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Trading the global futures markets is similar from a chart point of view as buying and selling the stock market.  The main difference is the futures markets are naturally leveraged (little amount of money controls a relatively substantial investment).  Even if you use margin on stocks, traders will not approach the leverage of the futures markets.  This is what tends to make the futures markets appealing as a day trading vehicle, or as a swing trading vehicle.  Seldom do people hold futures investments for the long term – at most the trade might be a handful of months.

If all you desire to do is day trading, then the futures markets really should be on your list to trade.  If you have the SEC required $25,000 minimum to day trade the stock market, then you can very easily day trade some futures as well by opening a futures account.   There is usually a bit more volatility in the futures markets than in the stock market, and this can offer some great possibilities.  Most futures brokers will mandate that you  deposit about $5000.00 initially to open an account, some might be higher.  Intraday margins to trade a contract or two are generally much less than the overnight margin requirements.  This is because overnight there can be large gaps in price brought on by news events and an individual is  required to maintain enough capital in your account to cope with that level of volatility.  Furthermore, it is possible if you carry futures positions overnight (or even intra-day if you don’t utilize stops) to have your futures account go into a debit balance because of the leverage.  Almost all futures brokers will in no way let this happen and will close out all your positions prior to this happening.  This type of event is plausible and the risks should be understood.  Intraday it is uncommon, but overnight it can happen with greater frequency.

While these dangers should not be ignored, they should not keep you from thinking about trading futures either if you are a day trader.  From a technical point of view, futures trading is much the same to day trading the stock market, with the exclusion that there are no “news events” on the futures such as analyst upgrades or downgrades to concern yourself with.  Economic events and news happen daily, and these affect both index futures and stocks who trade off the futures, so this is nothing new.  There are many places now where you can get a cost-free demo account to practice day trading the futures markets.  If you find that you benefit from doing it, consider adding the futures markets to your current trading.

The futures work very well for trying out a day trading robot, simply because greater volatility.  The futures markets are often a better choice for any type of automated trading because they tend to be more range bound than stocks.  While a stock can run from 10 to 200 in a few months, the futures markets do not have this big a run, although they do trend up and down over months of time.

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