If you are one of the vast majority who thinks only of 'investing' when you think about the stock market, you are aware that prior to 'investing' in ANY stock, you have to (or should) do considerable research before you make a decision selecting a stock to risk you money on it. That is a time-consuming endeavor and an absolutely essential part of 'sane' investing. Most folks usually just leave this to their mutual fund manager or stock broker, hoping he or she is the true professional they claim they are.
On the other hand, those who are e-mini traders (rather than stock investors) have a very simplified procedure to go through. So simple, in fact, that no research whatever is ever necessary before executing an e-mini trade. If you have spent any time on my web site, perusing all of the FREE information I've place there for you, you're aware that the only thing we are trading and concerned about monitoring … is the INDEX number of the market we are trading, eg, the S & P 500 Index, the Russell 2000 market Index, etc.
E-mini's are traded in several different markets and are not only much simpler and easier to trade than stocks, but even more easy to understand. No research is ever needed. You simply watch the 'price-action' movement of the market Index [itself] for 'patterns' that tell you when to enter a trade and then when to close the trade. Our trades are seldom open longer than 4-5 minutes, at most. Usually, shorter. All markets go in two directions each and every day, hour, even minute – UP and DOWN; and, for periods, they may go sideways (consolidating, they call it).
Stock investing requires research to select stocks one thinks worthy (that is, promising enough) to risk his money on. The E-mini trader need only watch for a price-movement 'signal' of [ONE] Index number, and when he sees it … he clicks his mouse and he's 'in the trade'. Smart traders decide before getting into a trade how much they are going for and enter their 'exit' instructions to their computer at the same time they enter the trade – Know where you are going to get out before you get in … and don 't get greedy! Mastering this one little principle will ensure any person becoming a successful e-mini trader.
For more about the lack of research e-mini trading requires and the psychology of trading, spend some more time on my web site and blog. Next post …. we'll discuss the low start up costs of getting into e-mini trading … vs stocks – Our Reason # 2.