I am considering starting to trade the S&P 500 mini. What I need to know is, can I trade it from a cash account as I dont need the margin or can I only trade it from a margin account?
Each emini contract is worth $50 x the S&P Stock Index + basis. This puts each contract value at around $62,000. If you weren't trading on margin, you would need that much cash in your account to trade it and would be liquidated as soon as it downticks.
FT71, In addition to selected threads and posts here in the Futures Trading Forums on elitetrader.com, in your opinion - since you trade Futures - what are a few other web sites and publications that would be of benefit to traders looking to build a solid understanding from the ground up about Futures trading. Thanks.
So lets say i wanted to trade the e-mini s&p 500, how much is a good account to start with? Is 5k any good? I heard that a good point about trading the s&p is that you dont need as much money as, lets say, stocks?
Thats good because you will lose less money learning. I like to have 10K for every contract that I trade but if you have a good edge and small stops 5K is more than enough to start.
I think the best websites for futures beginners and pro's alike are the exchange sites. I especially like the CBOT website. It is so full of everything from the basics to advanced strategies for their products. The knowledge there does not have to apply just to their products and it is free. I like www.dailyfx.com for release schedules along with Nasdaq's website. I use www.deltaT1.com for S/R input. I use www.indexarb.com for every day info on fair value, index composition and underlying stock weightings. I use Eurex's website for a lot of details because I trade the DAX mostly. I use Market Topology for correlations. I use futuresource.com for charts on products that I don't subscribe to in real time as an overview to see what other markets are doing. I use earnings.com for an idea of what earnings I should expect. I use www.bondheads.com for the latest in yields to determine what cost of carry is for Fair Value. I hope that doesn't confuse you too much.
I strongly believe that you should start with $5000 simulated dollars in a real time account some place. Pay the exchange feeds for 2 months or so and see where you end up. This should only cost you about $50 or so. You will then be able to assess for yourself how much money you need. Futures are highly leveraged so for every tick loss as a % of your account balance is quite large. This means that things can go badly very quickly and, obviously, the opposite may also be true. The cards are stacked against you when trading futures, so always trade with a keen eye on the downside rather on your target. Print out the product specifications for the ES and know them well. Honestly, anything short of doing this is just a good way to lose confidence and donate a lot of money to guys taking the other side of your trades who don't really need your money. Best wishes.
Nope, just profuse gratitude for you taking the time to lay it all out there for everyone interested.