Why daytrade stocks instead of futures?

Discussion in 'Trading' started by ADX_trader, Oct 14, 2002.

  1. PDT rule and 25k requirements for daytrading stocks. Now all you need is a paltry 5k and you're a futures daytrading maven :D
     
    #21     Oct 14, 2002
  2. Leverage is the answer. You can much more leverage with future. Which is great and dangerous at the same time.
     
    #22     Oct 15, 2002
  3. Advantages of Trading Futures:

    - Lightning Fast Executions (from what I hear)
    - Very good Spreads
    - One market, knowlege of only one trading vehicle
    - High level of leverage
    - Ability to hedge against a diverse portfolio
    - No risk of bankruptcy or corrupt CEO / Board
    - Short-term holdings have favorable tax consequences over Stocks
    - No SEC


    Advantages of Trading Stocks:

    - Wide range of choices to trade
    - More ability to be creative when trading (pairs, etc)
    - Leverage via Options and Margin
    - Ability to use futures as a slight leading indicator


    Disadvantages of Futures Trading

    - Lack of leading indicators
    - Huge ability to leverage can work against you
    - Generally one of the most difficult markets to trade

    Disadvantages of Stocks

    - Risk of Bankruptcy
    - HALTS
    - Specialists
    - SEC
    - Poor execution speed and poor spreads for some stocks
    - Taxed unfavorably for short-term holding times
     
    #23     Oct 15, 2002