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Options on Futures - 11/24/2009 4:35:50 PM

kinkbound

Posts: 387
Joined: 9/15/2007
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Does anyone here trade options on futures contracts? I've dabbled in trading option spreads with some moderate success in the past, and am contemplating trying this again. However, my former broker is now out of the business. I can't seem to match his commission and minimum initial account arrangement, and I'm not confident enough to trade online yet due to my weak computer and internet skills.

Anyone out there willing to share info either here or on the other side?

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RE: Options on Futures - 11/24/2009 5:08:23 PM

LookieNoNookie

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Joined: 8/9/2008
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quote:

ORIGINAL: kinkbound

Does anyone here trade options on futures contracts? I've dabbled in trading option spreads with some moderate success in the past, and am contemplating trying this again. However, my former broker is now out of the business. I can't seem to match his commission and minimum initial account arrangement, and I'm not confident enough to trade online yet due to my weak computer and internet skills.

Anyone out there willing to share info either here or on the other side?

It's funny that you ask this very question because, as some may not be aware....I actually know everything.

(Except this one thing).

(in reply to kinkbound)

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RE: Options on Futures - 11/24/2009 5:17:20 PM

LadyEllen

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Joined: 6/30/2006
From: Stourport-England
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A question - honestly not intended to be cheeky - have you examined how much of your success was due to the low commission and account arrangement fees your previous broker sought? ie, if you made the same deals with the brokers you found now, would you have made anything or would your gains have been eaten up by fees? ie further, was your broker not charging enough, leading him to go out of business?

E

_____________________________

In a test against the leading brand, 9 out of 10 participants couldnt tell the difference. Dumbasses.

(in reply to LookieNoNookie)

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RE: Options on Futures - 11/24/2009 8:19:25 PM

Musicmystery

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Joined: 3/14/2005
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I'd advise against it.

Futures are risky, and expensive. In fact, they are sold to help manage risk--the risk you are taking on in their place. Unless you're talking that kind of money as, say, 5% of a more balanced overall investment strategy, and are prepared to lose it, pass.

(in reply to kinkbound)

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RE: Options on Futures - 11/25/2009 12:37:24 AM

kinkbound

Posts: 387
Joined: 9/15/2007
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quote:

It's funny that you ask this very question because, as some may not be aware....I actually know everything.

(Except this one thing).

Put me in the camp with those who were not aware that you know everything.

(Wonders which camp is bigger).

(in reply to LookieNoNookie)

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RE: Options on Futures - 11/25/2009 12:48:39 AM

kinkbound

Posts: 387
Joined: 9/15/2007
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quote:

ORIGINAL: LadyEllen

A question - honestly not intended to be cheeky - have you examined how much of your success was due to the low commission and account arrangement fees your previous broker sought? ie, if you made the same deals with the brokers you found now, would you have made anything or would your gains have been eaten up by fees? ie further, was your broker not charging enough, leading him to go out of business?

E

Well, I traded primarily butterfly spreads (lord only knows why they call them butterflies when the formation looks more like a playing card diamond), which is 4 options per trade.

Had the commissions been just a few dollars more per option (not per trade), it would have notably impacted my overall gains. After commissions and fees, I managed to grow my account by slightly over 50% in just shy of a year. I realize that this sounds great. However, considering the time I invested, and the small account I started out with, it was hardly worth my effort. Though the entertainment and ego-stroke value was a factor.

I've no clue what happened to my former broker. The old phone number has been reassigned to a new and unrelated business.

(in reply to LadyEllen)

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RE: Options on Futures - 11/25/2009 1:05:52 AM

kinkbound

Posts: 387
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quote:

ORIGINAL: Musicmystery

I'd advise against it.

Futures are risky, and expensive. In fact, they are sold to help manage risk--the risk you are taking on in their place. Unless you're talking that kind of money as, say, 5% of a more balanced overall investment strategy, and are prepared to lose it, pass.

Indeed, futures contracts are quite risky and prone to huge losses.

Generally speaking, a key advantage of options is that losses are limited to the premiums one pays for the options. Also, there tends to be far less knee-jerk trading manuevers caused by greed and panic emotions, especially when using a disciplined and conservative trading strategy.

I've had fairly good luck so far with this, but past performance is certainly no indication of future results. And I agree that options on futures still falls into the speculative category of investment objectives, though on a somewhat lesser scale than futures contracts.

< Message edited by kinkbound -- 11/25/2009 1:20:41 AM >

(in reply to Musicmystery)

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