Why is Day Trading Emini Stock Index Futures good for beginners?
Submitted: 29 Sep 10 14:49
 

Trading Emini Futures is a cost effective way to start your adventure in the world of trading.. The US Based Emini futures tracks the price of their full size. Take the very popular Emini S&P (Standard and Poors) futures. Per tick move of the price of the full size S&P Futures  is 5 times more of that of the E-mini version. By trading the Emini version, your outlay and capital risk is thus greatly reduced.  The US market is also extremely liquid which means you will have no problem getting out of the market when you want to.  That means you will not get stuck with a position as there is a shortage of buyer or seller.

Another advantage is the very low commission and account opening requirement (As low as USD 3000) that is charged by a typical US-based broker. A roundabout trade may cost you only US4.50 per contract and it is the low commission that enables you to go in and out of the market quickly and frequently.

On top of that, most brokerages also provide free market data and charting software and they often have order management platforms that are very easy to use.

All you need now is a sound trading system, and you may begin your quest for trading success.

 

 

 
Lost and Happy. Won but Not.
Submitted: 23 Sep 10 17:02
 

Successful trading is not just about wining big. Successful trading is MORE about having the ability to win consistently than anything else. The successful trader wants to know that he CAN repeat that action and thought process that brought about that winning trade.

Trader A

Trader A is frustrated with his system. He just lost 5 trades in a row. Not an especially bad streak but he is feeling helpless and his self talk is casting doubts on his system that has brought him considerable success over  the past few months. After being stopped out again, he is eagerly looking for a way to recoup his losses. Any way at all. As he stares at the ticking charts, he has this feeling that the market is turning. No clear signal, it is just a gut feel. He rationalizes it with some excuses for this trade and sends the order. Order filled, market turned. It just happened at that instance earnings reports were announced and that pushed the market his way. He recoups all his losses plus some profit to keep.

Trader B

Trader B just had 2 losing trades yesterday.

“Today is a new day and it will all be good!” He assured himself.

9:30.

Market opens, and after an hour, he took another hit. He is now having doubts about his system and stares intently at the charts, chasing every tick of the price movement. He has the urge to take a gamble and take a trade based on gut feel. Just before he clicks, he stops himself and he is relieved he did not commit the sin of taking random untested trades.

Few minutes passed and a trading signal appeared. Without hesitation, he clicks and sends the order to go long. Next thing he knows, his laptop beeped and he was stopped out again.

Aftermath

Trader A won but he wasn’t happy. He knew he cannot duplicate this winning and it was all due to luck. On top of that, he broke his rules and allowed his emotions to rule his trading.

Trader B lost but he was pleased that he traded well. He knows that the key to be a successful trader is to be able to face his fear and take the right actions. He did what he was supposed to and he stopped himself from making a key mistake. He knows the system had been tested vigorously and it had worked very well for the past one year. He knows that the law of numbers will kick in and he will get his winning trades very soon. He knows he has probability on his side.

A successful trader is not bothered by a temporary dip in his account. He is not affected by a couple of losses. The good trader’s main objective is to do what is right when a trade comes and let his system works for him. His comfort comes from the trust he built as he saw with his own eyes how the system had served him. He knows he can repeat his winners and not leave anything to luck.

 

 

 
Is Paper Trading Important?
Submitted: 13 Sep 10 15:40
 

Paper trading (or simulated trading) is vital for a trader to practice and test out in real time a strategy without the risk of losing money. It is also useful if a trader finds that he is losing his discipline and confidence, he can paper trade for a short period to regain confidence in his trading system and his ability to put on winning trades.

However, there are some traders who are always hiding behind the safe realm of paper trading and reluctant to start Live trading despite being extremely profitable on paper. The common excuse is often :I am not ready yet, so let me make sure I can make money from this.

He will never be ready.

The trader who thinks like this is immersing himself in self deception and wasting precious time and potential money. Trading is a very personal endeavor and being honest is crucial. In the case of the above trader, his problem is not about being ready but more of the lack of courage and the fear of being proven wrong in case he starts to lose real money.  Besides, as the paper-trader is trading with no stress of losing real money, he will tend to perform well. Thus, it is important that once the system has been proven on paper, we understand that the real ‘training’ starts from your very first Live trade.