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Dear Traders,
(Day) Trading Futures vs. ETFs, Stocks
By: John D Thorpe, Cannon Trading Senior Commodities Broker
According to the Wall Street Journal, assets in Exchange Traded Funds (ETFs) have grown to roughly $2 trillion dollars since their inception. Exchange Traded Funds were created to compete with the $20 trillion dollar Mutual Fund Market as it was the only market in which you could achieve broad class diversity outside of individual stocks. ETFs were also designed to overcome the drawback that mutual funds could only settle on the close of daily business at their Net Asset Value (NAV). Previously, broad diversification across market sectors could only be purchased or sold at the close of the business day based on the equity, bond or raw material elements included in the weighted averages of every component of the sector mutual fund—thus, ETFs came into play.
The first Exchange Traded Fund, the Spider or SPDR, was the S&P 500 depository receipt which was designed to track the S&P 500 stock market Index and began trading in January of 1993. No longer could an investor achieve broad market exposure on just the close of the business day, but could now buy and sell the broad market at any time throughout the trading day. Market makers and specialists provided liquidity for ETFs and continue to do so today.
During the May 2010 so called “Flash Crash”, the NYSE cancelled all trades …..
Good Trading
Trading Futures, Options on Futures, and retail off-exchange foreign currency transactions involves substantial risk of loss and is not suitable for all investors. You should carefully consider whether trading is suitable for you in light of your circumstances, knowledge, and financial resources. You may lose all or more of your initial investment. Opinions, market data, and recommendations are subject to change at any time.
Futures Trading Levels
11-12-2019
Economic Reports, source:
bettertrader.co
This is not a solicitation of any order to buy or sell, but a current market view provided by Cannon Trading Inc. Any statement of facts here in contained are derived from sources believed to be reliable, but are not guaranteed as to accuracy, nor they purport to be complete. No responsibility is assumed with respect to any such statement or with respect to any expression of opinion herein contained. Readers are urged to exercise their own judgement in trading.
Posted in: Future Trading News
