Do you think futures are easier than options?

[tassi13827]

This kind of reminds me of the euphoria problem inherent in newer traders.
If you are the 5% exception then it's good for you.
If you cut losers early, this means you have a high percentage of losing trades. Do you ever double up?

I have traded the YM for the last 6 years with the same strategy.

If I may ask, what is that strategy you have used for the last 6 years and what is your % of wins?


TIA
Tassi

 

[Mike boschert]

If I may ask, what is that strategy you have used for the last 6 years and what is your % of wins?


TIA
Tassi

Hey I am a static ally HEDGED seller of options on futures. I have no reason to say what my returns are. But I will say statistically my returns, with zero yearly drawdowns since at least 2002, are highly abnormal. What is your trading style. Good day

 

[Mike boschert]

It only took me 30 years of study, observation, theorizing,modeling, trading my money twice,losing my money twice,thinking,learning all on my own, etc, etc. to figure out something that really works. Nobody will sell you a model, write you a book telling you what really works.If their model worked they wouldn't need to take your money. It really really sucks tha amount of money, blood , sweat and yes tears to to make your own discovery. Barton Biggs said this" over time you develope a knowledge base, then out of the blue a new piece of information or thought triggers an idea and you just discovered an investment opportunity. I don't believe it is something you can force, eventually it may happen. The amount of corpses littering the battlefield of investing is staggering.

 

[SpearPointTrader]

Out of 5 days of the week I probably have 1-2 losing days and 2 losing days is rare for me in 1 week. I never hold a position for more than 15 mins which is why I think I don't have many losing days. If I have a losing trade I cut the position and will usually come back above. How do you trade futures?

I prefer to be in, and out myself. I like to enter in the direction of massive momentum. if it does not instantly do what i think it should, I exit. Often I end up with very small, hardly clears commission wins instead of losses that way. however, do to my rapid exit, my wins are generally small too (100 trades average out to be +$84 each trade)

I am generally not in more than 3 bars on the 10 min. Usually, it's only 1 or 2 bars. Unless I am intentionally trying something new, the longest I am ever in is 3 bars on a 30 minute chart.

The markets generally chop around most of the time. Then make a move in the direction of the trend over a fairly short time period, then chop around the rest of the day. So, once I catch that move, I want out.

 

[SpearPointTrader]

I think that trading futures is way easier than trading options. I know this does not apply to everyone, but I feel that futures, specifically emini sp 500 contracts are incredibly profitable. I basicly scalp all day and pull in about $850 a day. Whats your guys take on this?

I tend to agree. However, my agreement is based on the fact that my forte is daytrading futures. I only know simplistic options strategies, most are better off used to cover futures contracts as insurance than anything. If you get a guy who is good with options, he's going to disagree with us.

 

[TheLord]

I tend to agree. However, my agreement is based on the fact that my forte is daytrading futures. I only know simplistic options strategies, most are better off used to cover futures contracts as insurance than anything. If you get a guy who is good with options, he's going to disagree with us.

Thanks for the reply. How long have you been trading futures? Whats yours strategy?

 

[SpearPointTrader]

What you mean by easier ? yes its easier you just buy or sell unlike options but are you going to make money trading futures ? Doubt that . Options trading isn't easy you should know exactly what are you looking for , that being said options is the way to go its much more profitable than trading outright futures ...

Well, I have had many, many conversations with options traders, and I have yet to find one who can make more money that a straight futures trader.

What I have found, is that the guy who knows his forte the best, makes the most, regardless of what he is trading. It's skill *In* your area of expertise that matters, not the area of expertise itself.

 

[SpearPointTrader]

Thanks for the reply. How long have you been trading futures? Whats yours strategy?

I put my first real money trade on in 1995, or 96 (the year after that huge grain run up).

As for strategy, thats tough. I wrote a whole 350 page course trying to teach it once. It would take a year to really get all the details, I am sure.

That said though, I use basic consolidation patterns (Think Ken Roberts stuff) to identify markets ready to move, but then enter and manage my trades off of a few specific entry signals based around the way the 4,9, &18 bar moving average all relate to the Bollinger bands and the price.


Futures & Commodities trading is High Risk due to highly leverage markets. PAST PERFORMANCE IS NOT NESSAASARIY INDICATIVE OF FUTURE RESULTS.

 

[Mike boschert]

Hey fellows. I traded futures twice. I started out using options as a hedge against my futures contract. The first time I did it I got a margin call. Reason it takes more than one options contract to fully hedge the futures position.they don't move at the same pace. Options are the lagger. Are options easier than futures? Staying power comes from being hedged. Staying power is the key to trading, especially futures. The market makers move these markets more than any other, my opinion. If you use options as a means to obtain staying power things happen. You can make money on your futures position and potentially make money on your options position on a reversal. You get the opportunity to trade futures with LImITED downside. If the market comes back to where you entered your futures position you can do it again, your hedge is already in place. Why waste money hedging. I have never made an unhedged bet in over 8 years. I have never had one drawdown year yet. I trade options only. I found an edge in this arena that I exploite. If I was to say any hedged position is better than unhedged. Look for a way to incorporate hedging in the model you trade. Worste case you get staying power and your position gets time to become profitable. If the market goes against you get out of futures position let the option ride. You get the opportunity to play both sides of the market. You also eliminate unwanted losses and risk of ruin. Buy your hedge for x amount of time pay once for it use it for daily trading. Always hedge.

 

[A Dashing Blade]

I traded futures twice . . .

Right . . . .?

I started out using options as a hedge against my futures contract.

. . . whareas most pro's do the exact opposite . . .

The first time I did it I got a margin call. Reason it takes more than one options contract to fully hedge the futures position.

. . . er . . . obviously (unless the option is deeply ITM)

Are options easier than futures? . . . Staying power is the key to trading, especially futures. . . . Worste case you get staying power and your position gets time to become profitable.

Which is to say that you run your losers . . .

When trading futures "all" you have to do is work out twhere the wiggly line is going next

When trading options, you have to work out where the wiggly line is going next and BY WHEN it's going to do that.

Ergo, trading options is more difficult thatn trading futures.

 

[SpearPointTrader]

When trading futures "all" you have to do is work out twhere the wiggly line is going next

When trading options, you have to work out where the wiggly line is going next and BY WHEN it's going to do that.

Ergo, trading options is more difficult thatn trading futures.

Agreed.

 

[Mike boschert]

Hey traded futures twice for 8-9 months each. Traded every day. Traded the night desk. It was a horrible delightful endeavor. Unhedged futures contracts is Deffinently where the adrenaline gets flowing. I blew up twice, my money. I started with less than 100k and made and lost on average 4000$ day. Giving and taking the whole way. Portfolio volatility off the charts. I learned how not to trade. Check out synthetic puts and calls. Using futures to hedge an options position is very expensive. Whipsaw can kill you . Synthetics if used right eliminates dynamic hedging. I would challenge any model out there to see what happens to your model if you go with some form of static hedging. About 7 years ago went with static hedging. Have never traded unhedged since. When I said worse case scenario is ," you get staying power and make money", I was obviously being fiscious. If I was a market preacher I would preach static hedging, then proper position size as a percentage of the portfolio. Couple these with a model that wins more than it losses, and makes more money when it wins verses it's losers. You are maybe onto something.

 

[stasbz]

if you buy options it is only for momentum market otherwise you lose money.

 

[A Dashing Blade]

Hey traded futures twice for 8-9 months each. Traded every day. Traded the night desk.

Apols Mike, thought you meant you had only made two trades.

. . . Deffinently where the adrenaline gets flowing.

Imo you have to be able to become absolutely emotionless when day trading futures. The other side of the coin to feeling good about wining is that you WILL feel bad about losing. This induces an unstable mental state (think Jimi Hendrix levels of feedback)

Have never traded unhedged since. When I said worse case scenario is ," you get staying power and make money", I was obviously being fiscious. If I was a market preacher I would preach static hedging, then proper position size as a percentage of the portfolio.

Personally don't get this idea of "hedging" a futures position. The need to hedge implies to me that one would be under-margined relative to your (mental) comfort level. Eg, for me, while minimum margin on the Bumnd is (iirc) EUR1250, my personal margin ie the figure I personlly use, is EUR5000

Couple these with a model that wins more than it losses, and makes more money when it wins verses it's losers. You are maybe onto something.

110%. To which I'd add that I personally believe that everyone goes through periods of consecutive lossses and periods of consecutive wins. I'd advocate agreessively scaling down one's trade size as soon as you start to make losing trades.

Just my personal 2p worth.

 

[tar]

if you buy options it is only for momentum market otherwise you lose money.

Same with Futures ...

 

[stasbz]

Same with Futures ...

options (if you buy) expire worthless (you lose money) if price doesnt change, in futures in that case you dont lose.

 

[tar]

options (if you buy) expire worthless (you lose money) if price doesnt change, in futures in that case you dont lose.

Only OTM options will expire worthless , and you will lose the spread and commissions in the Futures if price doesn't change .

 

[Mike boschert]

Right on about being non emotional when trading. I believe most traders would do better if they got rid of themselves. I realized that last blow up. My model is 100 percent mechanical. My trading record for last 7 is an anomaly. Long term positive expectations is where every trader should start when analyzing theirs or any trading model. I believe if the human is involved in trading their chances for success long term are less than the survival rate of a cicada. History is my gauge on this train of thought. New traders fire yourself and design a model that operates on statistics that repeat and are exploitable. These things are out their you got to find them on your own. Nobody will ever sell you a system that works. They would keep it to themselves if it worked. Some people have found a profit center in buying options. Look up Talebs trading model. Buys a otm put and a otm call. Non directional trade. Hedged to desired exposure. Risks small amounts of portfolio per trade. When one of them start making money take the money. Don't trade to get in the money, trade to make a percent. Choose volatile markets S&P for last year could have killed them. The last 2 months would have been profitable . I think Talebs model is best out there for being long only options. If I wasn't a long/short trader I would try Talebs model. If anybody try's this or has input lets hear it.

 

[A Dashing Blade]

Same with Futures ...

Option maturities (often?) go out longer than those for the futures. For the cost of one future's worth of margin you could buy a couple of OTM options.

 

[jcvmw1]

I think that trading futures is way easier than trading options. I know this does not apply to everyone, but I feel that futures, specifically emini sp 500 contracts are incredibly profitable. I basicly scalp all day and pull in about $850 a day. Whats your guys take on this?

this may not answer your question but there is a ton of good information on this website. I have spent many hours on it myself and even given a small donation, if I had more I would give it.

http://trading-naked.com/

But if you do make it over to Traders education website one that Joe Ross operates he is a stiff for futures and I agree with him.