Micro-DAX Futures: Smaller Contracts for Individual Traders
Daniels Trading | Futures Blog
by Daniels Trading
1y ago
Eurex launched DAX® futures (FDAX) — based on the DAX® Stock Index of the 40 largest German stocks — in the 1990s. It quickly grew to one of the world’s most liquid stock index futures contracts. However, as the index grew along with volatility, FDAX was largely inaccessible to retail traders because of its size and margin requirements. As a result, in October 2015 Eurex introduced the Mini-DAX® futures (FDXM), which is one-fifth the size of the big contract. This greatly expanded the reach of DAX® trading to a much broader audience, yet as the market grew throughout the last decade, even the ..read more
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Eurex Index Futures: A Liquid Global Marketplace
Daniels Trading | Futures Blog
by Daniels Trading
1y ago
Stock traders, investors, and hedgers have long known the value of stock index futures. Traders can access exposures to an entire country’s equity markets or a specific sector within it through various stock index futures benchmarks. Just as an investor can access the broad U.S. market through various iterations of the S&P 500 futures, the largest blue chip stocks through the Dow Jones futures, or the technology sector through the Nasdaq 100, market participants can access many European and global equity benchmarks through Eurex’s family of stock index futures. Eurex is the leading Europea ..read more
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How to Trade DAX® Futures
Daniels Trading | Futures Blog
by Daniels Trading
1y ago
The DAX® futures complex provides a unique opportunity to profit from one of the world’s most dynamic stock indexes. The Deutscher Aktienindex (DAX®) stock index is Deutsche Börse’s index of blue-chip German stocks. Launched in 1988 as an index of the top 30 stocks traded on the Frankfurt Stock Exchange, based on turnover and market capitalization, it now includes the 40 largest and most actively traded German companies. Eurex launched futures on the DAX® (FDAX) in the 1990s and more recently has added Mini-DAX® futures (FDXM) and Micro-DAX® futures (FDXS). DAX® includes such well-known stocks ..read more
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Probabilities are Accurate Until They Aren’t
Daniels Trading | Futures Blog
by Frank Kaberna
2y ago
Almost everything in your life can be viewed as an event with a probability. What are the chances your local grocery store has the item you’re looking for? What’s the likelihood of running into so-and-so if you go to this bar as opposed to that one? What’re the odds you miss your flight if you leave at X:YZ o’clock? What do all the probabilities in your life have in common? They’re all dynamic – constantly changing. At the conclusion of the event a binary 0% or 100% is realized, but the journey to that ending can witness wild swings in either direction. Super Bowl 51 (New England Patriots vs A ..read more
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Neutral Trading Strategies for an Inactive Market
Daniels Trading | Futures Blog
by Frank Kaberna
2y ago
What do you do when the dust settles, the smoke clears, and you’re left with middling markets? After quite a volatile May, June has seen the stock market bounce back (albeit slightly) and the US dollar cool off. STIX & SFX \ Small Technology and Small US Dollar Source: dxFeed (https://dxfeed.com) Many traders hunt price extremes when looking for value in the market, but this strategy can leave you waiting on the sideline for extended periods. Pairs trades, or spread trades, as well as neutral options strategies can create opportunity out of a sideways, seemingly stagnant market. How to Cre ..read more
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OHLC Charts vs. Candlestick Charts: Which Is Better?
Daniels Trading | Futures Blog
by Daniels Trading
2y ago
One of the first steps to becoming a competent technical trader is to choose a suitable chart type. Active traders enjoy a variety of alternatives, from basic line charts to more sophisticated constructs such as point and figure charts. With this many choices, novice market technicians can be easily overwhelmed. Let’s take at the ins and outs of the OHLC chart and the functionality of candlestick charts. What Is an OHLC Chart? An open high low close (OHLC) chart is one of the most common chart types in use today. As the name implies, each price bar notes four pieces of information: the periodi ..read more
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What Are CME Event-Based Contracts?
Daniels Trading | Futures Blog
by Daniels Trading
2y ago
Since its inception, the Chicago Mercantile Exchange (CME) has been an innovator in the trade of financial derivatives. From its lineup of E-mini equities to cryptocurrency futures, the CME provides active traders with a wide variety of alternatives. Read on to learn more about the new event-based contracts and how they may help you achieve your financial goals. What Are CME Event-Based Contracts? Event-based futures are the newest derivatives products offered by the CME. Scheduled for launch in Q3 2022, event-based contracts give traders a small-scale way of trading bullish or bearish market ..read more
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Probabilistic Modeling for Trending Markets
Daniels Trading | Futures Blog
by Frank Kaberna
2y ago
Many mathematicians start with the same, single assumption when they commence any probabilistic modeling: the probability of a market moving higher or lower on any given day is 50%. Though this may seem oversimplified, it is actually quite true to practice if you look at the performance of a few Small Exchange markets in the last year: Market Symbol % of Days Higher % of Days Lower Small Technology STIX 49% 51% Small 10YR Yield S10Y 51% 49% Small US Dollar SFX 52% 48% Small Metals SPRE 49% 51% Small Crude Oil SMO 58% 42% Source: dxFeed (https://dxfeed.com) The uniformit ..read more
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Will the Russia-Ukraine War Cause a U.S. Recession?
Daniels Trading | Futures Blog
by Daniels Trading
2y ago
The Russian invasion of Ukraine in February 2022 brought dramatic uncertainty to the world’s capital markets. As a result, commodities prices spiked suddenly, led by strong bullish trends in crude oil, gold, and wheat. Can the Russia-Ukraine war prompt a U.S. recession? Read on to learn more about the situation and what to expect for the rest of 2022 into 2023. What Is a Recession? A recent Forbes Advisor article defines a recession as “a significant decline in economic activity that lasts for months or even years.” In developed economies, a recession is viewed as being a pullback in gross dom ..read more
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What Are the Four Risks of Trading Stock Options?
Daniels Trading | Futures Blog
by Daniels Trading
2y ago
When it comes to trading stock options, traders defer to the Greek language to address risk. Are you familiar with “option Greeks?” In this article, we’ll teach you about the four Greek risk measures of equities options: delta, gamma, theta, and vega. 1. Delta Delta is the rate of change of a stock option’s price with respect to a change in the underlying stock price. In other words, as stock price changes, the option premium does the same. This relationship is represented as a numerical delta value. Deltas are assigned to calls and puts as follows: Calls When the underlying stock of a call op ..read more
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