Are fixed income futures harder to trade than other types of futures? I am interesting in learning more about trading interest rate futures but I am under the impression that interest rate futures are harder to trade profitably than other markets. In particular I am interested in short term trading of interest rate futures. Is trading interest rate futures short term an especially difficult challenge?
I would stick to retail type products first like TLT and such for the time being.... Also read Christina Ray's book. There is a lot of cheap information that you will need to learn, might as well pay $50 for it instead of a multiple of that in the Market... http://www.amazon.com/Bond-Market-Trading-Risk-Management/dp/1556232896 Remember a 10 yr futures contract can move $1000 in a single day, especially in todays environment. As for being more difficult, maybe in terms of having macro knowledge, but the returns are mostly uncorrelated to equities, so it helps you diversify. Also they are extremely liquid.
Personally, my first trading experience was scalping 30-year Bond futures. If you start out with something like the 5-year Note future you'd do just fine. On a risk and capital-adjusted basis the futures don't move appreciably different than an ETF like TLT for example. Don't be surprised if you find traders that actually prefer the futures.
More importantly -if trading fixed income futures is "hard" -then which are the easy markets? & why the fuck have I been trading fixed income? Only joking. Fixed income is a piece of piss. Like printing money. It's almost embarrassing how easy it is making money in treasuries. I spend half my time trying to think of plausible excuses when people ask me at dinner parties why I'm so fabulously wealthy. I could hardly tell them that they're giving it away. Never had a losing trade myself. How about my fellow billionaire futures traders?
its one of the easiest markets to trade. edges given away every day. no manipulation from algos. complete liquidity. no market shut downs. enjoy the profits and order your first ferrari as the money will be rolling in.
1) They can move "slower" than other contracts such as the stock index, currencies and commodities. 2) You may be tempted to trade larger size because of the lesser expected price movement. :eek:
All depends... If you want to understand how things work, yes, they're probably harder. If you just wanna punt, they might be actually easier.