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Wednesday, November 30, 2011

How Entrepreneurs are Tapping Into a New “e-Mini” Market and Producing Cash Profits 24/7

How Entrepreneurs are Tapping Into a New “e-Mini” Market and Producing Cash Profits 24/7

You Gotta See This To Believe It!

7:03 AM

Dear Entrepreneur:

When I saw this new “e-mini” market I knew readers would be interested.

You can make money in this market and business just like entrepreneurs around the globe are doing.

I’ve shown you opportunities in the futures markets.

But… full futures contracts can be very risky, and especially for new traders who haven’t learned “the ropes”.

Granted, nothing compares to the profit potential and leverage of full futures trading. But with opportunity comes serious risk.

In a small café in Wilmington NC recently…..(Wrightsville Beach to be exact)…a fellow entrepreneur showed me this new “e-Mini” market.

I’ll show you how it works and how to make money in it.

·        I Am Not Offering Investment Advice 

The information in this week’s issue is only provided to give you a basic understanding of this new e-Mini market. It is not intended to provide specific financial or investment advice for you.
On top of that, you should not act or rely on the information without seeking the counsel of a qualified financial adviser or futures broker. They can help you determine whether this is a good fit given your financial situation. 

Okay, now that you’re scared you to death… let’s move on!

What is an e-Mini Market?

The market I’m talking about is electronic, thus the “e”. It’s a much smaller market than the traditional market, thus the “mini”.

This new market is one way to participate in the larger market without huge capital requirements.   

What’s more, the contracts in this market are really small enabling an entrepreneur or trader to get involved with less risk, leverage and capitol. 

The popularity of the “e-Mini” market is growing like crazy because it’s easy to get involved, as well as get in and out of the market quickly (this is called liquidity). 

There are more than a dozen “e-Mini” contracts you can trade, in markets such as the S&P 500, Dow, NASDAQ, Russell, grains, currencies, metals, and energies.

A New “e-Micro” Gold Futures Contract!

e-Mini futures are a great fit for most traders and investors.

But now, CME has launched a new product called the e-Micro Gold Futures contract. It’s even smaller than an e-Mini contract, which can reduce your leverage and risk even more.

These are widely traded too so you can get in and out of contracts quickly.

The Risks of e-Mini Futures Trading

In deciding whether or not you want to become involved in any type of futures trading you should be aware you could both gain and lose large amounts of money. 

In other words, you risk losing money because:

1.  You could lose all the margin funds you deposit with the futures broker to establish or maintain a futures position and lose further amounts
2.  If the market moves against your position, you may be required, at short notice, to deposit with the futures broker further monies as margin in order to maintain your position. Those additional funds may be substantial. If you fail to provide those additional funds within the required time your position may be liquidated. You will be liable for any shortfall in your account resulting from that liquidation.
3.  You could lose all monies deposited with the futures broker, and in addition be required to pay the futures broker further funds representing losses and other fees on your open and closed positions.
4.  Under certain conditions, it could become difficult or impossible for you to liquidate or close a position (this can happen when there is significant change in prices over a short period).
5.  The placing of contingent orders (such as a "stop-loss" order) may not always limit your losses to the amounts that you may want. Market conditions may make it impossible to execute such orders.
6.  The high degree of leverage that is obtainable in futures trading with the futures broker because of small margin requirements can work against you as well as for you. The use of leverage can lead to large losses as well as large gains.
7.  Futures and options trading are not appropriate for everyone. There is a substantial risk of loss associated with trading futures and options on futures. Only risk capital should be used.
8.  No representation is being made that futures and options on futures trading is appropriate for everyone or that it should be viewed as an alternative, replacement or supplemental form of income.

You should discuss these matters further with a commodity broker prior to commencing any trading.

The Trick for Reducing Risk

It’s not a secret.

There’s a risk of losing money when trading precious metals e-Mini futures.

But here are two of the best kept secrets to reduce risk.

One is with the new e-Mini futures I’m telling you about.

The other is to NEVER trade more than four contracts at a time (no matter how much money you’re making).
When I say limiting trades or “open” positions to four contracts, this doesn’t mean you can’t do this over and over and over. It simply means you LIMIT the number of contracts at any given time.

This is where the amateur traders (also known as rookie gamblers) fall by the wayside.

I know the following info is pretty technical….but it’s good to review so we’re all on the same page.

Marc’s Snapshot of e-Mini Futures Trading

A futures contract is an agreement (obligation) to buy or sell a given quantity of a particular asset at a specified future date at a prearranged price. 

Futures contracts have standard delivery dates, trading units, terms, and conditions. They can be based on any one of a number of underlying assets. 

There are futures contracts available in stock market indices, bonds, interest rates, coffee, sugar, orange juice, and agricultural commodities. 

You can even trade catastrophe futures (they deal with insurance) at the Chicago Board of Trade!

The best and most trusted futures and e-mini contracts are traded on government-regulated exchanges like the Chicago Board of Trade (the largest futures exchange) and the IntercontinentalExchange (aka ICE).

You’ll find futures exchanges in most industrialized countries.

You can find futures and e-mini prices on most financial websites on the Internet.

The total number of contracts traded on the Chicago Board of Trade and ICE in 2010 was valued at more than $800 trillion!

You can "open" a futures or e-mini position by either buying or selling a contract. 

You can "close" a futures or e-mini position by doing the exact opposite − either by selling or buying the same contract. 

If you think the price of the underlying asset will rise, you would buy a futures position. This is referred to as being "long." When you buy a futures contract and hold it to expiration, you would be required to take delivery of the underlying asset, or equivalent cash value, at a prearranged price and by a certain date.

But don't worry, only a small percentage of futures contracts are held to expiration. Most of the money is made during the life of a contract.

If you think the price of the underlying asset will fall, you would sell a futures position. This is referred to as being "short." 

When you sell a futures contract and it is held to expiration, you would be required to deliver the underlying asset, or equivalent cash value, at a prearranged price and by a certain date. 

Beginning traders often have difficulty grasping the concept of selling something they don't own. What you are doing is simply selling something on paper - via the contract. 

Take some time to study the basics of future trading and you’ll start to get a feel for it. I’ve also included some great resources in this week’s issue to help you, including world-class tutorials.

How to Make Money in the e-Micro Gold Market

In upcoming issues I’ll talk about e-Mini opportunities in the stock market, agricultural, energy, oil and even the interest rate market.

But today I’ll give you a quick lesson for making money in the e-Micro gold market.

There are basically two ways to make money in the e-Micro gold. The first way is if you believe prices will rise in the coming weeks. The second way is if you believe the prices will fall in the coming weeks.

Okay….let’s say you believe prices will go up over the next six weeks or so.

In this case you would buy one August e-Micro gold contract “at the market”. At the Market means the current prevailing price….which is the way I always trade.

Let’s say the current price is $1475 per ounce.  The size of an e-Micro gold contract is ten troy ounces. This means when you buy an e-Micro contract you “control” ten troy ounces of gold. At the current price in our example the value would be $14, 750.


Remember….You won’t take delivery of this gold or even handle the physical commodity. You’re simply trading the digital equivalent – a contract.

Let’s say gold moves up to $1500 in two weeks, and you sell the contract “at the market”. You would have made a profit of $250. Not bad but not great.

However, now buy two August e-Micro contracts “at the market”. The price moves to $1550. You own two contracts so the value jumps to $31,000. You sell both contracts “at the market”. Your profit this time is $1,000 ($50 x 10 ounces = $500 x 2 contracts = $1,000).

We use this strategy two more times but NEVER trade or hold more than four contracts at a time.

We buy three contracts “at the market” when the price is $1575, and sell all three when the price hits $1600. Our profit this time would be calculated as follows:

3 x 10 = 30 troy ounces x $25 ounce = $750.

Lastly, we buy four e-Micro August gold contracts “at the market” (at $1600). The price moves to $1650 within our six week time frame. Four contracts x 10 troy ounces = 40 x $1650 = $66,000.
$66,000 minus the price we bought ($1600 x 40 = $64,000) = $2,000 profit.

Our total profit in this hypothetical trading example would be $4,000!

If gold continues to move upward we could start over again small by trading only one contract, and increasing to ONLY four…..and then starting over again.

The beauty of trading like this is removing profits (in this case $4,000) from the table. Amateur traders and investors almost NEVER do this or have a legitimate exit strategy.

If you believed the price of gold was going down you could use this strategy to go “short” or sell contracts. In other words, you could use this strategy in reverse.

The e-Mini and e-Micro markets offer exciting profit opportunities like the one in this week’s issue.

Have fun and play nice!

Your humble host,

Marc Charles

(Ed Note:  Marc Charles is referred to as "The King of Business Opportunities" ....and for good reason. He should be known as "The King of Legitimate Business Opportunities"...because he's launched, bought, sold reviewed and advised on hundreds of businesses and money making opportunities. He understands legitimate opportunities. Marc has agreed supply League of Power members with crucial updates regarding legitimate business and money making opportunities.)
*** Action Strategy ***
You can practice placing trades in the e-mini market before risking a dime.
I’m serious.
If you follow the guidelines I’ve outlined in this week’s issue you can place a trade in the e-Micro gold market “on paper”.
Simply jot down the price of the contract when you place your “paper trade”.
Then utilize the buy and sell using the strategy I taught you.
Make note of your profits (or losses). And never trade more than four contracts.
In a couple of weeks you can review your “paper” profit and loss. Once you get a hang of this strategy “on paper” you can start trading using real money.
Lind-Waldoch is offering a $50,000 paper trade account for free – check it out here

***Valuable Resources ***
Futures Exchanges
Intercontinental Exchange
CME Group – Chicago Board of Trade
CME Group - Chicago Mercantile Exchange
NYSE Euronext
Global FOREX
Kansas City Futures Exchange
London Metal Exchange
Minneapolis Grain Exchange
New York Stock Exchange Euronext
Shanghai Futures Exchange
Tokyo Commodity Exchange
Winnipeg Commodity Exchange (now part of ICE)
Futures (and eMini) Brokers
PFG Best
R.J. O'Brien
MF Global Futures
Great Pacific Trading Company
Zap Futures
Traders Network

Recommended Books for Futures and eMini Trading
The Very Latest E-Mini Trading: Using Market Anticipation to Trade Electronic Futures by Michael Guttman
E-mini Trading Companion by George Krum (Kindle book)
The New Market Wizards
by Jack D. Schwager

All About Futures
by Russell R. Wasendorf

Diary of a Professional Commodity Trader: Lessons from 21 Weeks of Real Trading
By Peter Brandt
Trade Your Way to Financial Freedom
by Van K. Tharp

Winning in the Futures Markets
by George Angell

1 comment:

  1. Its year informative topic. It help me very much to solve Some Problems specially risk management. Its so fantastic and Opportunity are working style so speedy