Discussion in 'Index Futures' started by mureese, Feb 17, 2007.
i was wondering if you could hold a contract a month.
Most likely, the brokerage firm will close your account and steal your money.
That's the most likey scenario...
Why not ? Try JUN07 contract if you want to hold longer than March 16, 2007.
Not every broker is refco....
You can hold any contract until it expires and settles.
Highest probability i could,;
but as a practical matter having traded it & Eurex-US equivelent,
glad i gave the CME more than 1or 2 comissions per month
And its a matter of public record ,Paul Tudor Jones has held his farm/wildlife hunting area much MUCH more than a month;
I am speculating ,probably he trades derivatives more than once per month.
Agree with your general principle of holding a good trend.
Not always -- some futures will be liquidated by your broker prior to expiration.
If your position is in the hole and you exeed your margin requirements, your position can and usually will be liquidated. If you assume the position is positive, there's no reason for a broker to liquidate prior to expiration.
Some futures contracts are settled by physical delivery of the underlying, and
that can become possible before the actual expiration date for the contract.
If you are trading futures as a speculator (as opposed to as a legitimate
hedger), then brokers (in my experience) require that, if you want to maintain
your positions, you roll them forward to the next contract before the `First
Notice Date' specified by the exchange (for the long side), and before the
last trading day (for the short side).
The reason for the difference is that it's the short position that gives
notice to the long position of the intent to make delivery of the
underlying. So brokers generally want speculators to be out of long positions
well before it's possible to be given notice by the short position.
If you don't roll your positions forward in time in such cases, then brokers
very well may liquidate your positions with or without warning you in advance.
IB, for example, explicitly states that they will liquidate positions without
notice, if they are not closed out in time.
There are some quirks in trading futures and it pays well to spend some
time getting familiar with the specific important dates for the contracts
you are trading. I've made some mistakes in the past
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