trading the Globex mini or micro currency contracts ?

Discussion in 'Forex' started by Wallace, Feb 24, 2011.

  1. had a look at the M6E last night, it looks like market orders would repeatedly get hit
    with 'slippage' because of the low volume, 24 hour under 6,000 contracts traded, and
    think the E-Mini Euro FX - E7 has a similar volume

    Micro Euro FX - M6E - $12,500 Contract - $1.25 per pip - Daytrade Margin $100 -
    roundturn commission - $1.99
    not a bad bang for the buck and the commission is the equivalent of 2 pips
     
  2. yep, traded it...good to practice on and enough volume. Also have traded mini Corn...both are good to practice on and hold overnight
     
  3. hi increasenow, were you entering with market orders or limit/etc orders ? did you
    get what you'd consider 'slippage' on any fills - entries or closes ?

    am using a CQG demo but should have a live next week and will be interested in
    seeing how the mini and micro perform during the NFP release
     
  4. Solely market orders...slippage really is not an issue as you just need it to go in the direction you want. It's been fine for me
     
  5. that's good to know


    here's a comparison of the M6E with the 6E, minute charts from Thursday's session
     
  6. but don't you have to pay spread + commis? your in hole $4.50 right from the entry before the thing even moves, or about 4 pips? how is that good?
     
  7. ah ya...try trading the large Euro future...if it slips 1-2 you are $12.50 to $25.00 in the hole...the deal is, if you are going for a 20-100 point target, who cars about slippage...
     
  8. TheMan

    TheMan

    i love it when INKY DOODLE DANDY gives advice on trading
     
  9. killthesunshine:
    there's several differences between futures contracts and trading versus fx trading
    first, futures contracts are traded on an exchange, both in a pit - open outcry as well
    more recently, 'electronic' trading as it's known, in this case the CME Globex market
    'future contracts' is a financial device that's been used for centuries, but retail forex
    trading is only a decade or so old, a child of the pc and internet, although foreign
    exchange trading has of course also existed for centuries

    a futures contract is for a standardized amount and quality, while with many fx brokers
    any amount can be specified in the 'lot'
    CME's introduction of the M6E - $12,500 Contract and E7 - $62,500 Contract is a
    response to the huge retail fx market they are losing out to, they'd like some of that
    business and created the smaller than the 6E etc $125,000 contracts, which has
    lowered the account margin minimum with AMP Futures for instance from $2,000
    to $500 , with daytrading margins for the M6E at $100 and the E7 $250, this makes
    them considerably more affordable than the $344 and $1,719 daytrading margin
    required to trade those contract amounts with an fx broker
    when trading a futures contract o/n - overnight, the daytrading margin increases:
    6E from $500 to $4,320 - E7 from $250 to $2,160 - M6E from $100 to $432

    when a futures contract is traded, a commission is charged per contract traded and
    charged to the account when the trade is closed, for the M6E the round turn comm-
    ission via AMP is $1.99 , there is No additional spread charge
    however, in addition to the single commission fee which is determined by the broker
    alone - not regulated, that fee is fixed, unlike the fx spread fee/commission which is
    variable
    for instance Oanda's minimum spread on the eurusd is 0.9 pips or $1.125 for the
    $12,500 contract/lot size, but, Oanda and all other fx brokers' spread can and does
    widen, for Oanda this means it can go to 10 pips and I've seen it at 20 pips, and
    while the Oanda spread can change throughout the trading day, the spreads in not
    constanty fluctuating - widening and narrowing as it does at most other brokers
    also there's the matter of 'news/economic reports/releases' when the spread on fx
    trades is guaranteed to widen, that doesn't happen when trading futures contracts
    the commission is fixed, it does not widen
    E7 $62,000 contract rt commission via AMP is $3.37 , Oanda spread fee is $5.625
    6E $125,000 contract rt via AMP is $4.87 , Oanda $11.25 or, $112.50 or, $225.00 -
    when the spread widens to 10 pips or 20 pips

    there is tho one matter where fx trading wins out against futures trading and that's
    'overloss'
    overloss is a situation when trading futures that an open losing trade that is not
    closed can result in losing more money than is in the trading account, continuing to
    increase until the trade is closed, the additional money lost is owed to the broker
    fx brokers prevent overloss occurring by closing a losing trade, either when the loss
    becomes greater than the margin required for the trade, or, when the loss reduces
    the trading account balance to $0.00
     
  10. So can you do both buy stop and sell stop 15pips apart limit orders straddle on eur or Gbp currency futures with 50pips target both sides 30sec before NFP? Any widening, slippage or orders not filled issue?
     
    #10     Feb 25, 2011