Hi-yo, Silver, Away -- The Lone Ranger? Nah Futures Trading
Ever watch the old movie station on television on Saturday mornings when they play westerns? They often run the series, The Lone Ranger. There was even a movie made once. At the end of each episode, the Lone Ranger gets up on his horse and screams -- "Hi-yo, Silver, Away", riding off into the distance on is way to his next adventure. Well, now it's your turn. Kick back the chair from your desk, scream "Hi-yo, Silver, Away", and start futures trading with silver contracts, on your way to your next trading adventure.
Talk about volatility...silver futures trade around 100,000 contracts a day, give or take a few thousand. For those of you who are unfamiliar with the importance of this, volatility measures the relative rate at which the price of a security moves up and down. If you are day trading, it is essential that the contract price move up and down in order for you to capitalize on its smaller intra-day fluctuations. Futures trading silver gives plenty of daily volatility.
Here's the crazy thing about trading silver. There can be more silver contracts traded that the amount of silver available. Right now, there is less "above-ground" silver than even gold. Why? Because nearly all the silver that has been dug-up immediately goes for industrial use. Silver has an incredibly high thermal and electric conductivity. Combine this with the fact that the world's Central Banks have sold off or used up the vast majority of their silver stockpiles and you have major volatility.
The Chicago Mercantile Exchange (CME) offers silver contracts (SI) for futures trading. The intra-day margin for silver is $2500 / contract. But for each price movement the pay out is $25. That is twice what it is for the S&P500 emini futures. Seem a little rich for your blood? No problem. COMEX offers an emini Silver (QI) contract with an intra-day margin of $500. But be careful. Night trading SI, that's hot. But night trading the emini silver -- forget about it. During the day there is good volatility. Unfortunately that volatility falls off rapidly in the late afternoon.
Because there are so many investors interested in silver contracts, the CME keeps raising the margins (3 times in 5 days), thinking that will stop trading. With the dramatic rise in both silver and gold prices, CME's idea is that raising margins will control overheated speculation, and thereby control the increase in price. Did it work? In a word, yes and no. Silver prices plunged. Buyers of silver sold their contracts rapidly. Day traders traded even more furiously. Volatility has skyrocketed. For those holding silver contracts, a painful ride down. But for intra-day futures traders -- a gift from heaven...because it simply increased volatility.
If you have no intention of holding onto contracts more than just a few minutes or a couple of hours, the actual price of silver is not important to you. The fact that it goes up and down in price is all that matters. So kick back you chair from your desk -- scream Hi-yo, Silver, Away! And start trading futures.
Talk about volatility...silver futures trade around 100,000 contracts a day, give or take a few thousand. For those of you who are unfamiliar with the importance of this, volatility measures the relative rate at which the price of a security moves up and down. If you are day trading, it is essential that the contract price move up and down in order for you to capitalize on its smaller intra-day fluctuations. Futures trading silver gives plenty of daily volatility.
Here's the crazy thing about trading silver. There can be more silver contracts traded that the amount of silver available. Right now, there is less "above-ground" silver than even gold. Why? Because nearly all the silver that has been dug-up immediately goes for industrial use. Silver has an incredibly high thermal and electric conductivity. Combine this with the fact that the world's Central Banks have sold off or used up the vast majority of their silver stockpiles and you have major volatility.
The Chicago Mercantile Exchange (CME) offers silver contracts (SI) for futures trading. The intra-day margin for silver is $2500 / contract. But for each price movement the pay out is $25. That is twice what it is for the S&P500 emini futures. Seem a little rich for your blood? No problem. COMEX offers an emini Silver (QI) contract with an intra-day margin of $500. But be careful. Night trading SI, that's hot. But night trading the emini silver -- forget about it. During the day there is good volatility. Unfortunately that volatility falls off rapidly in the late afternoon.
Because there are so many investors interested in silver contracts, the CME keeps raising the margins (3 times in 5 days), thinking that will stop trading. With the dramatic rise in both silver and gold prices, CME's idea is that raising margins will control overheated speculation, and thereby control the increase in price. Did it work? In a word, yes and no. Silver prices plunged. Buyers of silver sold their contracts rapidly. Day traders traded even more furiously. Volatility has skyrocketed. For those holding silver contracts, a painful ride down. But for intra-day futures traders -- a gift from heaven...because it simply increased volatility.
If you have no intention of holding onto contracts more than just a few minutes or a couple of hours, the actual price of silver is not important to you. The fact that it goes up and down in price is all that matters. So kick back you chair from your desk -- scream Hi-yo, Silver, Away! And start trading futures.
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