Why would anyone trade spot fx

Quote from Went Fishing:

Why would anyone trade spot fx?
IMO, it's because you can start out "being a trader" with a very small trading account. Results may very!

I like to keep things simple, if I have two accounts 1) Cash & 1) Future and I place the exact same trade in both accounts.... Buy 1 Euro @ 1.3500 and the trade is GOOD and I Sell 1 Euro @ 1.3510 to close the trade, what are my results?

Futures Account: 10 points X $12.50 = $125.00
Cash Account: 10 point X $10.00 = $100.00

Figure any reasonable commission (or pip spread) you wish ... You don't have to be a mathematician to analyze the results.

Why wouldn't you trade futures, leaving reasonable commissions and/or pip spreads out of the equation, for every 4 successful future trades (per...example), the Futures Trader is one trade ($100.00) ahead of the Cash Trader (in profit).

I think the REAL question is, How many Cash Forex accounts have less than $7,520.00 (required margin for Eur/USD futures) in them? :eek:
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Overnight margin for 6E is not $7520, a lot of spot EUR/USD is €100000 and 6E is €125000 that's why there is a difference in tick value. Your have no idea what you are talking about.
 
Doesn't the fact that almost all -- if not all -- the Forex houses that handle one and two thousand dollar accounts are thieving whores who reach in and steal the clients funds as if they were pickiong grapes mean anything to you guys. C'mon .... tell these new guys the reality.

I'm not talking about IB or some of the larger brokers but so many are so dirty it is crazy not to execute on the CME.
 
Quote from PIPMAGIC66:

i hate paying a commiss on top of a spread too so I spot trade.
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I can only chuckle reading Pipmagic's and Wentfishing's posts...

Please do yourselves a favor and educate yourselves a bit.


:eek:
 
This is true, but I guess the downside is that on a losing trade, you will lose $ 125. The only solution, I guess would be to risk 9 vs reward 10.


Quote from Went Fishing:

Why would anyone trade spot fx?
IMO, it's because you can start out "being a trader" with a very small trading account. Results may very!

I like to keep things simple, if I have two accounts 1) Cash & 1) Future and I place the exact same trade in both accounts.... Buy 1 Euro @ 1.3500 and the trade is GOOD and I Sell 1 Euro @ 1.3510 to close the trade, what are my results?

Futures Account: 10 points X $12.50 = $125.00
Cash Account: 10 point X $10.00 = $100.00

Figure any reasonable commission (or pip spread) you wish ... You don't have to be a mathematician to analyze the results.

Why wouldn't you trade futures, leaving reasonable commissions and/or pip spreads out of the equation, for every 4 successful future trades (per...example), the Futures Trader is one trade ($100.00) ahead of the Cash Trader (in profit).

I think the REAL question is, How many Cash Forex accounts have less than $7,520.00 (required margin for Eur/USD futures) in them? :eek:
More...
 
Quote from oraclewizard77:
This is true, but I guess the downside is that on a losing trade, you will lose $ 125. The only solution, I guess would be to risk 9 vs reward 10.
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Ok, Ok ... I get it!!

I'm sorry my post was misinterpreted by so many. I'm well aware of contract size and tick value, this was not my point. The idea I was trying to point out was, If I'm going to invest the time and effort of studying either market and enter a position, I choose the Futures market since it is a larger contract and offers more data for analysis.

As for my required minimum figure, I am aware the dollar figure is incorrect. When I wrote this post it seemed somewhat "Hershey" like and I edited it dramatically, I didn't notice the error until the responses started to flow, and at that point the window of opportunity to edit the figure was closed.

So have some ET fun at my expense :( and good trading to you, whichever market you choose.
 
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