Well, margin is a form of leverage of course, but I think that my point re: risk here boils down to (for lack of a better way of putting it) "wiggle room". If you only have enough funds in your account to be close to maintenance margin, you are in danger of wiping yourself out entirely if your position moves against you in the short-term (because your broker will liquidate your marin if you have insufficient funds for maintenance), whereas if you have larger amounts of funds in your account you can afford to "wait out" short-term movements against you in the market. So I guess the risk we're talking about (or I'm talking about) is the risk of premature liquidation in the event of short-term moves against you, which Diode provided a potential solution for (something that I hadn't considered when answering the original post).
I'm having consistent success in swing trading futures. I don't do it often mainly because I don't get a lot of trade signals. Thus, most of my trade signals occurs as day trades. However, if I were to focus more on swing trading (less sleep)...I'm sure I would get more trade signals because I know a miss a lot of trade signals because sometimes they appear in the overnight trading session when I'm asleep. In addition, I don't recommend swing trading futures to anyone that doesn't understand the price action movement during the overnight trading session... For example, I once remember a swing trader of ES and YM that asked why those trading instruments volume and volatility picked up around 3am est That's a trader that shouldn't be swing trading because he has failed to be properly prepared. Also, I wouldn't recommend it for those that are undercapitalized and that have a discipline problem with using stops. I also wouldn't recommend swing trading for those that have all their trading capital tied up in one particular swing trade that prevents them from trading other opportunities in other trading instruments as day trades or as overnight holds for those that hold positions to exploit price movements based on statistical facts. Getting married to a particular swing trade and ignoring other market opportunities can increase the odds for poor trading habits. Here's an example of a statistical fact I stated recently in another thread... http://www.elitetrader.com/vb/showthread.php?s=&threadid=57633 Therefore, to have consistent success in swing trading... You need to know some statistical facts about the markets when things have a high probability for follow-through to profit levels. Here's a hint to another statistical fact out of many I know... Review how the S&P performed in the overnight trading session during the vote counting process. Therefore, without trying to encourage someone that's undercapitalized but wants to swing trade... For those types of traders...at least know when to put on a swing trade when the odds are strongly in your favor. Common culprits that have impact (gives a reason) on the overnight price action: * Eurex and Euronext first hour of trading * 0830am est U.S. key economic reports * Treasury Yields * Funds input...end of month and quarter price action reallocation * Options expiration weeks * Statistical facts when things tend to occur Will not end this post via saying good luck... Luck has nothing to do with it. Do your homework and you'll quickly realize that being properly prepared to swing trade... Has everything to do with one's success level. P.S. It was easier to swing trade when I was single and didn't have spouse and toddler. NihabaAshi