Dow Jones Today
Until now, I have written two articles on Index Futures, one being Dow Futures and the other S&P Futures. Since then, my interest in trading Index Futures especially Dow Futures has increased. I am strongly considering the possibility of trading $5 E-Mini Dow Futures Contracts. I am well aware that there are quite a few risks involved while trading futures contracts, but I think after thorough research regarding volatility and other risk factors, I might understand the art of trading index futures. At the moment, I have decided to have a 3 month learning period where I will study the movements of index futures, including what moves them and numerous variables that affect pricing of Dow futures or specifically $5 E-Mini Dow futures since they are also the most liquid index futures based on DJIA.
For those of you who are following the market will know that the Dow Jones Industrial Average has been in positive territory for the past 4 days. I am going to go over the price trend of $10 DJIA futures product, as I wasn't able to find a satisfactory $5 E-Mini Dow Futures chart.
$10 DJIA Futures
For February 19, the DJIA Opened at 10,332 and closed for the day at 10,378 - a rise of 46 points. So, if I had 1 futures contract of $10 DJIA I would have earned $460 for buying and selling the contract at the mentioned selling prices. The DJIA's high for the day was 10,420 - which was 42 points higher than the closing price of the day, a difference of .4%, but in dollar amounts $420 difference for holding the contract and selling it at its high of the day. The low of the day for DJIA futures was 10,280. So, if you bought Dow futures at 10,332 and were worried that the DJIA was going to hit even lower, and sold the futures at 10,280 you would have lost $520 by holding 1 contract of DJIA. Obviously in real life, you are not going to sell at the high of the day or the low, in fact you are not even going to get close those - but they make good examples in demonstrating the significant risks and rewards that futures products bring with them.
Some Thoughts On DOW Futures and Trading
I will be looking for some books on trading index options, and as I track the index futures I will be able to (hopefully) learn some quirks of Dow Jones and see what makes it tick. For now, I am going to make an Microsoft Access Database tracking my assumptions regarding the trend of Dow Futures and various other notes that I have observed while following the Dow.
If you are an investor who has been trading Dow futures for a while, I would definitely appreciate a few inputs regarding its future contracts or any other index futures.
Since I am going to be following the Dow, I will be posting articles regarding Dow and its futures product. I don't think I am going to publish my assumptions regarding its trend, as I don't think it would be wise. But, I will post any relevant information here that I believe would enhance my understanding of the Dow and the futures products based on it.
While you are reading my article on futures contract, I would also suggest you guys to read my Natural Gas Futures article - the article might interest you.
Dow Jones Today
