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Ira wrote....
<My objection is to the people who create instruments specifically
designed
to generate income from those who, in most cases, shouldn't be
traeding those
instruments. >
While I enjoy many of Ira's post....this comment just doesn't make any
sense....I heard it a lot when the mini was created........Let me
explain why it bothers me...............
Grains- a one penny move is $50.00 per contract....the mini S&P has an
average daily range of at least twice any of the grains.....Should
everyone stop trading the grains because it has small moves "only
suitable for small traders"?
OJ/Sugar/Cotton/Cocoa...etc......their average daily dollar range is,
also, about half of the mini S&P....Should everyone stop trading them
because they have small daily moves "only suitable for small traders"?
Let's say I have $50,000 dollars worth of some S&P stocks at an
average cost of $5,000......maybe instead of selling them and paying
taxes I would want to hedge a downturn by shorting a mini...thankyou
CME for that opportunity..........
Let's say I shorted a mini at the end of July.....as the market went
my way...I shorted another one....then another one......maybe I only
covered with 100.00 points of profit.....maybe I only made
$10,000-$15,000 in a few months on a mini.....maybe I could have made
$50,000-$75,000 with the big one......Is that a problem? If it
is....it sure sounds like a good one...........
To say these smaller instruments are "created to generate income from
those who shouldn't be trading them" has no foundation......Yes, they
are created to generate income for the exchange, but if the exchanges
don't keep creating products that the public wants....they will soon
be wondering why no one trades cheddar cheese and shrimp
contracts..........
Tom Stein
comfut@xxxxxxx
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