One reason I have not jumped into the futures market is because of the leverage. I cannot quit thinking about what could happen to my account if I am leveraged up to the hilt and NY or DC gets a dirty bomb. Many futures traders will be toast overnight. How easy would it be to get out of your position if a bomb hits intraday? Am I just paranoid or what? :eek:
probability is on your side, you might be short of flat. But seriously, there's nothing you can do about risks similar to the this. Another one to think about is what would happen when you're long overnight and a massive Tokyo earthquake hits. One every 100 years and the time is right about now.
Ah, didn't think of that. From now, I am a short artist only. My luck, that is when Osama will be caught... I guess I could just flip it ASAP...
what has leverage got to do with it? if you're long when a nuke goes off and you're late in closing your position you're gonna get hammered no matter how leveraged you are. if you were planning on using the available leverage to the maximum, you're gonna get hammered anyway, nukes or no nukes... yes, to answer your question, you are paranoid. too paranoid (if you were serious with the above comment) to even be trading in the most benign periods of international relations...
If you are long, close position at market and immediately reverse to go short, and make your loss back and some... there is certainly good money to be made off a nuke going off in America, assuming you are not one of the people who was just nuked (and are therefore incapable of trading) and also assuming the futures exchange and/or internet backbone wasn't taken out by the nuke...
The answer is very simple. Don't trade with too much leverage. If you get caught long in the US markets, and the exchanges get closed like post Sept 11, make sure you have enough capital to take a short position in the European or asian markets, thus minimising the damage. If you can manage two contracts to your one in the US market you still should make money on the short side. Runningbear
in my opinion a nuke, earthquake, etc... is one of many risks involved in trading. (with low problability) I think that every market participant - institutional or private - should have a worst case plan for all the different risks involved. In other businesses there are also many risks involved. Some are operational due to the of internal systems or people. Then there are legal risks, fraud risks, etc.... and every good company has always a worst case plan for the different scenarios. Few years back when I read Marty Schwartz's Pit Bull I was impressed by his personal risk management. And IMO this is what every trader should do a little bit. A carpender or a medical doctor will always find work... but traders won't find work when markets are closed for what reason so ever. It's also always a question how much risk you can personally tolerate. And to define risks and find a plan for the scenario takes some time and must be developed over a certain time. alain
My suggestion, do NOT try to capilalize on disasters, either natural or social. However, hedge your positions against such events. Otherwise, you will be regreted.
If a nuke goes off in the USA, losing your money or not making should be the last thing on your mind......peace