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Electronically traded contracts.
Eminis are electronically traded futures contracts on the Chicago Mercantile Exchange that represent a portion of the larger futures contracts institutional traders use. E-mini contracts are available on a wide range of indices such as the Nasdaq 100, S&P 500, S&P Midcap 400 and Russell 2000. E-mini contracts are 1/5 the size of larger institutional contracts and so are more affordable to retail traders. So for example the very popular E-mini S&P 500 contract works as follows: One point of the E-mini S&P 500 contract is worth $50, so for every open trade held, an one point movement in this E-mini index would result in $50 profit/loss, If 2 contracts are held then the index’s one point movement will cause a $100 profit/loss.
Why trade Eminis.
Volatility: Volatility creates huge opportunity which makes it possible to make significantly more with small account balances.
Affordability: Offers broad market exposure at low cost.
Easier to monitor: You only need to watch few indices as opposed to traditional stock picking where you have to scan through 100’s of stocks and still are exposed to single stock pre-announcement movement risk and accounting fraud risk.
High liquidity: Highly liquid market as opposed to single stocks which often lack transparency and can be manipulated by large brokerage firms.
100% Electronic: Eminis trade virtually round the clock and fill orders really fast as opposed to the old days where you had to ring up your broker, get stock quotes and sometimes had to wait for as long as 30 minutes before you got filled (at a bad price) often wiping out your entire profit, order fill efficiency and speed of the Eminis are unparalleled !
Profit in up AND down markets: E-mini trading can facilitate profitable strategies in both up and down markets as opposed to single stocks that are often vulnerable to short selling restrictions imposed by the SEC (Securities and Exchange Commission).
Tax free profits: Unlike traditional single stock investing, income from futures trading such as the Eminis is 100% yours to keep.
Eminis are particularly suitable for moderator, live mentor training programs.
So do the Eminis offer an effortless, guaranteed source of income? Definitely not!
Anyone who claims they can teach you how to trade markets, currencies or the Eminis and over promise they are actually lying. However there are good trading mentors out there such as Mark Douglas and Van Tharp who have educated many good traders on Stocks and commodities for long term investing, and mentors like Afshin Taghechian who have spent their entire life researching markets. Afshin Taghechian’s material is focused on short term trading and applies to all markets. He invented the ‘TIMES’ trading system which is focused on Eminis and high volatility trading objectives. So why do you think Mr. Afshin Taghechian chose the Eminis out of all those markets to use in his live trading mentoring service? It’s because they know all these advantages of these relatively new contracts – The Eminis! Comparing the Eminis to other markets or single stocks is like comparing a modern driving instructor’s car to that of the 60’s, one that has no power steering, no ABS and young people are required to learn to drive and park and take risks in that car… why not just use the best option available?
Paul Murphy is a passionate and successful trader. Always in search of the best trading systems, and researching ways to help you be the best trader you can possibly be. Discover how to improve your trading performance with articles and interviews at his blog: www dot trading powerhouse dot com