low volume ---- > bid offer spread very wide ----> sleepless night. Perhaps you should try trading very low volume futures, and see if you can sleep or not.
Its volume is fluctuate dependent on time of the day. Further months contracts are also traded. /NG and /HH are virtually identical. Therefore I see it as an arbitrage rather than spread trading. Anyway, there are people trading this spread and I want to know how they make money from it.
It's there, you just need to search intermarket spread margins... 98% credit? Dude, it would be like 20 bux margin requirement. Edit, did some quick math on the next few expirations...Yer looking at from 90 bux to 120 bux margin requirement on the spread, depending on yer expiry dates. Still, pretty damned inexpensive.
NG day range is very good (about 120 ticks). very suitable for outright day trading. I am no expert in spreading NG. I am sure there are traders who do calendar spread, trade spread across various energy products, trade gas products spread across various areas ...
The machines trading that ARB are much faster than you like no joke 1 million times faster and because you have to pay slippage on both sides and you must pay non member rates fees and commission unlike the algos n bots who are owned by the members then you will see it truly is an ARB but its well out of the realm of most mortals due to slippage fees and commissions. thats the problem with spreads you need priority on both sides which involves speed in the cancel and speed getting back in the order book. I wouldnt trade it due to these reasons. Even if it an exchange traded one you still pay slippage. Curremcies are spreads against another currency. they are paired maybe start there since some of them can move but stick with a slow one. like the new zealand dollar.
Oh, thank you so much. So, it is inter commodity spread.... I thought it was intra... Now let me contact AMP if they can provide me this margin....
As I always use limit orders slippage is not a concern to me. It moves really really slow, you have enough time to manage your positions. Manual spread trading is highly profitable.