I agree except the part about being regulated, that's why these are the glory days of forex. When the government regulates it, it will be just another market for the big boys who pay the bribes. But by then, there will be another unregulated market.
the pathetic thing is, now he is lying in the graveyard, yeah I out lasted him, but now he has no worries, and I am still worried that I might be a failure.
You actually raise an interesting question, at least from an historical standpoint. Spot FX, as is currently available from various brokers, is a relatively recent concept. Back in the day, ie 1980's and 90's, FX trading was the province of banks. You had to be able to swing a pretty big line to participate. The CME had hit a big home run with S&P futures, so it was natural to look for something else, hence currnecy futures were born. Unlike FX, in which the "larger" currency is always the numerator, CME currency futures were all priced in dollars, just like beans, and had a fixed contract size, just like every other commodity. Since futures have an expiration date, they are priced somewhat differently than spot. In spot, interest rate differentials are a key factor. You can earn a nice spread by shorting a low yielder and going long a high yielder, provided the relative values stay close. And of course, that spread can be multiplied many times by leverage. With futures, the rate differential is already priced into the contract value. Of course, you have to hold the contract until expiry to realize it all. And leverage is fixed by exchange margin requirements. More recently, another product has been introduced to allow currency trading for smaller players, FX ETFs. They trade exactly like stocks, so you don't need to have a futures account.
it also helped when you had a president that boldly said, "The dollar must go down." But getting back to opie, he likes stocks and thinks he has a read on the market, his only interest in currencies is that he is concerned moving to index futures will put a cramp on his account balance due to the minimum of trading 67k at a time. Those were the days my friend, long cattle, long swiss francs, beat the heck out of having a real job.
I'm checking into that. It's the (eur/usd) M6E right? Are the spreads huge because of the low volume? I'm very interested in that because it would be just $1.25 per pip which would be great for intermediate term trades even if the spreads were a little wider than normal.
With a small size contract like that I can practice trading M6E while I'm doing my other strategies with the E-mini. I'm definitely not going all forex or currency futures for a while. But it'd be nice to try something here and there with low leverage to see if I can get a feel for it.
Yep. Dont try to day trade those things. Even with intermediate term trades the spread will still sting ya.
Is the M6E the most liquid of all the E-micro currency futures? I won't be able to tell until the market opens. I've traded a lot of stocks with very low volume in the past and it's not the end of the world. I would just have to be a little more careful with my risk control. I would assume the margin requirements for these contracts is very small as well so if something is going my way I could really load up on them.
Micro Euro futures are alright. One penny is $125, so it's appropriate for smaller accounts. I've noticed during RTH the spread and liquidity is reasonable. And yes, Micro Euro futures are the most liquid of the Micro FX Futures contracts. One would consider this more for position trading in a listed market, rather than scalping or shorter term trading. GL trading