Best way for an American to trade foreign markets?

S

Sky_Davis_

Hey guys,

I am new to daytrading. I've mostly been trading US equities. But have been looking to trade foreign equity markets so I can trade in the evenings. I was considering doing Tokyo (works well for my time zone) on IB but the fees seem absurdly high (.08% of position value per trade).

Is there any better way to do this? Or is Forex really my option if i want to be able to trade evenings?
 
Futures are also a way to gain exposure to global markets without dealing with the OTC forex market. Just be aware if you're an American and you have less than something like 1 million in cash, IB will not allow you to trade forex OTC.

You should probably call your trade desk and ask whats going on with the fee structure and if there is a way you can trade internationally easily.
 
Sky_Davis_ said:
Hey guys,

I am new to daytrading. I've mostly been trading US equities. But have been looking to trade foreign equity markets so I can trade in the evenings. I was considering doing Tokyo (works well for my time zone) on IB but the fees seem absurdly high (.08% of position value per trade).

Is there any better way to do this? Or is Forex really my option if i want to be able to trade evenings?
More...

I would only consider Global Future and stay away from the single stock risk of foreign markets.
 
- Equity: Foreign ETFs for Europe, Brazil, China, etc.
- Bond: Eurobonds, Bulldog, Samurai, Panda bonds, etc.
- Forex: obviously trading a foreign currency but that's not quite what you're after.

A bit on the fringe, but also companies that are registered in the US but have a large international presence. These tend to move in concert with their respective foreign market.
 
kmiklas said:
- Equity: Foreign ETFs for Europe, Brazil, China, etc.
- Bond: Eurobonds, Bulldog, Samurai, Panda bonds, etc.
- Forex: obviously trading a foreign currency but that's not quite what you're after.

A bit on the fringe, but also companies that are registered in the US but have a large international presence. These tend to move in concert with their respective foreign market.
More...
I think the time is the issue for the OP, trading those in the after hours market is probably not great liquidity-wise?
 
Robert Morse said:
I would only consider Global Future and stay away from the single stock risk of foreign markets.
More...

I agree... however, the OP is a newbie, and futures don't seem to be in his repertoire at this time.

That said, I went through a similar interest MANY years ago, mid 2K. I analyzed volume for FESX to determine trading times conducive with my then time schedule and trading methodologies. Although it was based on what is now ancient data, I have no reason to believe the times of trading activity have changed much, if at all. But the absolute value of volume has likely grown. Just some visual food for thought. All times are US-Eastern Standard Time.

europe.jpg
 
Robert Morse said:
Do you think foreign equity markets would have a short learning curve?
More...

You specified equities, so for a US trader... yes and no, it depends on trading methodologies used.

Forgetting about actual clock-time, (market moving) economic reports are different, as are (company) accounting standards. General news may also need an "upgraded" stream, versus typical outlets. So if "news" is part of the trading methodologies, there is a learning curve.

Then there is currency conversion... your equity position is up 2%, cool! But conversion rate (and possible conversion fees plus normal trading fees and commissions) and you might be looking at breakeven or worse.

Trading methodology will dictate how steep a learning curve. IMO
 
I appreciate the replies so far. Just to expand upon the types of trading I do - I only do scalping. So i'm in the trade for a very short time frame. I dont think the currency fluctuations would affect me much which is why I was looking at foreign exchanges.

I honestly havent explored the Futures market at all. But based on the responses, it sounds like this is the way to go, I just have a lot to learn. What brokerages would you recommend for Futures trading? Also if there's any learning materials you would recommend for getting started with Futures & Options trading, would appreciate that too. Thanks.
 
You must log in or register to reply here.
Back
Top