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RT's,
It was very interesting watching the last couple weeks from a discount futures broker's point of view. The following are some things I observed as well as some opinions I formed.
90% of our index customers did not trade on Black Monday II. Only two made money. None participated in Wed.'s comeback.
Over the last month or two every public S&P system I have seen has blown up. It is amazing to me that people really believe they can buy a system flaunting outrageous hypothetical returns and make $ with it.
In my opinion the E-Mini is a suckers game. In order to get filled you have to get the bid\offer off the Globex terminal and give up 25 or 50 pts, which takes too long. And of course the commission will eat you alive. For most brokers this contract is a dream come true, a commission machine with a low multiple so the market won't hurt them too much.
The Dow Futures and Options also have a low multiple but the pit clerks and brokers are doing a great job. You can get a real bid-offer as well as a feel for the "size" in the pit. Also, I read in R.T. a post that said the volume in Dow options was 50k. If that is true, it's amazing.
I have gotten some good traders lately who took the R.S. of Houston course. I got a chance to speak to him recently and came away impressed. If people are looking to spend some $ wisely, I recommend him.
I heard that Refco was short 30k S&P Puts and lost over $100 million. I wonder if people really know that these Funds are shorting boatloads of options with unlimited risk. That's ridiculous. Didn't anyone learn from 1987?
Finally, I was appalled at the amount of propaganda being spewed by CNBC during the crash. It seemed like every fifth sentence by "Twitching Terry Keenan" and "Ron I've got hair now Insana" was "but remember, this is only an 11% move - don't panic".
Anyway, I hope I haven't bored or offended too many RT's with this. Last time I posted in R.T. I got some flack so I have kept quiet for a while.
Regards,
RAS Advantage Trading
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