I am currently a daytrader trading stocks. But I do want to give S&P500 daytrading a try. I know there is the ¨big¨one and the e-mini. What is the biggest difference trading them? I know about the margin of course. But when actually trading them what is the difference? How do you execute your orders? Do you have to do that over the phone or is there an online execution system? All replies is appreciated. THX
The main difference is the time it will take to get your order filled... with the e-mini's, your market order will be filled almost instantaneously, because it is a fully electronic exchange... orders are matched instantaneously by computer. with the BIG one... you'll have to wait a bit longer, simply because you order goes to an open outcry trading pit and then you have to wait for another trader to take the other side of your order... BTW.. the pit boys LOVE market orders... it gives them a license to rob you blind... I don't suggest using them for the BIG S&P also... the e-mini S&P ticks in .25 increments ($12.50), where as the BIG trades in .10 increments ($25)... Most brokers should be able to give you online access to both... you shouldn't have to call in your orders, except on rare platform outages or things like. Happy Trading!! Dave
Thanks for your input. How long will it take until you get a trade confirmation for the big one? Could that give you a problem? If the price move away from your entrypoint when you are waiting for you order.
Every broker will give you a wide range of how long it will take to fill and confirm you trade for the full contract. You might just look to trade the mini for fills in the seconds consistently. Even though you have to trade 5 minis to equal the full and pay five commissions for that trade it usually end up being less than the slippage you might experience trying to get a on fill on a big contract. And alot easier and painless
It all depends on the firm you go with. What takes 1-2 seconds with the E-mini will take 10-20 seconds with the standard (big) contract under normal market conditions with a good broker. Crappy brokers can take minute"S" with the standard contract. What separates them is how they get the order to the floor and back. Some use hand helds (can be extremely fast), others arb them into the pit (kinda fast), and some run them in (can be slow). The only thing I can recommend is talk to different brokers and find out how they get the order to the floor and back and also check out online forums dedicated to futures and see who others recommend (marketforum.com, commoditycafe.com, etc...).