E-mini Futures - What are they?
These are contracts that are electronically traded. They are called 'E-mini', in that they are smaller size versions of the larger contracts traded in the futures pits by the floor traders. Thus, the normal, little guy can participate in trading these great instruments.
E-mini futures contracts are based on the underlying index, such as the S&P 500, S&P 400, DJI, Russell 2000, and so on. It is much easier to buy and sell futures contracts, rather than buying and selling individual stock shares.
The many advantages of trading E-mini futures:
- Leverage
Using the E-mini Midcap contract (symbol: MC) as an example, each point of contract move is worth $100 per contract traded. To trade 1 contract only requires about $1000 - 2000 of margin in your trading account.
All futures markets move up and down a lot during the day, giving many opportunities to trade for these types of point gains. These trades usually just take a few minutes and you are done.
- Easier than stocks
When you trade futures, you are trading based on the overall, broad market movements. When you trade a stock, it can move up or down on it's own, with or against the market trend. Also it is not easy to 'short' stocks, but you can do that any time you want with futures. With stocks, the best margin you can get is 50% and you need a whole lot more money to trade with.
- Daytrading hours
The futures hours are from 9:30 AM to 4:15 PM EST, 5 days per week. When you daytrade, you are out of all your positions before market close. This limits your exposure to world events which may occur during the night or on weekends. Brokers have low 'daytrading' margins for futures. You can stay in your futures positions overnight and on weekends, but you are required to carry much larger account margins. Why do that?
The CME Forex futures (futures on the currencies) run all night and are another option to you.
- Great liquidity
The S&P E-mini futures routinely clear large trades of over 100 contracts at a time during the regular session. Other futures have less volume, but still allow a trader to trade normally. Another option is to trade European futures, like the DAX or EuroSTOXX futures.
- Tax advantages
A quick call to your tax person, will have you convinced to switch from trading stocks to futures!
- Trade LONG or SHORT - BEAR or BULL markets
Futures have no shorting restrictions and are traded either way, at any time, with no difference. In fact, falling markets make 'nice runs down' to capitalize on!
What are the USA E-mini futures contracts we trade?
- S&P 500 with a symbol of ES
Point value: $50 per contract
Minimum tick: $12.50, or 4 ticks per point
- Russell 2000 with a symbol of TF
Point value: $100 per contract
Minimum tick: $10, or 10 ticks per point
- Midcap 400 with a symbol of MC
Point value: $100 per contract
Minimum tick: $10, or 10 ticks per point
- Dow Jones with a symbol of YM
Point value: $5 per contract
Minimum tick: $5, or 1 tick per point
- Crude Oil with a symbol of QM
Point value: $500 per contract
Minimum tick: $12.50, or 40 ticks per (per $1 dollar move)
- Nasdaq 100 with a symbol of NQ
Point value: $20 per contract
Minimum tick: $5.00, or 4 ticks per point
How much money is needed to get started?
You can open accounts with as little as $500, depending on the broker. You would really want to open with at least $5000, as trading on the edge will affect your trading and your judgement. This should never be money that is earmarked for something else important.
How do I learn to use Conceptforex softwares?
With many other trading companies, you spend weeks and months 'learning' to analyze and study this and that, and then when a trade situation presents itself, you are then 'second-guessing' yourself, and wondering what to really do. This is STRESS!
Our softwares have already incorporated many of these difficult indicator studies, correlated symbols and charts, into a single software and a single signal for you to take.
How much time each day do I need to be at my computer?
The primary time to get good signals is when the markets open up in the morning. The next 30-60 minutes, give the best (on the average) signal of the day, before settling down to what is called the 'dull-drums', a period of time where price does not move a much. Sometimes, before a big expected news release (FOMC interest rates), the markets can also be flatter, and you can take the day off.
There is a series of 'times' well known in the emini futures world. View them here
How many trades each day do I get?
On the average, you get 2-4 good signals in the first hour of the session. This is more than enough to get your 'goal ticks', as seen in our many videos. In general, we use the term goal ticks to mean getting 7-10 ticks in the MC or TF..
How do I know how many contracts to trade each time?
As important as the system itself, is 'Trade Management'. First of all you need to enter a trade ALWAYS with a protective stop loss (SL). Most modern brokerage platforms allow for automatic 'bracketing' of your entry with both of these parameters, so it is very easy and is automatic for you.
Let's go through an example using the Midcap 400 futures (MC)
- Each tick is worth $10 and your initial SL is 10 ticks, for a risk of $100 per contract
- Your trading account has $20,000 margin
- You risk a conservative 2% maximum on any given trade
- 2% of $20,000 = $400 risk
- Since 1 contract risk = $100, you can trade 4 contracts
- With 4 contracts, each tick is worth $40 and a 10 tick SL = $400
Other than some startup money, a computer, and time, what else is required?
You just need 3 personal attibutes to succeed:
- Discipline
To not deviate from doing the same thing with each and every trade. Know when to take a day off when you see the market is not behaving or there is some wild world event going on.
- Patience
To wait for the proper quality signals and never push the trade or yourself.
- Desire
Remember, you can do anything you want, if, you really want to.
Getting started list
Ok, so I am ready to learn how to trade, I am patient and willing to take the steps in the right order to be successful, knowing that I can now be financially independent for the rest of my lift. Let's do it!
- If you know absolutely nothing about the markets, that is ok. Go to the bookstore and get a basic book on Futures and/or Forex Currencies if you want to learn that also. There are even the 'Dummies' books out there on these subjects. You can be reading these at your leisure, while you are learning the software, charts and brokerages.
- The charting software that our software runs in, is called eSignal ( www.esignal.com ) Obtain your free 30 day subscription to their PREMIER DATA FEED. Esignal has many tutorials on how to use the charts and we include some instruction in our online Help files here.
For your Free month, contact Scott Wilks below - mention CONCEPTFOREX
- 1-800-322-1910
- 1-510-266-6000 x.1629
- swilks@mail.esignal.com
- Visit our download page and complete steps 2 and 3 for your Free 7 day trial. When we receive your esignal USERNAME that you obtain on esignal data feed signup, we will then active your trial period.
- Now is the time to go through our entire online Help file, maybe several times. View at least 25 of our online videos at: www.youtube.com or www.conceptforex.com. Get a chart or 2 up and running right away and begin to watch in real time, especially at the open.
- Visit the exchange of the contract you wish to trade, see them here.
- You can use any broker/platform you wish, but here are some ideas for you:
- Platform
Ninjatrader. This can instantly bracket your trade on fill, then automatically manage your trade with trailing stops and more. Our Interface Module, if you want to use it, only interfaces with Ninjatrader. URL: www.ninjatrader.com You can get a simulation version FREE and immediately and begin to enter trades as you see them on Autopro.
- Brokerages
Global Futures
Infinity Futures
- Platform
- Practice and practice - paper trade
Spend your time at the computer really planning on the signals being entered as real money trades. Too many people 'paper trade' in a manner that is worthless, in that you would never do this or that with real money on the line. When you understand the software, the signals, and your hand-eye coordination with the platform is good, then you can progress to real money. You should be doing well in your simulation account.
You could be ready and able in 4-6 weeks if starting as a complete novice.
Welcome aboard!