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Newbie to Futures: Margin relative to account size

  #13 (permalink)

Burlington, Vermont
Trading Experience: Beginner
Platform: StockTwits
Broker/Data: Robinhood
Favorite Futures: ES, GC, ZB
nathanologist's Avatar
Posts: 706 since Jun 2015
Thanks: 877 given, 776 received

@sienna I use NT7 and NT Brokerage FCM is Phillips. From my experimentation with a minimum funded account ($1000) you could technically trade 2 contracts... but if it went against you 1 tick I understand you'd be in violation. I was told their risk management team would liquidate your position.

To watch the market and learn to use thier system I used the following strategy: fund a $1k NT Brokerage account and get only ES/NQ/6E data ($5/month). To avoid inactivity fee ($25) and get a toe wet make a single trade per month using a 1 tick stop loss. Worst case scenario you lose $16.74 on the trade and your data plus losses is less than the inactivity fee. With discipline (a skill much needed to successfully trade) you could watch the market perpetually for limited cost and quite possibly a small gain. I used this strategy to watch the market and become very familiar with NT for many months before fully funding my account.

As far as risk management goes most will say 2% of your total account value in risk, so I understand that to be $25k account trading 1 contract with a $500 loss limit per trade. I also know for a fact that others trade $5000 balance per contract so that means $25k account trading up to 5 contracts. I personally funded with $30k and limit myself to 2 contracts only with a $500 catastrophe stop on most trades. This is because I'm too inexperienced to take more risk than that.

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