Dow Futures Shocking Secret
If you have ever traded stocks, you must have heard a lot about the DOW index going up or down. Recently the DOW index crumbled and lost 1000 points in just a matter of 24 hours. This was most probably one of the biggest loss of the DOW index. Dow futures are futures contracts based on the DOW index or what is actually the Dow Jones Industrial Average Index abbreviated as DJIA. Dow Jones Index was started at the end of the 19 century and is a price weighted index of 30 blue chip stocks that get traded on the New York Stock Exchange. Over the years, there has been changes in the composition of these 30 blue chip stocks but the DOW index has maintained its popularity as the barometer of the New York Stock Exchange. If you happen to watch CNBC, Bloomberg or FOX Business, you will hear a lot about DOW going up or down. The best way to trade the DOW index is through trading the DOW Futures . Know a shocking DOW Futures secret discovered by Karl Dittmann that is repeated daily at the same time that can make you rich. Trade S&P futures! Discover Forex Mastery 2.0 and watch these shocking M3 Forex Software videos that show how it predicted the DOW crumble days before it actually happened.
Now futures trading is somewhat different than the stock trading. In stock trading, you buy and hold the stocks for a certain period of time in order to realize capital gain. But in futures trading, the futures contract is daily marked to the market. Futures trading is done only for speculation or hedging purposes. Hedgers want to hedge their risk by taking positions in futures contracts while the speculators are looking for making quick capital gains. In futures trading, you can use leverage upto 1:10 as compared to 1:2 in stock trading. This makes futures trading risky as compared to stock trading. But many day traders love to trade stock index futures like the DOW futures everyday. The value of the DOW futures contract is ten times the dollar value of the DOW index at any point of time .
Let’s make this clear with an example. Suppose the DOW is at 11,000 points. The value of the DOW futures contract will be $10 multiplied with 11,000 or $110,000. Since the index value is being multiplied with ten, a DOW Futures contract has an inbuild leverage of ten. What this means is that for every point rise or fall in the DOW, you can profit or loss $10 .
Similarly if you are bearish on the DJIA, you can go short on Dow Futures contract. Again, each point decline in the DJIA index will give you $10 as profit. Unlike stocks, you can go short on futures contract without bothering about the uptick rule as none applies on the futures contract. This makes futures trading far superior for speculative purposes as compared to stock trading .
Now, futures trading is risky and if you are a buy and hold type of investor than you should stay away from futures trading. However, if you have an appetite for risk and can monitor the market constantly than you can profit handsomely from futures. Other futures contracts that are popular with traders are the S&P futures contract and crude oil futures contracts. If you are into futures trading than you need to meet High Velocity Market Master, Mark Soberman. He has unique trading methods. He says that he only trades for 20 minutes each day .
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