What I would like to know, are the eMini S&P and the eMini Nasdaq good as leading indicator for daytrading ? I ask this because I think there might be a lot more noise coming from xxx small private traders and this might not be happening on the real S&P and Nasdaq future. Is the difference worth paying the extra monthly data fee ($10,- for eMini against $60 for the complete CME) Any thoughts on this ?
"As good as" is a relative measure. Minis allow you to trade smaller. Minis are more liquid in some cases than the big contract. Minis are very amenable to electronic trading. Minis lead at some times and don't at others. The slippage is less on the minis because the electronic market is more fair. Price reporting on the big contracts is much slower than price reporting on the minis because it has to be manually entered in vs. automatically entered in on the minis. Because of that often the most up to date prices are shown on the EMini quotes whether they are leading or lagging. It is a general rule that the contracts that have more volume tend to lead in price discovery.
When listening to the squawk box, I sometimes hear the commentator say that 'the mini is leading it down' or something like that, meaning the guys in the pit are keying off it. But I prefer the squawk box to the mini for an indicator because you don't have to look at it, just listen.
Why pay $10.00 Round Turn when you can pay $4.90 Round turn with Advanced Futures. www.advancedfutures.com
Mark, if your going to post on a thread at least pay attention. The 10 bucks isn't for commissions! It's for the emini data feed versus the 60 bucks for the full contract! Bsulli
I don't think they were referring to commissions, but exchange fees. It's tuff to beat the e-mini if you're gettinf $5.00 or less r/turns. When I traded the full size awhile back it was $25 r/t. Now, I can trade 5 e-minis for the same commish and have the convenience of scaling out of my position. Unlesss of course, you're a big timer that trades 20 or more full-size at a time, the e-mini is all you need.
I'd add that you have to throw some serious consideration for slippage when trading the big contracts. Make the comparison using both the slippage plus total commission. A good friend of mine who manages a fund trades some 400+ contracts at a time instead of using the big contract. He used to get killed with slippage calling that order into the pit. Now, he sees maybe 1/2 point with all that liquidity in the electronic contracts.
It is really hard to get out of the big contract when YOU HAVE to. When there is a big rush for the door the little, off the floor, retail one lotter will be filled last and at the worst price.
All locals in the S&P pit race the paper. That's all they do. That's why the E-mini will only get bigger. At least you know what's there, and you'll get 'em. Look at the CBOT Ten-Year Note. The electronic A/C/E contract is kicking the pit's ass. It's much better for a fund or basis trader to know that they're going to get them all. They HATE partials.