Anyone trade the mini-dow? | Forex Factory

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Anyone trade the mini-dow?

  • #1
  • First Post: Sep 2, 2006 4:37pm Sep 2, 2006 4:37pm
I've searched on the forum but there's no info that I could see. If there is a thread point me to it, please.
I was reading about the difference between the S&P and the mini dow, and wondered if the dow shown in the SBFX version of MT4 is the mini or the main index.
I read on Trade the Markets website that the mini dow is a better play than the S&P, any thoughts?
I was going to paper trade this when FX is ranging to gain some insight, so could do with any feedback you guys may give me.
Peter
  • #2
  • Sep 3, 2006 1:37am Sep 3, 2006 1:37am
Quoting PeterFM
I've searched on the forum but there's no info that I could see. If there is a thread point me to it, please.
I was reading about the difference between the S&P and the mini dow, and wondered if the dow shown in the SBFX version of MT4 is the mini or the main index.
I read on Trade the Markets website that the mini dow is a better play than the S&P, any thoughts?
I was going to paper trade this when FX is ranging to gain some insight, so could do with any feedback you guys may give me.
Peter
Ask Jim. He is a pro at trading the mini dow.
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  • #3
  • Sep 3, 2006 2:47am Sep 3, 2006 2:47am
Quoting diallist
Ask Jim. He is a pro at trading the mini dow.
Hi Dial
I was aware of Jim's trading in that arena, but as he's so busy thought I'd see if any-one else had some insights.
I'm reading up on Investopedia and the CBOT site, but having 'googled' and seen all the usual snake oil salesmen, decided that FF might be the place to cut through the fog.
If I get no feedback here, I'll maybe ask Jim.
Not looking for any strategies etc, just what the core differences are in risk exposure, minimum A/C sizes, etc.
Peter
  • #4
  • Sep 5, 2006 8:30am Sep 5, 2006 8:30am
Quoting PeterFM
I've searched on the forum but there's no info that I could see. If there is a thread point me to it, please.
I was reading about the difference between the S&P and the mini dow, and wondered if the dow shown in the SBFX version of MT4 is the mini or the main index.
I read on Trade the Markets website that the mini dow is a better play than the S&P, any thoughts?
I was going to paper trade this when FX is ranging to gain some insight, so could do with any feedback you guys may give me.
Peter
HELLO PETER, the main difference between the mini sp and dow is the point increments. a point/tick in the mini dow is 5 dollars for one contract. the mini sp is much higher at 12.50 per tick. this allows you much more flexibility not only entering a trade but gives you more places to exit. the margins for both are the same. daytrading margins are as low as 500 per contract or lower. minimum account sizes can be in the 2000 range. i honestly dont know why anyone would trade the sp over the mini dow but plenty of people do. its kind of like why would someone with a 2000 account in forex trade mini lots instead of micro. the money management angle based on fijitraders research clearly shows a minimum account size of 25,000 to 30,000 before going to mini lots. its a learning process i guess. most all demo accounts can be extended peter if you ask. at least thats my experience.
  • #5
  • Sep 5, 2006 9:20am Sep 5, 2006 9:20am
Cheers Jim
Quote
HELLO PETER, the main difference between the mini sp and dow is the point increments. a point/tick in the mini dow is 5 dollars for one contract. the mini sp is much higher at 12.50 per tick. this allows you much more flexibility not only entering a trade but gives you more places to exit.
I'd read this on Trade the Markets, and, without any fuller knowledge, it seemed logical the way it was put there.
Quote
the margins for both are the same. daytrading margins are as low as 500 per contract or lower. minimum account sizes can be in the 2000 range.
OK this is the part I'm not sure of and can't seem to find an answer that makes it obvious to me. So, I have an account (theoretically!!) funded with $2000, but the day-trading margin is $500 per contract, as I read that it means if I make 1 trade my risk is 25% of my account?
I suspect that I'm trying to transfer FX thinking to Futures trading but I'm missing a point here aren't I?
The other thing that's not clear is this, is the mini-dow traded spot (as per FX) or are things like option terminology to be taken into account ie strike price - in the money etc?
Quote
most all demo accounts can be extended peter if you ask. at least thats my experience.
Fine, I'm going to try Lions Futures/Direct Trade and see how it pans out. No rush for the answers, I'll keep researching on the CBOT site, but may come back for more insights.
Peter
  • #6
  • Sep 5, 2006 9:51am Sep 5, 2006 9:51am
if you have an account with 2000 and margin at 500 per contract it simply means that they will allow you to trade up to 4 contracts, which you should not. it has nothing to do with risk level. example.

2000 account.
you decide to trade 4 contracts per trade.
5x4=20
your trade will move in 20 dollar increments per tick.
if you use 5 percent max risk per trade it would look like this.
2000x5% = 100 dollars. at 20 dollars per tick thats a 5 tick stop.
obviously you dont want to do that.
a better aproach would be trade 1 contract.
2000x5% = 100
5x1=5 dollars per tick
100 / 5 = a 20 tick stop, much more reasonable.
the bottom line is its best to start with at least 5000 and use risk levels around 2 or 3 percent.
5000 x 3% = 150
a risk level of 150 dollars or more will give you room to actually trade without ultra small stops. a common daytrading stop in this market would range from 15 to 25 ticks. a position trade stop would of course be higher.

Quoting PeterFM
Cheers JimI'd read this on Trade the Markets, and, without any fuller knowledge, it seemed logical the way it was put there.
OK this is the part I'm not sure of and can't seem to find an answer that makes it obvious to me. So, I have an account (theoretically!!) funded with $2000, but the day-trading margin is $500 per contract, as I read that it means if I make 1 trade my risk is 25% of my account?
I suspect that I'm trying to transfer FX thinking to Futures trading but I'm missing a point here aren't I?
The other thing that's not clear is this, is the mini-dow traded spot (as per FX) or are things like option terminology to be taken into account ie strike price - in the money etc?
Fine, I'm going to try Lions Futures/Direct Trade and see how it pans out. No rush for the answers, I'll keep researching on the CBOT site, but may come back for more insights.
Peter
  • #7
  • Sep 5, 2006 10:08am Sep 5, 2006 10:08am
Quoting james16
if you have an account with 2000 and margin at 500 per contract it simply means that they will allow you to trade up to 4 contracts, which you should not. it has nothing to do with risk level. example.

2000 account.
you decide to trade 4 contracts per trade.
5x4=20
your trade will move in 20 dollar increments per tick.
if you use 5 percent max risk per trade it would look like this.
2000x5% = 100 dollars. at 20 dollars per tick thats a 5 tick stop.
obviously you dont want to do that.
a better aproach would be trade 1 contract.
2000x5% = 100
5x1=5 dollars per tick
100 / 5 = a 20 tick stop, much more reasonable.
the bottom line is its best to start with at least 5000 and use risk levels around 2 or 3 percent.
5000 x 3% = 150
a risk level of 150 dollars or more will give you room to actually trade without ultra small stops. a common daytrading stop in this market would range from 15 to 25 ticks. a position trade stop would of course be higher.
That's clearer, but I can't risk that sort of money yet so I'll leave it for now. Don't want to be sweating on my 1st trade do I?
Thanks
Peter
  • #8
  • Sep 21, 2006 2:26pm Sep 21, 2006 2:26pm
Jim, thanks for your wisdom here. I have also gone with Lions Futures for futures/commodities trading.
  • #9
  • Sep 21, 2006 3:18pm Sep 21, 2006 3:18pm
thats great b, they are good guys over there.
Quoting baddison
Jim, thanks for your wisdom here. I have also gone with Lions Futures for futures/commodities trading.
  • #10
  • Sep 21, 2006 4:39pm Sep 21, 2006 4:39pm
I tried that for a few weeks, but every so often the electronics would go down, and there is not a darn thing you can do about it until it gets working again, meanwhile your open trade is at the mercy of the gods until the electronics start working....4-5 times of that happening to me and I said sayonora....I don't see how anyone can trade any Mini's with any confidence!
I'm only a bird in a gilded cage
  • #11
  • Sep 21, 2006 9:18pm Sep 21, 2006 9:18pm
Quoting minnesota-goose
I tried that for a few weeks, but every so often the electronics would go down, and there is not a darn thing you can do about it until it gets working again, meanwhile your open trade is at the mercy of the gods until the electronics start working....4-5 times of that happening to me and I said sayonora....I don't see how anyone can trade any Mini's with any confidence!
Maybe you had a really bad broker with really poor data feed???
  • #12
  • Sep 21, 2006 9:53pm Sep 21, 2006 9:53pm
YM bounces around a lot more than ES, not for timid with tight stops. I feel the ES is more perdictable and easier to trade.
Smile... Darwin loves you.
  • #13
  • Last Post: Sep 21, 2006 10:14pm Sep 21, 2006 10:14pm
i guess everyone has an opinion. i know some people swear by the es and even others are smitten with the er. still others like the mini nasdaq. i have traded them all for years. feeds or internet connection going down has never been a big problem for me but you never know so i keep a wireless laptop at all times. i also keep my brokers phone number handy. as far as the mini dow i dont think its even debatable anymore that it beats the pants off of es. put a 5 minute chart of the ym right next to one of the es and its almost exactly the same. having the ability to to get in and out in 5 dollar increments instead of 12.50 or 25 is by itself enough of a reason to trade it over the others. volume for the mini dow now regularly surpasses the es so getting in and out never takes more than 5 to 10 seconds max and usually in 2 or 3 or less.
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