ES versus ER intraday- which is best to trade

Discussion in 'Index Futures' started by hardyards, Jun 5, 2006.

  1. ES versus ER intraday- which is best to trade.
    I have only traded the morning session of the ES, but I would be interested in the pros & cons of the ER versus ES.
  2. ER2, smaller spread and lower commisions.
    However if you trading more than 50 contracts at a time,
    ES might be better.
  3. ER is thinner, more volatile and more jumpy. For same number of contracts, much riskier.
  4. opm8


    If you want to compare apples to apples then you would have to use half the number of ES contracts to maintain the same approximate level of risk since one ES pt = $50, while an ER2 point = $100.

    I've switched to the ER2 for the liquidity, volatility and what I see as more technically "cleaner" signals, ie less head-fakes. However, you would need to get used to the "jumpiness " as AAA alludes to. It can hop a point (10 ticks) in a second and can get crazily erratic in a fast market with prints going off seemingly all over the place. You can't tell this from a historical chart, of course.

  5. danoXP


    going from ES to ER2 could be like going from a horse back ride to the rodeo.

    ER2 is just coming off an all time high ...

    ES is still well under it's all time high in early 2000.

    see attached
  6. Right now, I prefer the ES. The erratic moves on the ER2 can take out stops rather quickly. Depending on how you trade, this may or may not be a problem. I like tight stops and to have a 10 second jump take your stop out only to go in the direction you expected is frustrating.
  7. Kensho


    Yes and considering that the risk on ER2 is double that of the ES with the same number of contracts, you can save a lot of money on commisions by trading 5 contracts of ER2 instead of 10 contracts of ES for example.
    As far as why its so jumpy I think its because it has a pretty big ATR of near 2% which is far larger than the ATRs for ES YM and NQ. And its has the smallest market cap of all four indexes.
  8. danoXP



    SP Midcap 400? ... would complete my set of 5 US Equities Indexes for electronic futures contracts that trade almost around the clock

    ER2, YM, ES, NQ are the others.

    ... am I missing any?
  10. ES is choppy; ER2 tends to trend more smoothly, in general.

    If you like buying dips and selling rallies on trendless days, then I'd suggest ES.

    If you like buying/selling and, ideally, holding to the close on a trend day, then I'd go with ER2 or Nasdaq.

    The ER2 reminds me of the Hang Seng Index (HSI), which trades overnight in Asia.

    If you trade ER2 with tight stops, expect to get stopped out rather frequently.


    Good luck.
    #10     Jun 7, 2006