why did SEC come up with PDT rule when they are going to approve SSF anyway ? SSF isn't going to make trading less risky, in fact, it has gotten even more risky with the 20% margin.
I'll try this one more time, hopefully someone will get it. Leverage has NOTHING to do with being more or less risky. It has to do with correct money management. If you don't understand this you are probably trading too large a size. Get Van Tharps first book and study it carefully.
Point: The ability to perfectly hedge a stock position is justification enough. Hedging adds liquidity, and liquidity (or in other words the ability of companies to raise investment money) is the market's primary function. Counterpoint: Does anyone know if SSFs will be stock or cash fungible? Lack of fungibility for both cash and stock could be the Achilles' heel.
In terms of intra day scalping, are these SSFs going to be the ultimate leading indicator for the stock you are trading (thanks to DOT)??
will we be able to "check the futures" on individual stocks before the market opens? If so that is one benefit. What will be the size of these contracts? 100 shrs? 1000 shrs? also retail traders will be able to hold positions overnight with 5:1 leverage, that is good if you want to hold winners overnight. Prop firm involvement? It seems that almost all prop firms are strictly geared to trading as much stock as possible, and they don't allow futures at all.
i understand that leverage has nothing to do with riskiness, i wasn't against leverage but doesn't the whole SSF thing just makes the PDT rule redundant ? If SEC thinks that PDT is going to reduce speculative risk in trading, isn't the 20% margin requirement just make it worse. People could just over trade.
Does anyone know when these things are suppose to start trading......theres already about 4 or 5 books out on how to trade them....but I have yet to see someone come out and say they will start on this day.........tia