ES vs SPY
- Thread starter quin8670
- Start date
i think the key difference is ES trades almost 24 hours daily while SPY is restricted to regular trading hour. ES generally has lower spread/margin requirements as well.
Robert Morse
Sponsor
ES is a Future so taxed as a 1256 contract. ES has a materially lower margin requirement. Short ES futures has no overnight borrow cost while most short stocks do including SPY. The only advantage I can think of for using SPY is if you want a long term position with long term tax treatment and dividends.
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@Robert Morse -- once again (as always) provides great "to the point" content. Thanks
ESPIONAGE VS SPY. Somehow i think these are related.
Robert Morse
Sponsor
Some things
- Trading notional amounts less than a single ES contract starts to get expensive, since the MES contracts have a high commission / fees usually.
- No Ex dividend day to worry about with ES, (and less assignment risk if you are trading options)
- [May be wrong about this] Cash has to be used as collateral for ES, rather than higher yield things like treasuries. (at least for my broker). I wasn't able to hold an ES position collateralized on my other shares.
- Trading notional amounts less than a single ES contract starts to get expensive, since the MES contracts have a high commission / fees usually.
- No Ex dividend day to worry about with ES, (and less assignment risk if you are trading options)
- [May be wrong about this] Cash has to be used as collateral for ES, rather than higher yield things like treasuries. (at least for my broker). I wasn't able to hold an ES position collateralized on my other shares.
Notional amounts mean nothing on ES futures. STAT