A Day Trader's
Paradise:
Day Trading The E-Mini S&P 500 and Dow Jones Industrial
Average Indexes!
Many if not
most investors have opinions when it comes to forecasting
market direction. Day trading affords them the ability to
capitalize on those opinions, whether by the minute, half
hour, hour or day. But now, with fewer and fewer stocks participating
in the bull market, it’s getting more difficult to find the
"hot" stocks. The slimmer pickings are exacerbated
by an increasing tendency among the high fliers to grow, only
to crash and burn just as quickly. Narrow leadership and sector
rotation can make selecting winning stocks about as sure a
bet as finding that proverbial needle in the haystack. However,
wouldn’t it be a lot simpler and easier if, instead of trying
to mimic "Houdini" by conjuring up that one "hot"
stock, one could increase one’s odds of success by simply
trading the Index itself on the NASDAQ, Dow Jones Industrial
Average (DJIA) or the S&P 500?
And have the ability to enter and exit those markets in approximately
one second?
AN EXCITING ALTERNATIVE
Instead of paying thousands of dollars in commissions
and having to put up a fortune to buy all of the stocks in
the NASDAQ, Dow or the S&P 500, wouldn’t it make perfect
sense to participate in all the stocks comprising the NASDAQ,
DJIA or S&P 500 for a commission of under $10!
This is now possible because
of the DJIA, NASDAQ, E-Mini and E-Mini S&P 500 futures
contracts introduced by the Chicago Board of Trade and the
Chicago Mercantile Exchange. For example, in the E-Mini S&P
500 traders can participate in all the stocks of the S&P
500 with a margin deposit of approximately $3,563. (Or $500
per contract day-trading for qualified accounts)
Day trading margins are usually
only one-half the amount required for a position held overnight.
If you were day trading, you would be participating in all
the 500 stocks in the E-Mini S&P Index for a margin deposit
of only $1,700, and you could routinely expect to receive
your fill prices in under 5 seconds! (Or $500
per contract day-trading for qualified accounts)
CONTRACT
SIZES
| Specs
|
DJIA
Futures Contract |
E-Mini
S&P 500 Futures Contract |
| Size
|
10
times the DJIA. If, for example, the DJIA is trading
at 10,000, the value of the futures contract is $100,000.
|
50
times the S&P 500 Index. If, for example, the S&P
500 Index futures contract is trading at 1,400.00, the
value of one contract is $70,000. |
| Movement
Value |
Each
point in the futures contract is equal to $10. For example,
a move in the DJIA futures contract from 11,000 to 11,100
equals 100 points x $10, or $1,000. (Each one point
move in the DJIA stocks is approximately equal to a
one point move in the DJIA futures contract.)
|
Each
100-point move ("handle") in the E-Mini S&P
500 futures contract equals $50. A two "handle"
move from 1100.00 to 1102.00 equals $100. A one-half
"handle" move from 1100.00 to 1100.50 equals
$25. |
| Margin
|
$4,875 |
$3,563 |
The relatively small size of these stock indices
futures contracts permits investors with modest amounts of
risk capital to participate in the Dow and S&P 500—and
at a fraction of the cost of purchasing the actual stocks
outright!
BIG ADVANTAGE
Most day traders of stocks play the market only from the
up (long) side. But, with the E-Mini, NASDAQ, S&P 500
E-Mini and DJIA futures contracts, traders can just as easily
play the market from the down (short) side, too. This adds
an entire new dimension of opportunity for day traders.
ACTIVE DAY TRADING
With the sharp up and down moves in the NASDAQ, DOW and S&P
500, there are often ample trading opportunities to play both
the long and short side of the market several times
a day.
ELECTRONIC DAY TRADING
If you prefer
to electronically trade on your own, through the Internet,
our state of the art trading platform allows you to place
and receive your E-Mini NASDAQ and E-Mini S&P 500 and
Dow Futures fill price in seconds. From the time you place
your order, you can typically receive your fill price back
in seconds! This is almost instant execution and reporting
of your fill price—vital for day traders!
WIRELESS TRADING
Adding to the versatility in
day trading the E-Mini NASDAQ, S&P 500 and the DJIA futures
contracts is the option of trading wireless from a laptop
computer! You can almost instantly connect with our state-of-the-art
Order Entry System. You then can receive live quotes, keep
track of your account, transmit your order and receive your
fill confirmations in seconds! Now, whether you are at a party,
golfing, in your car, at a sporting event, or virtually anywhere,
you can day trade as conveniently as though you were sitting
in your office or home!
Past performance is not necessarily
indicative of future results. Transactions
in futures carry a high degree of risk. The amount of initial
margin is small relative to the value of the futures contracts
so that transactions are leveraged. A relatively small market
movement will have a proportionately large impact on your
account. This could work for or against you. You could lose
more than your initial investment.
SUMMARY
The E-Mini NASDAQ, E-Mini S&P 500 and the DJIA futures
contracts provide an exciting, highly versatile, efficient,
and economical means of capitalizing on the daily swings in
stocks. In day trading the E-Mini NASDAQ, E-Mini S&P 500
and in DJIA futures contracts, traders can focus on an entire
basket of stocks at a fraction of the cost of commissions
and avoid the expense of trading many individual stocks. At
the same time, traders can capitalize on both rising and falling
markets. There is no longer a need to tie up large sums of
money purchasing stocks! And, with online futures trading,
you can trade through the Internet and receive your fill prices
back in seconds. In day trading, you know exactly where you
stand at the end of each day without the risk inherent in
holding positions overnight. When day trading, each day represents
a whole new world of opportunity! Once you learn more about
the many advantages of day trading the E-Mini NASDAQ, E-Mini
S&P 500 and the DJIA futures contracts, you may not want
to day trade individual stocks again!
FREE INVESTOR'S KIT
Learn more about the E-Mini NASDAQ, S&P 500 and the
Dow Jones Industrial Average Indexes in our free "Stock
Indices Trading Kit." Easy to read and highly informative,
the kit contains practically everything you need to understand
and trade the E-Mini NASDAQ, E-Mini S&P 500 and the Dow
Jones Industrial Average Indexes! Some of the valuable free
brochures you’ll receive in the kit:
- E-Mini Contract Highlights
- E-Mini S&P Futures & Options
at the CME
- Questions & Answers on E-Mini S&P
5000 Futures & Options
- E-Mini NASDAQ 100 Futures
- Contract Highlights
- E-Mini NASDAQ 100 Q&A
- Statistical Data
- Facts On The Dow Jones Industrial Average
Futures and Options Contract
- Dow Jones Industrial Average Futures
& Options Introductory Strategies For Individual Investors
P.S. As an added benefit,
you can save up to 30%; in taxes on profits, in trading the
stock index futures compared to outright stocks (positions
held under one year)
Please be aware that
trading futures contracts involves the potential for unlimited
risk. |