Can you help me understand spread treading?

Discussion in 'Commodity Futures' started by Folio, May 9, 2020.

  1. Check out @s0mmi ’s posts if you’re interested in spread trading. He made at least a couple million spread trading and worked with multiple 7 figure a year spread traders at the prop firm he traded at. He was mostly spread trading fixed income (like spread trading the 10 year t note against the 30 year t bond and the like). Using past tense because I believe he said he’s focused on the crypto markets now. His posts provide “juice” as he calls it.

    “If someone else is reading this message and they're struggling (like I was, for a long time) then they probably deserve this juice straight out of my nuts because we're onto Page 12 now”

    Straight outta his nuts... a man of the people lol.

    Good luck
     
    #31     May 10, 2020
  2. wrbtrader

    wrbtrader

    What's the trading instruments, did you have any prior simulator / backtest results before you tried it on simulator and what's the black line ???

    Looks like you're doing some funky stuff there that can cause you to hurt yourself.

    wrbtrader
     
    #32     May 10, 2020
    MichalTr likes this.
  3. Folio

    Folio

    Yes. Before this course I only bought some stocks and I did that with another platform.
    In the course they don't force you to use this broker but they suggest it due to the good coomisions.

    No I bought it from a man, but a few years ago I have been contacted by a very nasty and vulgar woman from the Czech Republic too and I just hung up on her.

    Why do you ask these questions? Is Interactive Brokers not a good platform? Online I am reading good reviews.
    Personally I don't like it very much so far, it looks like a software from the 80s and it's a bit confusing, but apparently its commissions are low.
    Tell me more about it.
     
    #33     May 10, 2020
  4. Folio

    Folio

    In that graph I was analyzing the futures of corn december 2020 and corn july 2021.
    The black line shows the trend of this current year. In 2 months the trend should start in theory.
     
    #34     May 10, 2020
  5. Folio

    Folio

    On one of his posts he suggests to buy a course from a guy on youtube :D
     
    #35     May 10, 2020
  6. Folio

    Folio

    Anyways since this problem with ticks isn't clear, could you just tell me how YOU calculate it?
    Yes I can just look at the numbers online or on the broker, but I want to understand how it works in a consistent way.
     
    #36     May 10, 2020
  7. MichalTr

    MichalTr

    The screen you posted. Is it from seasonalgo app ? And what is the address of the site, where you bought that course ? If you have been contacted by that lady, you probably left somewhere your contact data. So is it same company ? I'm asking just to know if it's that one, that I think might be a scam. If yes, then I can share why I thing that, so to warn other ppl.

    About Interactive Brokers - I don't use it, so I can't say anything. But just looking around it seams to be very good choice. And their fair behavior after their technical issue on crude is also good sign.

    But I think this suggestion has nothing to do with commissions ;) Like I wrote, they are introducing broker for IB. Which is not a crime of course. But depends if someone stated it openly, when you was "encourage" to use it.
     
    #37     May 10, 2020
  8. MichalTr

    MichalTr

    Ok, you really don't read our posts carefully.
    It is part of that job, not to ask for ready solution. To dig, to find. Then eventually come with solution you think is good and ask ppl what they think about it and how they go into that subject.

    Let me help you:
    https://lmgtfy.com/?q=crush+spread
     
    #38     May 10, 2020
  9. He's (s0mmi) the real deal that's why he's followed by a guy who trades over 100 million futures contracts a year and owns a trading company (garachen). I don't agree with that specific recommendation of his that you mentioned but so what? There's a lot of great stuff in those posts of his, I've read all of them. You honestly asked some of the most basic questions about trading ("how do I sell contract I haven't "bought"?" are you serious dude?) and then you made some of the silliest most foolish observations about spreads ("they seem to follow each other,. how do I make money?" *paraphrasing* lol). s0mmi was trading fucking SIZE at Propex in Australia. Dude is not a phony. Considering everything including your lack of basic knowledge your response is pretty ridiculous and rude. Was trying to help.
     
    #39     May 10, 2020
    Real Money and MichalTr like this.
  10. Real Money

    Real Money

    There is a very steep learning curve in futures spreads.

    This is because, not only do you have to understand futures and outright risk (and how to trade it), you also have to understand calendar and intermarket spreads (and what might influence those markets).

    Stuff like spot/forward relationship, market making, no arbitrage pricing models, carry, basis, arb, term structure, etc.

    In other words, quantitative finance, financial mathematics, and financial engineering.

    This is hard to learn. Most people involved in this type of thing have specialized knowledge and a relevant education.

    Anybody who tells you they know everything about spreads is a fool.

    There are guys posting on ET acting like they know everything about futures spreads. But, it's pretty obvious they don't have a clue how deep this game is.

    Spreads are used for different things. You can build a synthetic instrument that tracks the behavior of a set of underlying assets. You can trade the relative performance of assets. You can trade delivery dates of an asset and even trade delivery spreads against each other. You can trade futures differentials that are being traded against OTC markets.

    Basically, the way you trade this stuff is by being able to think like a professional trader. You can trade an index against another, trade crude against brent, buy bonds and sell notes, mix fixed income exposure with equity price risk.

    The thing is, most people (understandably) wouldn't have a clue how to do any of this stuff.

    Spreads can be used for hedging, trading, and as tools to gain information about market conditions, and are used throughout all of finance and markets.
     
    #40     May 10, 2020
    beginner66, nbbo, bone and 3 others like this.