Nadex spreads vs. regular futures

#1

Hi Darrell I have been studying apex system videos for a while great stuff. Could you go over pros and cons of trading oil,gold on nadex spreads or the regular futures contracts. Your insight is greatly appreciated. Thanks Todd

#2

Oil and Gold period are wild beast to trade. They are lower liquidity futures contracts in and of themselves. Especially Gold.

This leaves them more prone to false spikes etc… which can impact any trading system.

Though, I still like trading them - but if doing futures - i will only do them when using the ultimate hedge strategy (and combing it with the MVP filter on my apex trades) as i get less trades but bigger moves.

Spread Pros 1 - there is a cap on risk 2 - you may be able to not have a stop loss at all which can increase your win ratio (depending on if choosing ATM or low risk spreads etc…) 3 - you can have a better ratio risk - as you can make every tick worth $1.00 versus $10 so you don’t have to go from 10 to 20 to 30 per tick - you can keep your risk %'s in balance - using ATM spreads - 4 - no margin calls ever 5 - smaller account size can start trading - larger account size can also trade just fine 6 - and fees cap at 10 contracts so, as your volume increases your fees decrease

Bad side

  1. bid/ask spread is a bit wider but not horrible
  2. you have a more complex decision - multiple spreads to choose from only 1 future
  3. have to take into account any premium (proximity to underlying) in doing the trade (to ensure you pick an appropriate spread)
  4. difficult to scalp with (but great for using as a hedge to scalp the futures with)
#3

Thanks for reply ,if you were a newer trader what would you suggest trading nadex spreads or regular futures on. Thanks Todd

#4

Newer trader, definitely Nadex spreads over futures to begin with.

Note trading spreads or futures requires a lot more patience. For system I suggest apex elite with mvp filters.

Markets usdjpy, gbpjpy, fdax, tf (Small Cap 2000), and potentially oil, corn, soybeans, and gold.

Note spreads and futures are really mainly (consistent day after day) trend trading instruments. Which means you want to trade during higher volume hours (ie 3 am to 12 pm ET) sometimes the afternoon 12 to 4 is great but often it’s flat. Also, the Asian session basically 6 pm to 3 am is usually pretty flat.

If trading afternoon, Asian (evening session) then binaries are much better (ie mvp or boomerang systems - like I taught tonight on the webinar).

These also work great in the morning session.

So part of the answer is not just being new, but also your trading account size, need for active trading vs patience on trends, and schedule.

#5

The biggest difference to me of course is with Nadex you need a lot less money per lot and 1 full SP point only $10 as opposed to futures trading which is $50 believe on the mini. I think the bid/asks spreads are not bad on nadex