-
Trading Stocks vs. Futures
17
September 7th, 2011Uncategorized
I do not doubt the legion traders who say great success with options and stocks.
But neither of these investments meets the factors for a superb day trading instrument for me.
Why? The issue in day-trading stocks for me is the absence of leverage available to maximize profits. Regulation T is currently set at fifty p.c, meaning your margin account must contain at least fifty percent if the net price of your holdings at every point. You have got some leverage, I believe, though not enough to gorge my hunger for profits.
in general, stocks are not quite so haphazard as the index futures contracts, and the one mandatory requirement for generating cash, major profits, is volatility. Put in simple fashion if the stock doesn’t move seriously, you are forced to wait until it does.
I don’t hold any day traded stocks overnite, so commission costs are a genuine concern in derivatives trade stocks. No, I need something with some real volatility to day trade. You may disagree that Penny Stocks supply the mandatory price movement to daytrade. But many penny stocks are of dubious price and getting correct information regarding a penny stock can be a strenuous excitement. Further, the market maker in a penny stock could be the company itself, or stand in market maker closely tied to the penny stock company. The final result can be some moderately wide bid / ask pricing, which is exceedingly common. No, I desire in public traded investment instruments with a high level of transparency for my trading. Options are a fantastic way to hedge a current holding in your portfolio, but they can be less than satisfactory for a beginner trader, or an intermediate trader. There are some superb traders who reasonably well with options, but generally, my experiences with option dealers finds an especially sad crew.
There are a few variables to address in option dealing, strike costs, expiry dates, price rot, to name a pair. I don’t like the chances, and option dealers are generally disappointed in their results. Futures give me an instrument with satisfactory liquidity, a clear market, and masses of price action to profit. Naturally, because there is a load of price movement should not be a warranty of profits. You need to be on the right side of the price movement to earn money, and that chore can be tough. But the potential is there, and I have made a living many years in the futures markets with good success. I will not say my endeavors with stocks and options, in a daytrading sense, are almost as successful.
Related Reading:
Tags: day trading stocks, futures contracts, index futures, instrument, leverage, maker, mandatory price, penny stocks, trading, volatility
![Scale mech util 250x1lb each [PRICE is per EACH]](http://ecx.images-amazon.com/images/I/21WievRXtVL._SL75_.jpg "Scale mech util 250x1lb each [PRICE is per EACH]")
17 responses to “Trading Stocks vs. Futures” 
-
Janet Woods November 18th, 2011 at 01:01
Major thankies for the article.Much thanks again. Keep writing.
-
Thanks again for the article.Much thanks again. Keep writing.
-
A big thank you for your article post.Much thanks again. Will read on…
-
Benjamin Cox December 9th, 2011 at 21:17
I think this is a real great post.Really looking forward to read more. Really Cool.
-
Howard Flores December 14th, 2011 at 08:34
Thanks a lot for the blog.Much thanks again. Will read on…
-
“Say, you got a nice article post.Really thank you! Really Great.”
-
Thanks for the article post.Really looking forward to read more. Fantastic.
-
Marilyn Holmes January 23rd, 2012 at 03:34
“Appreciate you sharing, great blog.Thanks Again. Awesome.”
-
Really informative blog.Really looking forward to read more. Great.
-
Lois Lopez February 13th, 2012 at 16:00
“Great, thanks for sharing this blog.Really looking forward to read more. Really Cool.”
Financial Services, Financial, Finances, Organizing Finances, News
- DHS to launch insurance and finance program - Demopolis Times May 18, 2012DHS to launch insurance and finance programDemopolis Times“The Demopolis City School System applied and obtained funding in the Finance Cluster and th […]
- Huakan International Mining Inc. Appoints New Chief Financial Officer - SYS-CON Media (press release) May 18, 2012Huakan International Mining Inc. Appoints New Chief Financial OfficerSYS-CON Media (press release)She was previously Director of Finance for InterWrap […]
- Rockall Technologies Enhances Trade Finance Team - SYS-CON Media (press release) May 18, 2012Rockall Technologies Enhances Trade Finance TeamSYS-CON Media (press release)The company has achieved 100% client retention and reference-ability and […]
- India Revises Budget 2012 Proposals; Clarifies Retrospective Amendments ... - SYS-CON Media (press release) May 17, 2012India Revises Budget 2012 Proposals; Clarifies Retrospective Amendments ...SYS-CON Media (press release)By Business Wire The Indian government has pro […]
- OneWire Shares Insight on Financial Services Career Opportunities to Service ... - SYS-CON Media (press release) May 17, 2012OneWire Shares Insight on Financial Services Career Opportunities to Service ...SYS-CON Media (press release)NEW YORK, NY -- (Marketwire) -- 05/17/12 […]
Ronald Burns November 6th, 2011 at 05:02