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• Stephen Cooper

Trading systems for futures

Information on futures trading systems.

If you want to trade in futures you need a futures trading system to further the possibilities of making a profit. When you are trading you must be careful because research shows that in excess of 90% of all futures traders actually lose money over time. However the good side of this is that, since a huge majority is losing over time, it proves that the market follows a pattern and is not random. Now a system will help you identify this pattern and fall in to line. You will thus be able to take the right decisions at the right time and be on the lucky 10% side.

There are 3 basic trading questions.

• When to trade? This is also referred to as Market Timing.
• What to trade? This is also referred to as Asset Allocation.
• How much to trade? This is also referred to as Money Management and Risk Control.

When to Trade: This is obviously an important decision. A futures trading system would take in to consideration a mathematical formula that combines adaptive measurements of price direction, momentum and volatility to define when the markets is ready for you to enter. A system should also automatically adapt to changing market conditions helping you identify these changes and profit from the shifting trends.

What to Trade: Not all markets are good at all times. But some markets will definitely be trade-worthy at this time. So if you wish to start off now, you will need to identify all these trade-worthy markets. A futures trading system can help you identify what to trade and be successful at it. Such a system should also be able to devise a strategy for you, which will guide you whether you should be a long, short or medium term player.

How much to Trade: how much should be your commitment – your futures trading system should provide the answer to this very important question. For best results, you should not invest too much to begin with. Then as you gather more experience and begin to understand the market, you can start to increase your stake.