A Short Introduction to Dow Jones Futures Trading

Dow Jones futures contract prices are not subject to the same constraints as other stock indexes and trading of the futures contract can vary from time to time by the volatility in oil prices. One of the advantages of trading the Dow Jones futures contract is that you can buy and sell shares very often. The Dow Jones futures contract is traded under the Pink Sheets of the New York Stock Exchange.

Other markets may be closed at times and when these markets open, you may be able to sell your shares. The only problem is if the market closes lower than you expected. You may be forced to sell at a loss or at all since you would have incurred a loss if the market closed lower than you anticipated.

A Short Introduction to Dow Jones Futures Trading

Speculate on price movements

In the futures contract, traders are allowed to speculate on price movements. You are not allowed to trade the futures contract for its intrinsic value. Instead, you are allowed to speculate on movements in prices as indicated by the market makers and the e-mini index. If you are speculating on price movements, you are not necessarily buying and selling shares. You may also be speculating on what the index will do next in terms of direction.

Dow Jones futures trading account

You can open an account to trade the Dow Jones futures trading account online at any financial brokerage firm that offers futures trading account. Opening an account with a firm will give you access to both the e-mini index and the futures trading account. You can make regular deposits to your trading account. You can also open a new discount bond account.

Online futures trading venues

You can also buy and sell the Dow Jones futures contracts and the stocks underlying the e-mini index through online futures trading venues. These venues allow you to trade futures contracts and shares on the same platform. There are also automated trading platforms that you can use from the confines of your home or office. These automated trading platforms provide you with real time market quotes for stocks and futures contracts. You need not invest any money to participate in the Dow Jones futures contract.

24 Hours Trading

The trading in the futures contracts is done twenty-four hours a day across the globe. Dow Jones does not have an offset to accommodate fluctuations in global markets. The Dow Jones Index futures contracts start trading hours in New York and end trading hours in London. There are also regional exchanges for the index futures contracts for instance if you are trading in the New York Stock Exchange, you can trade in the London equity index futures trading hours.

Identify a good entry and exit point

An important component of the successful trading strategy is to identify a good entry and exit point for entering the position. This is where a good quality trading platform comes in to play. You need to look for a trading platform that gives you a range of entry points based on the size of the move in the market and a good quality scalping strategy that will get you to these entry points before others can steal the show.