Which Futures Contract Is Most Effective to Trade?
From the beginning, I have got to state that there are no e-mini contracts that are “easy” to trade. Some contracts have esoteric advantages and disadvantages that make them attractive to each own and individual e-mini trader. Some contracts are especially complicated for new traders, in particular the ES contract.
S&P Mini Futures (ES)
The ES contract is the largest traded futures contract on the Chicago Mercantile exchange and is populated by qualified traders, automated trading, and versed individual traders. These factors can combine to make the ES (S & P e-mini) contract unpredictable and full of retracements, surprise moves in the opposite direction, and general erratic behavior. I adamantly advise new traders to prevent the ES contract until they have garnered a good deal of encounter trading in chaotic market conditions.
Dow Mini Futures (YM)
On the other hand, the YM (Dow E-mini) contract can be a bit more mundane and the dollar amount per tick is only five dollars. This makes the YM contract a especially attractive contract for new traders to hone their e-mini trading skills and not blow up their accounts. We as well feel the YM contract trends more reliably than the ES contract, which makes it a bit easier to trade. We ought to as well point out that as a long-time investors we personally trade the YM contract instead of the ES contract. Why? Fairly simply, it’s easier for many to trade and most traders are comfortable with the price movement. Is the YM contract for anybody? No, we suppose there are other contracts that are attractive to e-mini traders.
Starting at 6 AM CST we can trade the 6E (Euro) contract. This certain contract can be trickier than the YM, but as well tends to produce some extremely impressive trending patterns. The most active movement in the contract begins at approximately 3 AM CST and ends at 10:30 AM CST, so you must be an early riser to take advantage of the benefits this certain contract proposes. It is in particular active at the open of European trading and then again at the open of US trading. We can start trading at 6 AM CST and in general find a number of excellent trades until switching over to the YM at 8:30 AM CST. This certain contract takes a bit of adjustment and I greatly recommend a bit of simulated trading before really tackling the contract with live money as it moves in just a bit diverse patterns than the typical US index futures contract.In summary, we have recommended avoiding the ES contract unless you have a high level of proficiency in that certain contract and instead focus on contracts that propose better opportunities for profitability. We like to alert you that a myriad of e-mini traders are greatly proficient on the ES contract, but for new traders we feel strongly that the YM and 6E propose better chances for success. As a footnote, the NQ (NASDAQ e-mini) and a number of other contracts propose new traders excellent opportunities; weI just happen to prefer the YM and the 6E for my personal trading and as vehicles to exercise new traders.