I am curious if any of the independent traders or traders in Trading Firms here have ever traded the Foreign Exchange or Commodity Markets ? Made one daytrade in USD / Euro a few yrs ago and in the 1980's made a few small daytrades in commodities and am thinking about complimenting my trading arsenal to more than just stocks
well I guess I could trade the major currencies through my acount with IB ... forgot about that ... I will try to see if the speads are as tight as the spot FX market
Considering that most commodities are breaking out of a multi-year bear market and are likely to benefit from money rotation out of the sick world of equities, I think this will be a popular idea. I'm looking into it myself and have seen a few online articles suggesting others are thinking the same thing. If you are a trader, you can probably trade anything.
I think futures trading got a bad rap over the years because of various boiler room operations, scams and the typical screw-the-public attitude of the exchanges. Now with the advent of e-traded contracts, you can avoid the horrendous spreads and slippage typical of floor-trade markets, and real-time quotes are readily available. Commissions have gotten pretty cheap too. Bottom line, these are attractive alternatives to daytraing or swing trading stocks. The game is a lot different than stocks. Most futures traders concentrate on a handful of markets. No need to scan hundreds of stock charts a night and run a scanner during the day. You can watch every tick in your focus markets if you want. Just because there is enough leverage available to destroy your account in a few weeks does not mean you have to use it. Most CTA's will only use maybe 30% margin:equity ratio overnight. The most active markets are the stock indexes, the bonds, the eurodollars (ie interest rate contract, not eurocurrency) and the energy complex. Currency futures are reasonably deep but watch out for the overnight moves. The ag markets should not be overlooked. The meats and grains have relatively low margin requirements and can trend big time. Tehy are also not too subject to big overnight swings. Bean meal is a traditional newbies' market. Not too volatile but deep enough to trade easily.