Following are the most frequently asked questions by traders/clients about our Emini Futures Trading service. Last Updated: 31 Jan 2020
1. What is the Emini S&P500 Futures contract?
The Emini S&P 500 Futures contract (ES) is one-fifth the size of the standard S&P500 Futures contract (SPX), with 50 units per contract. Emini Contract Size = $50 x S&P500 Index. So one point gain in the Emini Futures translates to $50 gain. The advantage of trading Emini contracts include high liquidity and low cost per contract. Emini futures are available on a wide range of indexes such as the S&P500, Nasdaq100, Dow, MidCap400 and Russell2000. The Emini S&P500 futures contract is traded on the Chicago Mercantile Exchange (CME Globex system). When we say Emini Futures on this site, we are referring to Emini S&P500 Futures.
2. What is the Micro Emini S&P500 (MES) Futures contract?
The Chicago Mercantile Exchange (CME) introduced the Micro Emini Futures on 6th May 2019 to make create smaller contract size for trading the S&P500 index. Please Note: their code is MES. The Micro Emini S&P500 futures (MES) offer smaller-sized versions of the highly liquid S&P500 Index, widely regarded as the best single gauge of the US economy, and increasingly, the global economy, because half the revenues and income of the S&P500 index comes from outside the USA from countries across the world, and therefore, investors worldwide keep investing in the S&P500.
The Micro Emini (MES) contract is “one-tenth” of the standard Emini(ES) contract.
– One point gain in the Emini S&P500 (ES) futures would give $50 gain.
– One point gain in the Micro Emini S&P500 (MES) futures would give $5 gain.
The margin capital requirements for MES are just 10% of the ES contract. So they are about $600 currently for carrying the futures position overnight (non-intraday), which is our trading approach.
3. Are you using the Micro Emini S&P500 Futures contract?
Yes! We are now using the Micro Emini contracts (MES). We have tested different position sizes to see what is the optimal position size for our trading style. Earlier we are trading with 1 Emini futures. That was our default trade size and it was also the minimum possible trade size. With Micro Emini (MES) futures, we needed to get a new lower position size that reduces the margin capital (and risk) per trade, without losing too much gain from the identified opportunity.
From 01 August 2019, we have finalized on 5 Micros as the default trade size. So all our trades are with 5 Micros per trade (which is equal to 0.5 Emini Futures). So we have reduced our default trade size by half using the Micro Eminis (MES). In the ideal world, we want the largest position size on a profitable trade, and the smallest position size on a non-profitable trade. We are very selective in taking the trades (we are doing 1-5 trades per month, sometimes just 1-2 trades per month if our monthly performance target is achieved). So once a good opportunity comes, we don’t want to reduce the position size too much like (1-2 Micros) otherwise the target gains won’t come despite having a good setup. In some cases, where the set up is good, we may still use 1 Emini Contract to maximize the gain from that particular opportunity.
Please Note: Volatile market conditions need smaller position size and wider stop loss. So in volatile market conditions, where we see a clear target, we will go with a smaller position, like 2 Micros per trade, with wider stop loss and larger target like 50-80 points gain per trade, and we have actually done such trades in August 2019.
4. How can I benefit from your trading service?
Our real-time SP500 Emini Futures trading signal/alert subscription via email will make you at least 20 points per month, which translates to $1000 per Emini contract per month (Emini Contract Size = $50 x S&P 500 Index). We have fixed fee at $500 per month, so that any Emini futures trader can make a good profit trading with just one contract. You are welcome to trade with multiple contracts and increase your profits. Of course, if you share your exact trading capital with us, we can work with you to increase your profits by more effective strategies that can be used when we trade with 10+ contracts. We can also help you trade the Nasdaq100 Futures, but that service is suitable for traders with at least $100K trading capital. Overall, for traders of all backgrounds and account sizes, our top recommendation is the S&P500 futures, either ES or MES, based on capital. There is no other equity index like this in the whole world. We should maximize the benefits from it!
5. What is your experience in Emini Futures trading?
We have 15+ years of experience in trading S&P Index ETFs and S&P500 Emini Futures. We also have experience in trading Dow Jones and Nasdaq index futures and ETFs, and FTSE100, Nifty50, Hang Seng abroad. The S&P500 is our absolute favorite equity index in the whole world, and no other equity index comes close to it in terms of stability, resilience, and stunning rebounds from every major correction. We love and respect the S&P500 for all the income it has give us over the last 20 years. Please see the Emini Futures Trading performance page.
6. What makes this service special or unique?
No performance, no fee! Your monthly profits must be more than our fee, otherwise we don’t take any fee! We are passionate traders (with our own trading company) and we see S&P500 futures trading as a life-long learning and profit sharing experience. By aiming for returns lesser than the market, and cutting out regularly, we have done many small but profitable trades. 100% Money Back Guarantee if you don’t make 20 S&P500 points per month, which translates to $1000 trading gain per Emini (ES) contract per month. Our fee is fixed at $500 per month. You can trade multiple contracts to increase your profits.
Please Note: Our 20 points per month Performance Guarantee means that even if we make 19 points trading gain in a month, we will offer a refund, though most of our trading group members have not wanted refund in such cases, when they have made good gains, while some asked for the fee to be rolled over to next month in the few rare cases when we are below 20 points in a given month.
7. What kind of gains or ROI can we expect from trading with your service?
So far since 2015, we have made 200-280 points trading gain every year, using the trades shared with our trading group members/subscribers. Once we have made 20 points trading gain in a month, we become very cautious, because out winning strategy is to exit after the gains and come back next month. If you consider 240 points gain per annum (at 20 points per month average), then that’s a gain of $12,000 per annum with 1 Emini S&P500 (ES) futures contract. The margin capital for one ES contract is about $6000, and need some buffer capital for stop loss. So a typical account will need $8000 capital. Even after our service fee, the ROI will be about 100%, with one ES contract. Traders with 2 or more contracts will have higher ROI because the service fee remains the same but trading gains increase.
8. What is your S&P500 Emini Futures Trading Strategy?
We have been watching and trading the S&P500 for over 15 years, and there are some regular movements and some irregular movements. At each key level, we are constantly trying to evaluate the probability and size of the next upmove versus the next downmove. The summary of our S&P500 Emini Futures Trading Strategy is that we are constantly trying to see where the set up is good, for getting 30-40 points with 10-20 points risk. A set up that looks good for 30-40 points gain will surely give 20-25 points gain, and that’s what we need to meet our monthly target. And if we keep repeating it, we will arrive at 100-150% ROI per year. We have spent thousands of hours studying the S&P500 and Dow Jones charts over the last 100 years, on various timeframes. The learning and insights from that study/research creates the consistent performance of our service.
About 1-2 months in each year, we may miss the performance guarantee of 20 points, but other months will make up for it. For example, in March 2019, we made +64 points trading gain from three trades. We could have stopped at 20 points, but we went on till 60 points because the setups were very good, and we wanted to accumulate the gains, while they were coming in a clear way. On the other hand, a month like July 2019 was very complex because of rare/divergent signals from different indicators, which was making it difficult to carry trades with confidence, so we just aimed to get 20+ points and cut out of the market. August 2019 started with a large cut of 200 points within the first 5 days, and the S&P500 futures were deeply oversold, so a recovery was inevitable, and we gained from that.
9. What kind of gains or how many points per trade do you typically aim for?
We trade the Emini Futures with price targets, which may come the same day, or typically after 1-2 days. We are not doing intraday trading, so we are not looking to close our position just because the day is over. In fact, many of our targets get hit after market hours and in pre-market hours.
We aim for about 15-22 points per trade, and we trade with the market direction in most cases, and we try to buy in deeply oversold markets, while others are still worried or unsure. Such trades give 30-50 points as soon as market sentiment becomes positive, which sometimes happens within 24-48 hours. So we do a mix of direction trading and contra trading. It depends of the sequence of events that has led to the current price.
Our preferred approach is to take 20-25 points in one trade when the set up is good. As you probably know, “Double your money in 100 days” kind of trading schemes rarely work, and there is always a big risk with such trading schemes of losing the entire trading capital. We really like the S&P500. It’s the most reliable equity investment in the world. The summary of our Emini futures trading strategy is that we offer our capital to the market on sharp corrections and take profits after market recovery or upmove.
Aug 2019 was a month of high volatility for the S&P500 futures, one of the highest since records are being maintained for futures since 1982. But while the futures were moving up and down with high speed, they were still trading inside the circle (drawn on the chart) during the entire month, which provided us with many good trading setups, which typically come when the futures are trading in a range. You can say, this is part of the experience or insight, which helps us create better trades.
In the above chart, each of the 4 trade setups (shown with 4 green arrows) was enough to meet out monthly performance guarantee of 20 points. So, for active traders, August 2019 was a nice profitable month even if we worked with fewer contracts to account for the high volatility, which required smaller position size and wider stops.
10. How many contracts should I trade with?
It depends on your trading capital. As a thumb-rule, we never trade Emini Futures with more than 50% of our trading capital. So at least 50% of our trading capital stays away from Futures Trading, in Cash or Money Market Funds, or Index ETFs (SPY). The 50% trading at work is enough to generate the necessary profits to grow. Range-bound markets are very good for trading with more volume. After the S&P500 has made large moves on upside or downside, we have to be more cautious because reversals are likely.
As mentioned in the answer to Question#2 above, from August 2019, we have finalized on 5 Micros contracts (MES) as the default trade size (it was earlier 1 Emini contract). So all our trades are with 5 Micros per trade (which is equal to 0.5 Emini Futures). This would be your minimum trading size with our trading service. It would require about $3000 as margin capital, and you should have about $5000 in your trading account for do this trading.
11. How much capital is needed to trade S&P 500 Emini Futures?
With the arrival of Micro Emini S&P500 (MES) futures since May 2019, the capital requirements have reduced sharply, because the Micro contract is one-tenth the Emini contract.
From 01 August 2019, we have finalized on 5 Micros as the default trade size. So all our trades are with 5 Micros per trade (which is equal to 0.5 Emini Futures). So the minimum capital required to for trading with our service will be $3000 margin capital for 5 Micros plus $2000 reserve capital, so at least $5000 will be required in the trading account.
The minimum margin to trade one Emini Micro S&P500 (MES) futures contract is about $600, and you need about $5000 to open a futures account with most brokerages. We often carry positions overnight till the target or stop loss is hit. So you should plan for a fully funded trading account. Some traders trade intraday using our inputs till the target/stop is hit. You don’t need any special system to trade with our inputs. If you can enter orders on a web-based system, that is enough.
Please Note: We use limit orders for all our trades, so please be ready to trade with limit orders. You are welcome to trade with multiple contracts. If you inform us how many contracts you are trading with, we can also help you with our inputs regarding your position size vs your total trading capital, and trading goals.
12. What are the usual timings of your service? For sending out trading alerts?
Over the past 5 years, most of our trading alerts have been sent out between 6:00 am to 6:00 pm New York time. We aim to send our emails with new trades and trade updates as soon as we find a clear signal to take action. In our observation, the 12 hours from 6:00 am to 6:00 pm New York time are the important hours. Many times, new trades may start before market hours, or after market hours.
13. Do you work with any funds or large traders?
Yes, we have worked with a variety of traders and funds. Some individual clients/traders are part of a fund or trading company, and that’s okay with us. Everyone is looking for profits but those who have modest expectations seem to be the consistent winners in most cases. In the next couple of years, we expect to work with some traders and funds, who can trade with 20+ Emini contracts ongoing basis.
14. Any special package for large traders?
Yes, the futures trading strategy is different when you can trade with 10+ Emini contracts and hold for 1-2 weeks because it enables deep discount buying during panic days and allows the partial profit taking on sudden market jumps. Large traders can aim to make 20-30 points per month per contract on annualized basis, or 240-360 points per contract per year. The trading with large positions is very dynamic and we may rapidly decide to close out half/all the positions with available profits if some warning signs appear. We communicate regularly with larger traders using email, phone, Whatsapp/Google Hangouts. We can work with a fixed fee, or 15% profit sharing agreement.
15. Do you have any free trial?
Yes, if you want to try or observe our service with real-time, real-life trades, we will be happy to share our trading emails with you as soon as they go to our trading group. So you can see those trades first hand, and see how they play out. We can do this for up to 1 month. For example, if you are contacting us on 10th Sep, you can get the all Sep month emails with trades and market notes, and decide if you want to start from 1st Oct.
16. Do you have any social media page?
Yes, we have a facebook page where we share our market views and some bonus trades.
17. How do I order your service? How to get started?
Getting started is easy. We will add your email id in our trading group and you will get all the emails that go out to our trading group, which includes the trades. Service fee is paid via PayPal, and we will give you a PayPal payment link. Please contact us to get started.
If your question is not answered above, please contact us, and we will be happy to answer your question. Thanks.