Failed futures traders switching to equities

Propaganda · May 13, 2009

My sequence of interest was stocks -> ES -> FX...

I found stocks to manipulated and frankly I was overwhelmed... like a ADHD kid in a toys/guns/kittens/comic shop.

So the ES came around... one index... doing stocks still means needed a general or advanced understanding on behind the various indexes movements... and being new the whole lower margin caught my eye (typical newb)

So then wanting to start with the lower amount of capital just to get real money experience I ran into FX one night on the TOS demo platform... just like every other newb, I made a few trades and won some BIG paper money. So it's been FX... just opened a live account. (25$!)

Stocks or futures... which is better? Just like nearly everything else in life it all just depends on the person... personality, time devoted, previous exposure, capital, risk limits, understanding, and marbles.

stefan_777 · May 13, 2009

Quote from ChkitOut:

Yes, just speaking in pct terms. You can get stopped out many times in stock world and make back your stops. In futs world getting stopped out repeatedly KILLS you because the volatility is just not there to get back to even.

You have to be right soooo much to profit from futues.

Most stocks trade in the direction of the index.
That's the point.

If you miss a move in the futures, chances are you'd miss it in most stocks, or vice versa.

Plus, if you want to get in and out, futures are way cheaper.

ChkitOut · May 13, 2009

Quote from stefan_777:

Most stocks trade in the direction of the index.

WRONG! Collectively stocks ARE the index. Stocks move the index not the other way around.

IShopAtPublix · May 13, 2009

One thing about Forex vs even major stocks (like google) is that major pairs in forex usually produce crisper charts. There is no crazy variation because of "open" and "close". And there is no incentive to manipulate the "close" because the action is fluid and it would take too much money to do so.

lindq · May 13, 2009

Quote from ChkitOut:

WRONG! Collectively stocks ARE the index. Stocks move the index not the other way around.

In theory, that's correct. But in practice, it can often be another story.

When trading equities, you can often be right on an entry in that particular stock, but crushed when the market (the index) moves against you.

For that reason alone I moved to trading the indexes a few years ago, and have been very happy with the move. I have no intention or need to ever touch another stock.

And regarding the OP, if he thinks he's having trouble trading an index, he'll get killed with individual equities. There are plenty of other ways to trade indexes these days without having to take on the leverage of a future, if that's a concern.

stefan_777 · May 13, 2009

Quote from ChkitOut:

WRONG! Collectively stocks ARE the index. Stocks move the index not the other way around.

I never said only one moves the other. I meant when you see a move in the index, you'll see the move in most stocks.

But the indexes aren't all encompassing, so they will initiate moves in stocks that otherwise have no reason to move. So saying that an index has no feedback or influence to some stocks at certain times is incorrect.

It's a mutual thing.

If you're not glancing at what the spiders/ES are doing when trading stocks, you're missing alot and you're probably doomed.

forsalenyc · May 13, 2009

been fighting with SPY for the past 6 months........partly in anticipation of trading ES later on. So far my thoughts are " how the hell do people make a living by trading ES?"

ES is so very very efficient and there's absolutely no free money. I'm slightly positive during my 6 month trial, but would have to agree that ES is harder than any individual stock.

neveragain · May 13, 2009

Quote from forsalenyc:

been fighting with SPY for the past 6 months........partly in anticipation of trading ES later on. So far my thoughts are " how the hell do people make a living by trading ES?"

ES is so very very efficient and there's absolutely no free money. I'm slightly positive during my 6 month trial, but would have to agree that ES is harder than any individual stock.

isn't that hard just have 500k account go on cmegroup to learn about index futures spread margins then combine
all inexes futures with XXX amount of RATIOS spreads
JUST BE OPEN MIND

Turhovach · May 13, 2009

Quote from ChkitOut:

Don't listen to these fools. Index futures are for losers.

I've been trading futures since 1994. In that time it's been my only job. I've paid off my house, car and motorcycle. I take fairly nice two week long vacations about four times a year and have no debt. Granted, its not a life of luxury, but to say that trading futures is for losers is one one of the most ridiculous statements one can make. Its been my experience that those making these kind of statements are usually those who can't trade futures worth a damn and therefore make the assumption that no else can either.

lindq · May 13, 2009

Quote from forsalenyc:

been fighting with SPY for the past 6 months........partly in anticipation of trading ES later on. So far my thoughts are " how the hell do people make a living by trading ES?"

ES is so very very efficient and there's absolutely no free money. I'm slightly positive during my 6 month trial, but would have to agree that ES is harder than any individual stock.

I've found that the biggest problem with most struggling index traders is that they try to fight it out intraday in very short timeframes. That's very difficult and IMO a terrible way to spend the day.

If that's your case, then back off and integrate some daily bars into your testing. There are definite patterns to be exploited when you start to get out of the trees and look at the forest.