Assuming someone has the capital to trade either e-mini's, FOREX or stocks, which one is most profitable with lower risk of losing principal? Pros and cons?
Well, I have day traded all of the above extensively, and for me anyway, eminis are the best. Why? Massive liquidity and no specialist/market makers. Its 100% electronic, with a 1 tic spread. The market also usually trends well, especially compared to intra day forex. Not so many spikes outta the blue. Commish is also low. Don't kid yourself when you hear there is no commission in FX. the spread more than makes up for this. Also, most FX firms are trading against you. It is not in their interest to give you the best possible fill. This is how they make their money. Stocks are harder to day trade as there just isn't enough volatility in most of them. This is exactly why Don Bright says the direction game is over in stocks. I do not agree with this, but I do think its harder, and I don't have that much patience. I like fast, large moves. There's lots of equity guys on ET that think futures are impossible, that everyone loses. This, of course, is idiotic as its a zero sum game in futures. The money goes someplace, and very little of it in the form of commish to the wire houses. I believe it is just a matter of practice. The guys at Bright say that NYSE is the only place you should trade, while the guys at Itrading would say they are insane. Anyway, my 2 cents worth. Jay
I agree with Jay - I much prefer futures over stocks or fx. Some other reasons: > Better tax treatment > Can focus on a handful of markets > Liquid, electronic, transparent And it doesn't hurt that the cost of access is so small that just about anyone can jump in! The reason I say that is, as Jay pointed out, money gets transferred from point A to point B every day... It has to originate from somewhere.
forex account/trading margin as low as $250/25 ($1 with Oanda) 'commission' $3 pair specific roundturn + $1 per overnight - mini charting + realtime feed free including multi-year history â renewable demo account excepting 'fast market' instant fills no 'overloss' minimum 11 pairs to trade very few 'gaps' intraday and/or day-to-days trading massive system/trading method user base for MetaTrader program
i endorse this post. interest in stocks is slowly dying and the actives trade similarly to the eminis but with much less intraday rotation. futures, commodities and currencies are the best game in town right now per liquidity, volatilty, limited costs and limited capital commitment, hence leverage.
When i was trading fx from a demo account, I was making some insane money in just minutes to hours, but I just as easily lost it, because of such high leverage. People love the idea of being able to buy millions of dollars worth of currency with only a couple k down. 1. FX is very liquid, so no one person or company can manipulate price. 2. open 24hrs 3. Only a few major pairs to worry about compared to thousands of stocks 4. insane leverage.. 100:1 or more 5. no day trading rule ...I'd like to get into fx soon, because it fits my personality.
Although ETFs are traded as a stock they have some of the advantages of an emini and some of the advantages of an equity. Are ETF a different catagory than stocks, futures, forex and eminis? Should ETF be a different catagory? Thank you,
If you know what you are doing, many do not, probably e-minis. Day trading stocks cannot yield the same profits (or losses) as e-minis unless you have a lot of capital. Still testing FOREX, so my mind has not been made up yet on this. Seems very volatile, but so are e-minis at times.