E mini inverse/ hedge

C

calhawk01

What's a good liquid future ticker that's a good hedge for emini and is liquid.

I'm talking -1 correlation. Or +1 correlation so It can be shorted.. Other than sp500
 
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The most common symbols would be:
Buy ZN or ZB or J7 or sell E6
They act/serve as a flight to safety to offset ES sell off/volatility.
But what if they dont? You cant know that they will and to what degree.
I have heard more than one trader on this site advise not to hedge this way.

A pure volatility play or an ES option may be better but someone else can chime in on that.
 
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I am not understanding the question. Why do you want perfect correlation for hedging with one future with another? You can always reduce or increase your ES position.

YM,NQ has the +1 correlation and to some extent TF also.

Correlation is a beast and drifts with time. During times of distress correlation of assets tend to cluster. What time-frame you are looking for the hedge.

Bonds currently have +ve correlation.
 
you can trade another expiration.. if you are long Sept and need a hedge.. short Dec.. for longer time periods it could spread, but intra day its fine
 
YM, NQ, and TF correlations will vary from day-to-day (even intraday) with ES. What is your holding timeframe ? Are you starting out with a hedged, purpose-designed spread position or are you trying to lay off risk from a scalp gone bad ( what we refer to in the biz as a "Texas Hedge") ?
 
I miss spoke; instead of hedge. I just want something that has a inverse correlation. Because I have a strategy with FAS AND FAS and mostly all other inverse ETFs that works pretty well. I wanted to try it out with ES but i need to find an instrument that has inverse correlation.. or close to it
 
I don't believe you have a bear futures contract like FAZ to FAS. If you just want pure correlation then do then next expiration out, or have two brokerage accounts and go long ES is one and sell the ES in the other. What are you doing with FAS and FAZ?
 
tandh said:
I don't believe you have a bear futures contract like FAZ to FAS. If you just want pure correlation then do then next expiration out, or have two brokerage accounts and go long ES is one and sell the ES in the other. What are you doing with FAS and FAZ?
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It's essentially a pair trading strategy. Opening another account may work. I hear that's illegal? .. to be short and long same security in multiple accounts?
 
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