A New Investment Strategy: Time

By Nelson Pellew

Getting the better of the markets is never a straightforward proposition. Investments can be a problematic prospect, especially for the average investor whose only aim in to grow his or her nest egg. Indeed, in some regards these investors are the backbone of the industry. That being said, they can also be some of its most dramatic victims. One mismanaged trade can be the ruin of any fortune -- and often is.

For this reason alone, many go-it-alone investors prefer to add a new dimension to their investment strategy: time. To the uninitiated, this means they prefer to trade in futures. This means investors can utilize traditional commodities or E-mini index funds to leverage the projected value of commodities at some point in the future -- hence the name.

Given the fact that futures trading is not bound by the open and close of Wall Street, an investor can enjoy the privilege of round-the-clock trading via any global exchange. To be sure, the futures trader does not look to New York as much as he or she looks to the Second City, Chicago. The Chicago Mercantile Exchange is the mecca future traders turn to seek their fortunes.

It should be noted that although futures allow for greater investment flexibility, they require ready access to significant amounts of liquid capital. That is, they require access to cash -- and lots of it. This is so because should your E-minis drop below the CME margin call, you will be required to ante-up, as it were. You can't take your place at the roulette wheel unless you can afford to buy the placards, you see.

What futures promise -- and often deliver to the savvy strategist -- is the potential for dramatic gains. With a handful of E-minis, some commodities traders can reap a veritable financial whirlwind. Of course, this is subject to training and it would be in the best interests of the would-be futures traders to enroll in a futures trading course before embarking on too rigorous a trading regiment. - 31869

About the Author:

Sign Up for our Free Newsletter

Enter email address here