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
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Specs
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DJIA Futures Contract
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E-Mini S&P 500
Futures Contract
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Size
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10 times the DJIA. If, for
example, the DJIA is trading at 10,000, the value of the
futures contract is $100,000.
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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.
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Movement Value
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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.)
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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.
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Margin
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$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.
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