indexes
> > > > to
> > > > > > > > futures,
> > > > > > > > > they never return to stocks...
> > > > > > > > >
> > > > > > > > >
> > > > > > > > > --- In equismetastock@xxxxxxxxxxxxxxx, "v"
> > <entinv@xxxx>
> > > > wrote:
> > > > > > > > > > From my experience future always track the index.
> > For
> > > > > > example
> > > > > > > > > either you
> > > > > > > > > > trade QQQQ or NQ
> > > > > > > > > > the only real difference is the leverage.
> > > > > > > > > >
> > > > > > > > > > Comparing futures to equities if you mean
> individual
> > > > stocks,
> > > > > > the
> > > > > > > > future
> > > > > > > > > > never goes bankrupt therefore it's
> > > > > > > > > > safer to buy. Futures, both commodities and
> indexes
> > > > appear
> > > > > > to
> > > > > > > > > better comply
> > > > > > > > > > with the technical analysis
> > > > > > > > > > studies in comparison with individual stocks.
> Many
> > > > > > individual
> > > > > > > > > stocks are
> > > > > > > > > > not liquid enough to trade and
> > > > > > > > > > those most liquid would track corresponding
> > > > industry/group
> > > > > > > > indexes.
> > > > > > > > > >
> > > > > > > > > > Never heard about Track N TRade before. Looks
> > > > interesting
> > > > > > > > > >
> > > > > > > > > >
> > > > > > > > > > -----Original Message-----
> > > > > > > > > > From: equismetastock@xxxxxxxxxxxxxxx
> > > > > > > > > > [mailto:equismetastock@xxxxxxxxxxxxxxx]On Behalf
> Of
> > > > > > metastkuser
> > > > > > > > > > Sent: Saturday, August 20, 2005 11:56 PM
> > > > > > > > > > To: equismetastock@xxxxxxxxxxxxxxx
> > > > > > > > > > Subject: Re: [EquisMetaStock Group] Using
> > Metastock to
> > > > > > trade
> > > > > > > > FUTURES?
> > > > > > > > > >
> > > > > > > > > >
> > > > > > > > > > Vladimir,
> > > > > > > > > >
> > > > > > > > > > "It doesn't provide continuous contracts, but
> for
> > ES
> > > > and
> > > > > > YM
> > > > > > > > you can
> > > > > > > > > > use SPY/SPX and DIA/DJI if you need longer term
> > > > picture."
> > > > > > > > > > -- yes, it occured to me that I can use SPX
> > instead
> > > > of
> > > > > > ES,
> > > > > > > > and DIA
> > > > > > > > > > instead of YM. But, does the future always track
> > the
> > > > > > index?
> > > > > > > > Wouldn't
> > > > > > > > > > the future move much faster than the index if
> the
> > > > index
> > > > > > made a
> > > > > > > > sudden
> > > > > > > > > > large move?
> > > > > > > > > >
> > > > > > > > > > How do you like trading futures compared to
> > equities?
> > > > > > > > > >
> > > > > > > > > > By the way, have you heard of Track N Trade for
> > > > > > backtesting
> > > > > > > > futures?
> > > > > > > > > >
> > > > > > > > > > --- In equismetastock@xxxxxxxxxxxxxxx, "v"
> > > > <entinv@xxxx>
> > > > > > wrote:
> > > > > > > > > > > For EOD futures I'm using HSQuote from
> > > > > > > > > > >
> > > > http://www.downloadjunction.com/product/software/4358/
> > > > > > > > > > > It doesn't provide continuous contracts, but
> for
> > ES
> > > > and
> > > > > > YM
> > > > > > > > you
> > > > > > > > > can use
> > > > > > > > > > > SPY/SPX and DIA/DJI if you
> > > > > > > > > > > need longer term picture.
> > > > > > > > > > > Intraday I'm using MetaServer RT for
> > > > Interactivebrokers.
> > > > > > > > > > >
> > > > > > > > > > > I don't trade options on futures.
> > > > > > > > > > >
> > > > > > > > > > > Regards,
> > > > > > > > > > > Vladimir
> > > > > > > > > > >
> > > > > > > > > > > -----Original Message-----
> > > > > > > > > > > From: equismetastock@xxxxxxxxxxxxxxx
> > > > > > > > > > > [mailto:equismetastock@xxxxxxxxxxxxxxx]On
> Behalf
> > Of
> > > > > > > > metastkuser
> > > > > > > > > > > Sent: Saturday, August 20, 2005 8:18 PM
> > > > > > > > > > > To: equismetastock@xxxxxxxxxxxxxxx
> > > > > > > > > > > Subject: Re: [EquisMetaStock Group] Using
> > > > Metastock to
> > > > > > > > trade
> > > > > > > > > FUTURES?
> > > > > > > > > > >
> > > > > > > > > > >
> > > > > > > > > > > Vladimir,
> > > > > > > > > > >
> > > > > > > > > > > If you don't mind answering a couple of
> > questions:
> > > > > > > > > > >
> > > > > > > > > > > 1) I'm only interested in S&P 500 e-mini
> (ES)
> > and
> > > > mini-
> > > > > > Dow
> > > > > > > > > (YM). I use
> > > > > > > > > > > Reuters for stock/indices end-of-day data. I
> > don't
> > > > > > want to
> > > > > > > > pay
> > > > > > > > > for the
> > > > > > > > > > > omplete futures eod package. Do you know
> where
> > I
> > > > can
> > > > > > get
> > > > > > > > eod
> > > > > > > > > data for
> > > > > > > > > > > just ES and YM?
> > > > > > > > > > >
> > > > > > > > > > > 2) Options on futures. I currently trade
> > options
> > > > credit
> > > > > > > > > spreads on SPX
> > > > > > > > > > > and would like to try credit spreads on ES
> and
> > YM.
> > > > Do
> > > > > > you
> > > > > > > > trade
> > > > > > > > > > > options on futures? Can Metastock support
> this?
> > > > > > > > > > >
> > > > > > > > > > >
> > > > > > > > > > > --- In equismetastock@xxxxxxxxxxxxxxx, "v"
> > > > > > <entinv@xxxx>
> > > > > > > > wrote:
> > > > > > > > > > > > Yes, I do.
> > > > > > > > > > > >
> > > > > > > > > > > > Vladimir
> > > > > > > > > > > > -----Original Message-----
> > > > > > > > > > > > From: equismetastock@xxxxxxxxxxxxxxx
> > > > > > > > > > > > [mailto:equismetastock@xxxxxxxxxxxxxxx]On
> > Behalf
> > > > Of
> > > > > > > > metastkuser
> > > > > > > > > > > > Sent: Saturday, August 20, 2005 5:53 PM
> > > > > > > > > > > > To: equismetastock@xxxxxxxxxxxxxxx
> > > > > > > > > > > > Subject: [EquisMetaStock Group] Using
> > > > Metastock to
> > > > > > > > trade
> > > > > > > > > FUTURES?
> > > > > > > > > > > >
> > > > > > > > > > > >
> > > > > > > > > > > > Anyone using MS to trade futures?
> > > > > > > > > > > >
> > > > > > > > > > > >
> > > > > > > > > > > >
> > > > > > > > > > > >
> > > > > > > > > > > > SPONSORED LINKS Business finance course
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