Monday, May 07, 2007

May 7 trade experiment update

This is an update to the trade experiment I took earlier today. I initiated market orders at the same time to:

The P/L was initially down -$50 due to losing the spread on the market orders, but now is up $287 due mainly to the ER2 position.

I initiated this trade based on the positions I saw taken in the COT report, and will look to exit the positions on Wedensday.

Not to many people think you can make money by shorting 1 stock index and going long another.


Anonymous said...

That's too simplistic, you have to adjust the number of contracts. The ER2's average daily range in dollars is about twice as high as the YM's, so you need to trade 2 YM for every 1 ER2.

HPT on 5:24 AM said...

Your right that ER2 would need about 2 contracts of YM as an equal hedge, NQ and ES are closer in dollar amounts. I had a more bearish Bias on the indices, so I decided to leave it as is.

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