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I think this makes an excellent point: there are times to trade the S&P and
there are times to stand aside while trading something else. I'm relatively risk
adverse and while I use leverage, each of my trades are built in a manner which
limits risk at 2%+- of the account. At any particular time, there are futures
which can be position or day traded with reasonable risk and provide nice
returns - I refer to these as my bread and butter trades. Then there is the S&P,
which with its big moves, can provide champagne and caviar or send one to the
poor house. I generally day trade the S&P, rather than position trade, because
eliminating the overnight risk allows me to trade larger size for my risk limit.
However I won't even day trade the S&P if it's so choppy that it won't hold
channels, retracements and projections on a 30 minute chart. That's when it's
really nice to have those other trades to put bread and butter on the table.
Earl
>It has been my experience that many S&P 500 traders will trade
>successfully for awhile, and then you get a abnormal day and they give a
>couple years of gains back.
>
>I would encourage you to look at the other futures markets. Now I agree
>that most physical markets are in the doldrums (strong dollar?) but
>crude oil is a good recent example of bringing the leverage issue under
>control. In the last week crude is down over $3.00 per barrel (closer to
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