Stocks or Futures?

Discussion in 'Trading' started by Lorl, Dec 29, 2007.

  1. Lorl


    I would be interested in hearing people's educated opinions about whether it's more profitable to trade stocks or futures.

    I'm not interested in a factual laundry list kind of answer (I already know many of these facts, such as the different tax pros and cons, etc.).

    What I'd like to hear about if your real life, hands on experiences if indeed you've been trading one or the other successfully for awhile and made a decision which one you prefer.
  2. I trade mostly index futures.

    Many many advantages.

    Trade after hours
    No problem shorting
    Huge leverage
    Great liquidity

    And with index futures, you don't have the extra work of following a particular company news or events or have to worry about surprize upgrades or announcements.

    I once held a large position in BCSI, a very volitile low float stock.
    One day, out of nowhere, their management 'pre announced' a large quarterly loss and I lost thousands.

    Another time, same stock, out of nowhere came the news that the SEC was investigating BCSI management for insider trading.
    Once again the stock opened for trading drastically lower on the news and I lost thousands.

    With index futures, you don't have these issues.
  3. good post long have you been trading futures?

    Lori I've traded stock/options for several years with both big gains and losses. Futures for only 3 months and although profitable so far (primarily because of the increased volatility) who knows...if volatility drops and we have days where the ES trades up/down 3 pts...might become very difficult.
  4. That was a great post Reno but still didn't answer his question.
    I have been trading stocks for 9 years and I am 3 weeks old to futures. Stocks have been very profitable for me. However futures have been showing great potential.

    Let me put it this way, since I have started trading futures I have cut back on my equity trades. For instance, I made 4 points in just a few minutes trading ES.

    Very tough question to answer though
  5. ark


    Personally I prefer futures; Liquidity, familiarity and such.

    It'll be best to trade both instruments and see which you would prefer. You'll learn about them much quicker this way.
  6. Pita



    I think daytrading index futures is the most stressful kind of trading one can do. Easiest is position trading with futures though most rewarding are stock options.

    If you come from trading stocks (not options) you gonna have a very hard time to adopt (day)trading (index)futures.

  7. It's not stressful at all as long as you use stops..
    It's fun making fast money!
  8. Pita


    if daytrading futures at all I would recommend the grains, bonds and notes as they have nice trends intraday, well bonds not really as they rather move exposive though quite easy to trade I would say.
    ES, YM and NQ will give you a big headache most of the time. At least it did for me when I was more actively trading it. What is very fast and makes great moves mostly every day is the ER but it can be really jumpy and slippage is not uncommon.
  9. re: index futures

    This is nice happy happy. I do however agree with reno's assessment of the advantages of futs.

    The truth is a bit darker, IMO. Index futures are generally acknowledged to be the toughest market to daytrade. I've been trading longer term for about 8 years and I've just recently taken 3 months off to watch the markets full time intraday, both futs and stocks. I can tell you that it was way easier for me to find a groove trading stocks than it has been trading the YM.

    Some people have said that they feel the index futures move more smoothly than the stocks. Maybe on an EOD basis but so far (very short time, admittedly), I have found that stocks can exhibit trendy or even smooth days as least as often as index futures. I think the point is that in individual stocks, there is a particular story, and when the story hits, you are dealing with a fixed amount of information.

    Anyhow... I know my opinion doesn't count for much but that's been my experience. I do feel that it is highly misleading to say that a beginner trading the index futures can count on 'it's fun making money' to characterize his or her initial weeks/months.

    Bottom line - you need to trade both on a simulator and figure it out on your own. Asking here will have limited value.
  10. rjv27


    Futures are a very efficient/fast market and dominated by professionals and bots. I do trade both, but I find a lot more inefficiencies and information in stocks plus the ES is a nice leading indicator for stocks.
    #10     Dec 29, 2007