What are the advantages of day-trading stocks over futrues?
- Thread starter qualcomtrader
- Start date
Let's face it, most here trade futes simply because they don't have the scratch for a PDT equity account. Stocks offer far more intra-day opportunity for a momentum/trend day trader. Futes often do nothing but chop all day while individual stocks are regularly trending 5-15%. To wit, the small cap names of late. Save up to get your 25k, then get a good filter like Trade Ideas and pick from the dozens of stocks trending every day.
You're right...and wrong...Lovey. Trending stocks offer less 'noise' than the e mini indexes, but futures offer the opportunity to leverage up without abiding by PDT rules. Unless a person understands where his particular circumstance resides, he is going to get hurt no matter where he places his bet. You've got to know what instrument you want to trade or get back to school.
Only wussies need to do hedge trading. Either run with the BIG DOGS or stay on the porch.
I do not have a friend who, do not know a friend who knows someone who, i do not run a hedge fund, i do not know a friend who knows a friend who runs a hedge fund, do not manage a 15 million account, do not know anyone who runs a 15 million account..............well you get my drift.
I do know this though.............scanning a shitload of different stocks and assuming they all have the same characteristics is a pipedream more than reality. Different stocks trade different, so do futures.
Technical patterns, support/resist etc, etc might look the same on a chart but that in no way means they all move in price the same. If anyone does not recognize this then they need more potty training.
I do not have a friend who, do not know a friend who knows someone who, i do not run a hedge fund, i do not know a friend who knows a friend who runs a hedge fund, do not manage a 15 million account, do not know anyone who runs a 15 million account..............well you get my drift.
I do know this though.............scanning a shitload of different stocks and assuming they all have the same characteristics is a pipedream more than reality. Different stocks trade different, so do futures.
Technical patterns, support/resist etc, etc might look the same on a chart but that in no way means they all move in price the same. If anyone does not recognize this then they need more potty training.
Yeah, it's clear you haven't studied how futures work. Only 2M traded on the ES and that's not enough for you? Get a futures demo account and see if that ES is big enough for you...
Then read this:
Future pros -
Liquidity
24 hour access
Tax treatment
Less susceptible to sudden large % decreases in value (e.g. no earnings warnings, mgmt or accounting scandals)
Leverage
Futures cons -
Some days there are few or no good set ups
Leverage
Stocks pros -
Endless number of charts - can continually scan for charts or situations to find something that fits your risk/reward
Can be more interesting relative to futures for those that like to keep track of industries, company specific stories, themes, etc
Can swing trade over longer time horizons than futures
Dividends
Easier to hedge
Stocks cons -
May be at a disadvantage if ...
you do not enjoy or appreciate fundamental analysis
you do not have corporate finance knowledge to quickly process impact of announcements/ developments on stock prices
you don't know the name you are trading
Liquidity
24 hour access
Tax treatment
Less susceptible to sudden large % decreases in value (e.g. no earnings warnings, mgmt or accounting scandals)
Leverage
Futures cons -
Some days there are few or no good set ups
Leverage
Stocks pros -
Endless number of charts - can continually scan for charts or situations to find something that fits your risk/reward
Can be more interesting relative to futures for those that like to keep track of industries, company specific stories, themes, etc
Can swing trade over longer time horizons than futures
Dividends
Easier to hedge
Stocks cons -
May be at a disadvantage if ...
you do not enjoy or appreciate fundamental analysis
you do not have corporate finance knowledge to quickly process impact of announcements/ developments on stock prices
you don't know the name you are trading
Quote from brownsfan019:
Yeah, it's clear you haven't studied how futures work. Only 2M traded on the ES and that's not enough for you? Get a futures demo account and see if that ES is big enough for you...
Then read this:
Well, I read both of your messages but I'm wondering from your point of view, can you easilly make $10,000 to $100,000 a day in futures? Because from what I read in the liquidity thread in the Forex trading forum, you'd be able to trade large enough to make that much easilly in Forex.
By the way, I'm not implying to anyone that I can make that much. I'm still trading a single mini lot in Forex.
well just think about the YM, which is the mini-dow, for each point on each contract you make $5
so with 10 contracts and a +100 day you'd make $5,000
Theoretically if you had $500 per contract daytrading minimums you could do that with only $5,000 in your account so that's really some crazy leverage. That wouldn't be recommended at all but with let's say $20,000 or so in your account you could trade that many contracts and still absorb several losses without too much problem but I'd still probably just stick to 3 or 5 contracts