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Was asking out of curiosity not necessity. Cause I can see these being pushed like forex "trade today for $50 dollars down " but it will be added liquidity oh well.
Hmmm...we may have NADEX to thank for this rather sudden new CME micro product launch. In January, NADEX added weekly expiring "touch bracket" products for the stock indexes. These were designed to mimic the futures pricing within a bracketed price range. I have been following them and they seem to be trading with a decent spread/liquidity. Guess CME decided there was some business there.
The new CME micros may prove to be popular. Aside from aspiring futures traders, these contracts are small enough to appeal to the retail investing crowd. Why mess with the long/short etfs when you can trade these instead and get:
- 24/5 market access
- No PTD rules
- Avoid those pesky wash sale calculations
- Take advantage of the 60/40 capital gains rate
Expect the big brokerage houses like Schwab and TDA will begin to market these to their customers in the coming months.
The forthcoming new Small Exchange might be another reason. Tastyworks is offering to pay the $100 fee for new accounts ( I took advantage of it). I am not sure how this will compare to NADEX or the Micros but glad to see more possibilities for small trader:
Very interesting, and great to see more options becoming available to prospective futures traders. I trade M6E... as someone who started out a couple years ago knowing absolutely nothing, and having blown three live accounts, I'm pretty pleased to say I've only burnt about $6K in the process of learning a metric shit tonne
That does not include FIO elite membership, which has been invaluable of course
I think I have a slightly different perspective...
As a trader of CFDs, I view the wider spread, slippage, commissions etc. as an asset, not a liability.
My plan is to "graduate" to regular E-minis, which are more efficient, but have larger size. When I get there and my monkey brain starts pinging due to the larger size, I can always tell myself I was able to obtain a positive expectancy with instruments which were harder to get that with.
Maybe I'm nuts, but we'll see. Mean time, wining and losing dinner and a movie is a lot less stressful than betting the farm, and I can dial in my risk finely. If I want to trade 37/100ths of a contract, I can.
I think you are right. This new exchange seems to have lots of notable backers. Website is pretty vague on the details though. Found some additional info on CQG.
According to the press release, Small Exchange will initially offer "five cash-settled contracts based on proprietary indices in equities, interest rates, metals, energy, and foreign exchange." The FX offering sounds like a new Dollar Index. That will be cool. Not sure what proprietary indexes in metals and energy would look like. Guess they will be a blend of the individual commodities in the sector, like they do with the DB commodity indexes. Interesting idea but will Futures traders be interested? The Bloomberg Commodity Index on CME has never gained much of a following. Personally, I'd rather just trade the individual commodities.