Trading Forex vs Futures
I'm looking for something to learn about and trade. I have around $2500 to put into it at the start, once I've spent 6 months learning and trading a practice account.
Which would be better, forex or futures? It may sound like a stupid question, but which is more predictable (i.e. the least irrational) in your opinion? Also which would be better for a $2500 start?
if you had to pick just from those two, i would pick forex. the problem with investing in futures with such a low capital base is that your margin minimum will most likely be half of your capital base, so therefore you could only trade 1-2 different products. In addition, futures are highly leveraged so the smallest tick could lose a large percentage of your account. For example, s and p 500 minis smallest movement is 25 basis points and that would lose or make $12.50.
Go here and go through the school...then you'll figure out whether you can stand FX or not
http://www.babypips.com/
[quote=SirBarney]Go here and go through the school...then you'll figure out whether you can stand FX or not
http://www.babypips.com/[/quote]
Yeah, I've been looking at it the past few days, seems like an excellent resource for fx. Do you trade? I've was never into technicals that much when trading stocks.. would fundamental analysis only be used when looking at a long term fx strategy?
And do you have something against technicals? Or have you just never used them before so you have no idea how to use them? Fundamental analysis in FX is usually mid/long-term because of how it's structured but I like FX because it's basically trading based off different country's economies. How short-term are you looking for?
Admittedly I'm quite ignorant to its exact methods (will check them out on babypips), but I always thought of it as hocus pocus when I saw these guys on tv drawing dozens of lines in every direction over the candlesticks like they had a clue. In terms of duration, I would be looking to stay up to 2 weeks in a given trade if needs be.. I guess that's still too short for fundamentals.
I agree with you on how interesting it is; economics has come to the front of everyone's heads lately so there is no shortage of data to look at either. This may sound stupid, but when looking at it in the long term (e.g. 6 months/1 year) what's going to happen seems almost too obvious in some ways (e.g. EUR/USD this year - no one was even disputing that this would happen)?
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