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<DIV
style="BACKGROUND: #e4e4e4; FONT: 10pt arial; font-color: black">From:
ira
To: <A title=realtraders@xxxxxxxxxxxxxxx
href="mailto:realtraders@xxxxxxxxxxxxxxx";>realtraders@xxxxxxxxxxxxxxx
Sent: Thursday, September 19, 2002 5:05
PM
Subject: Re: [RT] Commodities V. Stocks?
Read Whats tradeable?
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Ira: In commodities, the most manipulated markets
are those on the New York exchanges. In fact I stopped trading them
years ago and only do so on special occasions.
NW: There is validity to your point. However, I
have found this to only be a factor if you are doing alot of day trading,
using market orders or stops. If you position trade using limits, you should
not have any problem. I have often gotten fills better than my limits in
NY.
Ira: The higher the volumes and liquidity
the less the chance for manipulation. If you were going to start
trading a commodity I would suggest the bonds, the 10 year Note, or one
of the currencies. Either the Euro or the Yen. Remember that
the most volatility in the currencies can happen at night so there is some
care that has to be taken there.
NW: All the markets you mentioned are subject to
govt. manipulaton. They also tend to be larger dollar items, such as it is
easy to make or lose two to three thousand per contract in Bonds in a day or
two. Currencies can be devalued or revalued overnight. I don't
think this is a good place for a beginner. A good market for a beginner
is a less volatile market such as Corn. One can get a 100+ year
history for corn prices. It seldom moves more than $500 per contract in
day. Even during a big move, it usually has lots of oscillations that allow
one to trade in and out. Corn hours are a sleep friendly 10:30 AM - 2:15
PM ET. Someone just starting can easily put in their orders in the
morning, go do soemthing else, and check this market in the
evening. Sugar is also currently a good market for a beginner, as the
total underlying value is less than $7,000 per contract Once you feel
comforable with a low price low volititiy market such as Corn or Sugar, it is
easy to graduate to the bigger games such as Wheat, Soybeans and the other
commodities. Most commodities are not conducive for day trading and
should only be used as vehicles for taking positions that may
last from several days to several months. Once you have graduated
through some of the wilder commodities, you may consider graduating, if
properly capitalized, to the crazier markets such as Coffee, Bonds, and
S&Ps. Bonds are a good market for trading short term swings because
their short term volatility tends to be disproportiantely high to their longer
term or annual volatility.
Ira: I think that the last place for a
beginner to be is trading the E Mini, DJ $5 contract, NASD mini. they
are great contracts to trade electronically, but not for a beginner or a
novice. Also as you go from the E Mini to the DJ $5 contract to the NASD
mini the spreads get greater and the liquidity gets less. The last thing
you should trade is the S&P futures contract as a beginner. I have
left the grains and meats out as they are still traded on the old pit
basis. They are interesting to trade and far less treacherous then the
NY markets. Remember one thing in trading commodities that they
can change the rules at any time. They can change margin requirements,
They can change whether you can take delivery on a commodity, and almost
anything else they want to for the benefit of the members of the
exchange.
NW: Yes, the house always reserves the right
to change the rules in the middle of the
game in order to save the house. However, this has very seldom happened
and then only during extreme conditions. The US Govt. has also
pulled this same stunt when stability was threatened. So,
don't buy Silver at $52 per ounce, having come from $1.60, or Wheat
at $7 per bushel, having come from $2 per bushel, i.e. all time
historical high prices, and expect to make a fortune. These extremes
potentially threatened the stability of the system aka "the
house" so measures are taken to assure the preservation of the game.
Regards,
Norman
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----- Original Message -----
<DIV
style="BACKGROUND: #e4e4e4; FONT: 10pt arial; font-color: black">From:
Sean
Cassidy
To: <A
title=realtraders@xxxxxxxxxxxxxxx
href="mailto:realtraders@xxxxxxxxxxxxxxx";>realtraders@xxxxxxxxxxxxxxx
Sent: Thursday, September 19, 2002 1:50
PM
Subject: [RT] Commodities V. Stocks?
Read Whats tradeable?
I have heard and.....and it certainly seems
reasonable, that commodities are more likely to follow and trend and are
less manipulated than stocks. This seems to increase the likeliehood of
success tradingh them, is this true?
Or the real question I want to ask, given a
$40,000 account, what asset class that has been discussed here, is the most
"tradeable". This being with a reasonable learning curve.
I would love to have a discussion about this,
im tired of trying to chart the fact that the CEO of the company I own has a
golf course in his bathroom.To unsubscribe from
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