<i>"Think or Swim showed their E-mini pairs trading/arbitrage methodology (I honestly don't have enough experience with the concept, its risk/reward parameters, or how a trader really implements it in real-time to speak on it intelligently). Something about 1 ES contract = 2 NQ contracts was what I took away from THAT discussion."</i> J, the general concept there is constant hedging instead of using stops in symbols that strongly track one another. Pairs trading profits from being correct the direction of stronger symbol. If the assumption is ES will be stronger than NQ tomorrow because GOOG warned while financials were upgraded, long ES / short NQ is the play. If the general market direction is down, hopefully NQ is off by a greater percent than ES. If the general market direction is up, hopefully ES is gaining by a greater percent than NQ. The $$ value spread which ebbs & grows between that pair is one's profit opportunity. ES may be at +$1,000 while NQ is at -$750 per pair position. That $250 gross profit minus two round turn costs is the result. Most pair traders work without stops... it is impossible to have a position completely blow up. However, on those days where ES/DOW are green while NQ is red, being on the wrong side of that move will have losses widening greatly. Pairing the ER and ES or ER and NQ is a better idea than ES/NQ. The two pairs noted have less bifurcation than ES/NQ, with plenty of % variance in movement to create profitable spreads. FWIW... pairs trading is not easier than directional trading, at all. Just a different set of variables to work thru, same basic premise as directional trading.
kudos to those of you who took time to write down some thoughts about this yr expo in nyc personally the highlight for me was eyeballing some of the pretty ladies at the booths ... other than that and some schmoozing with industry folks and wishing them well in 08 I felt the expo was not so great compared to prior yrs basically the one or two sessions I attended let me down I will not name the gent in one of them but after hearing him say ... the market goes up over time .. I felt letdown and left the room ( which was packed ) for him
Hey Surf No dispute on Sosnoff, his rep speaks for itself (including the one during '87 where he reportedly backed up the truck on S&P's when the whole world was a seller). I've listened to him many many times both live and on his Weds TOS live chats. He talks very quickly and passionately but I find it difficult to tease out of those words where the quantifiable edge is that he uses. He's the star of the show, well maybe co-star with James Altucher IMO.
Who knew? He was quiet as a mouse when ToS was giving their demonstration, if he's really that good I don't think it's rocket science, I just think he's not tell'in. Prolly measures the % change vs other indice and a certain set average ... yep I'm sure he's doing something like that, otherwise how would he know what to do? And if you're spreading, the issue is not how much you loose, but simply when to book profits.
LOL, there was a guy talking and there was a guy doing the executions, since I've never seen Sosnoff and identified him I thought he was the guy executing (because I was busy trying to figure-out what he was doing, and why he was doing it). Sosnoff must have been the guy who was talking nonstop. OK, now's I know.
No beret He lost the signature beret the night before The other guy doing the execution was Don Kaufman, their main education guy.