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Questions about trading S&P 500 emini futures.
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Questions about trading S&P 500 emini futures.

  #1 (permalink)
Trading Apprentice
New York, New York
 
Futures Experience: Beginner
Platform: NinjaTrader
Favorite Futures: ES
 
Posts: 11 since Nov 2015
Thanks: 8 given, 2 received

Questions about trading S&P 500 emini futures.

Hi, If I have 6k in an account that allows me to trade the emini sp500 futures would I be able to scalp a few ticks then jump back into another position or would I need to wait a certain amount of time to be able to buy and sell multiple times a day? I know you need around 25k to be a PDT but is that the same for the futures market? I'm only looking at doing 1 or 2 contracts so I don't loose ALL my money. How many times a day can I buy then sell an emini contract? And can I do this amount everyday? What other restrictions/obstacles would I face with only 6k besides being margin called? Thanks!

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  #2 (permalink)
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  #3 (permalink)
Market Wizard
Germany
 
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KevinMas View Post
Hi, If I have 6k in an account that allows me to trade the emini sp500 futures would I be able to scalp a few ticks then jump back into another position or would I need to wait a certain amount of time to be able to buy and sell multiple times a day? I know you need around 25k to be a PDT but is that the same for the futures market? I'm only looking at doing 1 or 2 contracts so I don't loose ALL my money. How many times a day can I buy then sell an emini contract? And can I do this amount everyday? What other restrictions/obstacles would I face with only 6k besides being margin called? Thanks!

The PDT rule isn't for futures, so that's not the problem.
The problem is your undercapitalization. Trading the ES with a 6k account is simply nuts.

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  #4 (permalink)
Trading Apprentice
Cincinnati, OH/USA
 
Futures Experience: Intermediate
Platform: NinjaTrader
Favorite Futures: ES
 
Posts: 4 since Jan 2016
Thanks: 0 given, 5 received

As Choke said, the PDT rules doesn't apply here. Personally, I think the broader problem may be your lack of understanding of how it really works. The first thing will be the Intraday Margin your broker requires to trade the ES. Example: With 6k in your trading account, theoretically you could trade 12 contracts at once if your brokerage required a $500 Intraday.....meaning you wouldn't be subject to a Margin Call unless you tried to hold the position overnight.

Now, "do not" take me to mean or imply that you should. The question was "how many are possible". The next thing is you could theoretically get in and get out of positions all day long until your margin dropped below your brokers requirement thus depleting your 6k.

Also, and I'm not being critical here, but since you're asking these questions, is it safe to assume that you've zero experience in trading whether paper trading or live trading? If you've been paper trading, the platform you downloaded and the brokerage that supports it will have all the answers to your margin questions within their site. If you've not paper traded and sufficiently found a paper trading model that works for you, I suggest you start there else you'll likely kiss that 6k goodbye pretty quick.

Just my two cents. Best of luck.

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  #5 (permalink)
Trading Apprentice
New York, New York
 
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Favorite Futures: ES
 
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choke35 View Post
The PDT rule isn't for futures, so that's not the problem.
The problem is your undercapitalization. Trading the ES with a 6k account is simply nuts.

I understand why it sounds nuts but if I have good stops in play and only trading 1 contract it could work no? I'm doing this it get rich quick haha, I just want some experience in the real futures market. Can you elaborate more on why its "simply nuts"?

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  #6 (permalink)
Trading Apprentice
New York, New York
 
Futures Experience: Beginner
Platform: NinjaTrader
Favorite Futures: ES
 
Posts: 11 since Nov 2015
Thanks: 8 given, 2 received


OldBullShipper View Post
As Choke said, the PDT rules doesn't apply here. Personally, I think the broader problem may be your lack of understanding of how it really works. The first thing will be the Intraday Margin your broker requires to trade the ES. Example: With 6k in your trading account, theoretically you could trade 12 contracts at once if your brokerage required a $500 Intraday.....meaning you wouldn't be subject to a Margin Call unless you tried to hold the position overnight.

Now, "do not" take me to mean or imply that you should. The question was "how many are possible". The next thing is you could theoretically get in and get out of positions all day long until your margin dropped below your brokers requirement thus depleting your 6k.

Also, and I'm not being critical here, but since you're asking these questions, is it safe to assume that you've zero experience in trading whether paper trading or live trading? If you've been paper trading, the platform you downloaded and the brokerage that supports it will have all the answers to your margin questions within their site. If you've not paper traded and sufficiently found a paper trading model that works for you, I suggest you start there else you'll likely kiss that 6k goodbye pretty quick.

Just my two cents. Best of luck.

Thank you for the very informational response. Much appreciated. I have actually been trading for over a year and paper trading for about the same time so I have some knowledge but I recently got into the futures market and I'm just trying to figure out some things I'm confused about. So I looked up the brokerage I plan on using. (GoFutures) and this is what I found about margin requirements for trading the emini s&p 500
Initial Margin - 5060 Maintenance Margin - 4600 What exactly does this mean if I plan on starting with 6k? Thanks!

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  #7 (permalink)
Trading Apprentice
Cincinnati, OH/USA
 
Futures Experience: Intermediate
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Posts: 4 since Jan 2016
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KevinMas View Post
Thank you for the very informational response. Much appreciated. I have actually been trading for over a year and paper trading for about the same time so I have some knowledge but I recently got into the futures market and I'm just trying to figure out some things I'm confused about. So I looked up the brokerage I plan on using. (GoFutures) and this is what I found about margin requirements for trading the emini s&p 500
Initial Margin - 5060 Maintenance Margin - 4600 What exactly does this mean if I plan on starting with 6k? Thanks!

The Initial Margin is the amount required to be in the account prior to opening a position. In this case, 5060. The Maintenance Margin, 4600, is the point where you will get a margin call if the position drops to this level while you're still holding it. These two numbers are only relevant to positions you hold longer than 24 hours....thus, not Intraday Trading.

I don't know anything about GoFutures. I don't use them. If you plan to use NinjaTrader(as listed on your profile), you can easily set up and use either Phillip Capital or Dorman Trading in a fully integrated manner. The Intraday Margin is $500 per contract.

So, the long answer to your question is this: The Initial and Maintenance Margins mean nothing unless you plan to hold more than 24 hours which I would never recommend. The Intraday is 500 per contract and you could get into and out of 1 or 2 positions multiple times per day.

You've been paper trading other things for over a year and just started to look at futures? What were you paper trading before? I'd recommend you spend some time testing(paper trading) your Futures trading methodology for several weeks before throwing live money at it. NinjaTrader can easily show you the results over a specified period of time. Wins, losses, draw down, everything.

I'm really not trying to rain on your parade. Just a suggestion. I hate to see anyone get cleaned out before they get good at it. It's a different game.

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  #8 (permalink)
Trading Apprentice
New York, New York
 
Futures Experience: Beginner
Platform: NinjaTrader
Favorite Futures: ES
 
Posts: 11 since Nov 2015
Thanks: 8 given, 2 received


OldBullShipper View Post
The Initial Margin is the amount required to be in the account prior to opening a position. In this case, 5060. The Maintenance Margin, 4600, is the point where you will get a margin call if the position drops to this level while you're still holding it. These two numbers are only relevant to positions you hold longer than 24 hours....thus, not Intraday Trading.

I don't know anything about GoFutures. I don't use them. If you plan to use NinjaTrader(as listed on your profile), you can easily set up and use either Phillip Capital or Dorman Trading in a fully integrated manner. The Intraday Margin is $500 per contract.

So, the long answer to your question is this: The Initial and Maintenance Margins mean nothing unless you plan to hold more than 24 hours which I would never recommend. The Intraday is 500 per contract and you could get into and out of 1 or 2 positions multiple times per day.

You've been paper trading other things for over a year and just started to look at futures? What were you paper trading before? I'd recommend you spend some time testing(paper trading) your Futures trading methodology for several weeks before throwing live money at it. NinjaTrader can easily show you the results over a specified period of time. Wins, losses, draw down, everything.

I'm really not trying to rain on your parade. Just a suggestion. I hate to see anyone get cleaned out before they get good at it. It's a different game.

Thanks again for another elaborate answer! You're very helpful! I was just trading the stocks within the S&P500 for that time. And I remember learning about futures a while back but It was way over my head, still may be haha, but I feel like I'm ready to keep on learning but the best way to learn is to trade with real money. And yes I'm aware its also the best way to lose all your money. But like I said before I'd only be doing 1 contract at a time and the Intraday margin for GoFutures is $500 as well with $1 commission both ways. Also if I plan on shorting are there any restrictions/fees?

Also when you started trading did you develop a solid thorough plan like where you'll enter and exit before the market opens or just watch and have a general plan but play it by ear, so to speak. Thanks again man, you're awesome.

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  #9 (permalink)
Trading Apprentice
Cincinnati, OH/USA
 
Futures Experience: Intermediate
Platform: NinjaTrader
Favorite Futures: ES
 
Posts: 4 since Jan 2016
Thanks: 0 given, 5 received


KevinMas View Post
I feel like I'm ready to keep on learning but the best way to learn is to trade with real money. And yes I'm aware its also the best way to lose all your money. But like I said before I'd only be doing 1 contract at a time and the Intraday margin for GoFutures is $500 as well with $1 commission both ways. Also if I plan on shorting are there any restrictions/fees?

Also when you started trading did you develop a solid thorough plan like where you'll enter and exit before the market opens or just watch and have a general plan but play it by ear, so to speak. Thanks again man, you're awesome.


Funding through one of the Ninjatrader houses could save you a bit in commissions depending on whether you lease the software quarterly or buy a lifetime license. Round trip commission per trade plus exchange fees for me is 3.90 per contract. Going short is the same as going long. No difference in restrictions or fees. Correctly executed, one can make as much or more going short as long. It's truly about price action, support/resistance levels, etc. I'd highly recommend learning about price action and identifying S/R levels. Only about 20% of days are "trending" days(meaning mostly one way or the other. Today for example, has been what I call a mostly sideways day with only minor overall direction one way or the other.

While there is always an inherent risk, no. I don't play it by ear. Educationally, my background is in Financial Investment. No, that doesn't make me any better or worse than anyone else, but it did give me insight into what "might" make things move one way or the other. As for a plan: Before I started my adventures here, I read, watched, studied, asked questions, and practice, practice, practiced and then practiced some more. I've been fortunate not to completely flush out my account and it works for me. But, I developed my trading plan, with the insights from lots of folks, and based on my own trading style and preferences. You'll do the same over time. You'll figure out what works for you and what doesn't. There is no magic bullet or "Holy Grail" as some people will try to sell you. There are some great insights, but nothing is perfect. If there was truly a 100% successful Holy Grail, everyone would have it by now.

As for a plan for a specific entry or exit, as a Professor of mine use to say: "It depends on the day." Everyday is different. But, don't just take my word for it. Look at today's chart then look at a random day from December. The volatility difference alone with demonstrate.

Best of luck. If I can help more, just ask. I'm not perfect, but I'll help if I can. As will many others around here. Clay

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  #10 (permalink)
Trading Apprentice
New York, New York
 
Futures Experience: Beginner
Platform: NinjaTrader
Favorite Futures: ES
 
Posts: 11 since Nov 2015
Thanks: 8 given, 2 received



OldBullShipper View Post
Funding through one of the Ninjatrader houses could save you a bit in commissions depending on whether you lease the software quarterly or buy a lifetime license. Round trip commission per trade plus exchange fees for me is 3.90 per contract. Going short is the same as going long. No difference in restrictions or fees. Correctly executed, one can make as much or more going short as long. It's truly about price action, support/resistance levels, etc. I'd highly recommend learning about price action and identifying S/R levels. Only about 20% of days are "trending" days(meaning mostly one way or the other. Today for example, has been what I call a mostly sideways day with only minor overall direction one way or the other.

While there is always an inherent risk, no. I don't play it by ear. Educationally, my background is in Financial Investment. No, that doesn't make me any better or worse than anyone else, but it did give me insight into what "might" make things move one way or the other. As for a plan: Before I started my adventures here, I read, watched, studied, asked questions, and practice, practice, practiced and then practiced some more. I've been fortunate not to completely flush out my account and it works for me. But, I developed my trading plan, with the insights from lots of folks, and based on my own trading style and preferences. You'll do the same over time. You'll figure out what works for you and what doesn't. There is no magic bullet or "Holy Grail" as some people will try to sell you. There are some great insights, but nothing is perfect. If there was truly a 100% successful Holy Grail, everyone would have it by now.

As for a plan for a specific entry or exit, as a Professor of mine use to say: "It depends on the day." Everyday is different. But, don't just take my word for it. Look at today's chart then look at a random day from December. The volatility difference alone with demonstrate.

Best of luck. If I can help more, just ask. I'm not perfect, but I'll help if I can. As will many others around here. Clay

Thanks Clay, you're very helpful and I'm grateful for people like you on these forums! I just found out that Firetip pro is actually $49 a month. Now I'm not sure if thats cheap or expensive but to me dishing out $49 of your profits seems alot especially if I'm learning. What do you use now/what would you recommend for me to use in my position? I have checked out NinjaTraders fees margin etc, but I haven't checked out the actual platform they have for trading, I will soon. Do you know if NinjaTrader has a some kind of fee for the software?
Thanks again, Kevin

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