Forex and Futures

I trade forex, futures, stock and options. Between forex and futures, the article does point out positive aspects of forex vs other markets. However, they can be a double edged sword.

Take liquidity for example. It's true that the forex market is more liquid than futures. However, with so much liquidity comes more market efficiency. With more market efficiency comes less opportunity for you to have an edge that will make you money in the long run. My trading experience and thousands of backtests across both of those markets convinces me the low liquidity of the futures market is an advantage, not a disadvantage. Of course, if liquidity is too low you are going to have problems with your order executions, so find the futures contracts with enough liquidity, but no more.

Ian
 
Also: Commissions: My futures commissions with Interactive Brokers are not meaningfully different from the forex commissions they charge me. Brokers with no commissions simply get their revenue through a higher spread. Overall spreads are a little better in forex than futures, but this is only of significance if you are a scalper. My opinion is that if you scalp, then you are in a more efficient part of the market than if you trade the higher time frames. Again, this I concluded from thousands of backtests.
 
Yes ok, i dont wanna someone misundestood me. It is possible to win in forex and in any current pair (probably). Cost are very low, except algo trading,it is difficult to catch all the movements for a beguinner. Knowing how to trade, you can win even with a 5 spread in eur/usd, but you need a very high success rate wich is not common in beguinners. =)
 
The two markets are as pointed out by others equivalent in many ways. I agree that you should choose one of the two and stick with it. Make the decision based on your personal preferences -- trading hours, capital requirements, etc. Good luck!
 
ianlav said:
I trade forex, futures, stock and options. Between forex and futures, the article does point out positive aspects of forex vs other markets. However, they can be a double edged sword.

Take liquidity for example. It's true that the forex market is more liquid than futures. However, with so much liquidity comes more market efficiency. With more market efficiency comes less opportunity for you to have an edge that will make you money in the long run. My trading experience and thousands of backtests across both of those markets convinces me the low liquidity of the futures market is an advantage, not a disadvantage. Of course, if liquidity is too low you are going to have problems with your order executions, so find the futures contracts with enough liquidity, but no more.

Ian
More...

You hit the point! Less leverage doesn't mean problems with execution but rather says that movements there are more predictable and less factors affect the price than on world-traded Forex. I tend to trade futures but there is still plenty opportunity to track correlations on FX market between currency and significant market events, thus make predictable bets. Even I don't go beyond my broker - use Hotforex calendar with statistical tools on PC to make analysis.
and it goes pretty good like that.
 
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