Trading FUTURES with IB
- Thread starter fullautotrading
- Start date
Well much depends on the style of trading.
If one makes single bets with tight stops of course can trade with a relatively small capital even futures. You just need the margin and the DD you allow. But i would never do that (as far as i know, there is no way to make that game <b>algorithmically</b> profitable)
In my approach, it makes no sense trading futures if one does not have a good capital.
This is because i work essentially with instrument overlaying to provide an hedging action.
It's like watching at the price range and imagining "corridors" in it.
When the price changes corridor, we start a new layer and in time the horizontal scalping action compensates for the price shift.
In time, scalping and occasional reverses essentially determine the profit.
So it's a game of diversification and overlaying. The size of the futures is just too big to allow that with small capital.
With ETFs one could manage better a relatively smaller capital with this kind of approach, as small orders can be issued, and possibly increased in time.
But futures are certainly <b>much</b> more fun ;-)))
Tom
If one makes single bets with tight stops of course can trade with a relatively small capital even futures. You just need the margin and the DD you allow. But i would never do that (as far as i know, there is no way to make that game <b>algorithmically</b> profitable)
In my approach, it makes no sense trading futures if one does not have a good capital.
This is because i work essentially with instrument overlaying to provide an hedging action.
It's like watching at the price range and imagining "corridors" in it.
When the price changes corridor, we start a new layer and in time the horizontal scalping action compensates for the price shift.
In time, scalping and occasional reverses essentially determine the profit.
So it's a game of diversification and overlaying. The size of the futures is just too big to allow that with small capital.
With ETFs one could manage better a relatively smaller capital with this kind of approach, as small orders can be issued, and possibly increased in time.
But futures are certainly <b>much</b> more fun ;-)))
Tom
I have been playing on a <b>REAL</b> account with a list of ETFs and the VM (the "small" VIX), along with a few options.
This has allowed me to make a selection of some of these ETFs, which seem to move in a decent manner and have enough volume.
I have included the list in my app for anyone interested.
The test is now restricted to about 95 instruments and since there isn't really much money in this account, i have been keeping the orders size very very small (from 1 to 30 shares)
Clearly, this means a boatload of commissions and i think at IB they are cheering about test like these ;-)) as i made already almost 500 bucks in commissions alone in about a month! LOL (Well the orders were ridiculously small: just a test)
On top of that i also made a profit of almost 1K using a max margins of about 15K.
This is a summary picture of the trading. The vertical line indicates where some instruments (expired options, etc) have been <b>removed</b> and on the right there is a summary account of the removed amounts.
Well this small test with real $$$ has indicated that trading ETFs feels * a lot * different from trading futures. Futures are somehow more fun. Problem is that to trade with this style (layered), with a lot of risk diversification, requires very decent capital.
ETFs are certainly good for relative small capital as they allow a lot of risk diversification (clearly overpayed in terms of commissions, if orders are small), which is good. Futures granularity seems too big for relatively small accounts (for this kind of game).
<img src="http://www.elitetrader.com/vb/attachment.php?s=&postid=3508862" width="1000" />
This has allowed me to make a selection of some of these ETFs, which seem to move in a decent manner and have enough volume.
I have included the list in my app for anyone interested.
The test is now restricted to about 95 instruments and since there isn't really much money in this account, i have been keeping the orders size very very small (from 1 to 30 shares)
Clearly, this means a boatload of commissions and i think at IB they are cheering about test like these ;-)) as i made already almost 500 bucks in commissions alone in about a month! LOL (Well the orders were ridiculously small: just a test)
On top of that i also made a profit of almost 1K using a max margins of about 15K.
This is a summary picture of the trading. The vertical line indicates where some instruments (expired options, etc) have been <b>removed</b> and on the right there is a summary account of the removed amounts.
Well this small test with real $$$ has indicated that trading ETFs feels * a lot * different from trading futures. Futures are somehow more fun. Problem is that to trade with this style (layered), with a lot of risk diversification, requires very decent capital.
ETFs are certainly good for relative small capital as they allow a lot of risk diversification (clearly overpayed in terms of commissions, if orders are small), which is good. Futures granularity seems too big for relatively small accounts (for this kind of game).
<img src="http://www.elitetrader.com/vb/attachment.php?s=&postid=3508862" width="1000" />
Update on the ETF test. All proceeding fine:
Diversification
Layering
Hedging
After this one, I will be selecting a folio of good stuff for the people wishing to trade these guys.
If you have some candidate to add, just suggest them. I will add it ...
<img src="http://www.elitetrader.com/vb/attachment.php?s=&postid=3511091" width="1000" />
PS
(making a few changes to the interface in the meantime and adding some more features)
Diversification
Layering
Hedging
After this one, I will be selecting a folio of good stuff for the people wishing to trade these guys.
If you have some candidate to add, just suggest them. I will add it ...
<img src="http://www.elitetrader.com/vb/attachment.php?s=&postid=3511091" width="1000" />
PS
(making a few changes to the interface in the meantime and adding some more features)