Futures Trading IS hard and here is why
After devoting myself completely to trading futures over the last couple of months, I have decided that, at least for me, trading futures is more difficult than trading stocks. Here are some reasons why:
1) You have access to much more margin which is hard not to use, which if used can cause large swings in your account balance, which can be psychologically tiring. In May my account swung wildly and it was hard on me psychologically. One day I would be up big, the next day back down, and then back up and down and up….etc.
2) You have to be more patient. When I day traded stocks, there was almost always a stock to trade with above average volume and an intraday setup. With futures, if you don’t want to lose money, you have to be patient and wait for the right setups, which don’t seem to happen as often.
3) Setups don’t happen as often and they aren’t as nice. When you’re only looking at a few different futures charts, setups aren’t going to happen as often and they aren’t going to be as nice as when you are scanning thousands of different stocks.
4) You have to be more disciplined. Since setups aren’t as often or as nice, you have to be patient. Since you have to be more patient, you need more discipline. Required discipline is one of the things that makes trading so hard.
Basically it is like trying to day trade the QQQQ, except with a lot of margin. Actually that’s exactly what it is. And it is hard. That’s not to say it can’t be done. I know some traders who make money consistently trading futures. Maybe to them it is easier than day trading stocks.
Overall I have concluded it is VERY VERY EASY for novice futures traders to lose LOTS AND LOTS OF MONEY. BE VERY CAREFUL.
