Futures Leverage?

Hey Jon one thing that you can try versus trading one big contrac. Is to spread i.e. buying a dec corn selling a july corn. It takes a lot of risk out of the futures game. Spreads can e risky (i.e. Amarnath!!) but they are the only way I trade, you cap profits but you cap risk as well. PM me if you have any questions or want any ideas on anything I'm looking at
 
Quote from jonbig04:



A stupid and simple question for sure, but Im not sure why this entire forum automatically assumes im going to dump 100k into an account and start shorting crude futures...come on. I honestly think if someone came on here and said "whats a future?" A lot of you would say "dont ever trade one. go away now. your gonna get destoryed!!" lol we have to start somewhere guys, try to relax. I understand the risks involved in leverage....base on personal experience. I just didnt know how the leverage was applied in futures.

i doubt im going to become roadkill trading fake money....callmmmm down a little bit. Anyways thanks for the advice.
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I too was torn to shreds for asking a simple question last week. They assume one simple question means you don't know anything about anything. Comes with the territory I think, so don't take it personally.

You asked why trade futures. Here's why I trade them (index futures in my case):

- simple to trade (as far as the mechanics of placing orders go)
- as easy to go short as to go long
- always a good flow of dumb money coming in, due to the low account minimums and $400 day trade margins being offered by some brokers
- preferential (60/40) capital gains tax treatment
- better (IMO) to become very familiar with one instrument and trade it well than be all over the market looking for 'opportunities'

and lastly ...

- not subject to pattern day trading rule!

HTH
 
Quote from andrewbee:

- preferential (60/40) capital gains tax treatment
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Let's hope the attack on speculators along with the push for higher taxes from one Presidential candidate and the ruling party in Congress doesn't eliminate this.
 
Quote from jonbig04:

Haha thats helpful. Thanks.


BTW the bitch room is down the hall, be sure to wear knee pads.
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