I wouldn’t even begin to trade without an Emini trading education, it was the only thing that saved me from losing all my savings in the market. But getting an education can often be the difficult part! Here’s what I did and what I learned.
Even though I was not brand new to the world of share market trading, (I had invested in shares and traded in CFD’s) Eminis were new to me but I had been attracted to them because of the potential to grab large sums of money out of the market using them. (Isn’t that why we’re all attracted to them?)
As you may already know, Eminis are a highly leveraged product. They are like a mini version of a futures contract such as the S&P500 or NASDAQ100, but because they are a mini version they don’t cost as much as the underlying index. So instead of it costing you hundreds of thousands of dollars to trade the S&P500 (and take advantage of the great volume and volatility of this index) you can trade the S&P500 Emini contract with a capital investment of as little as $1,000.
Because this product is so volatile and highly leveraged it really appeals to the small investor, they can take advantage of the movements in the market and make large profits very quickly. The problem is… that very same volatility and leverage are what can cause uneducated traders to lose their account very quickly.
This is the reason why it’s imperative you get an education about Eminis and how to trade them. Learn how the market works, develop skills for getting into a trade and GETTING OUT at the appropriate time. Work on your money management skills so you are only putting into the market what you can afford to lose, and know what your profit target and stop losses are before entering into a position.