Micro stock index futures contracts open the door to less risky speculation

Published in: DeCarley Trading Press

The CME is launching less-scary futures contracts to trade stock indices.

While there are a plethora of advantages to trading futures contracts relative to stock market ETFs such as favorable tax treatment, easier tax reporting, around the clock market access, ease of shorting the market, and trading on margin without the burden of paying interest charges to a brokerage house. There is one large bright pink elephant in the room; leverage and the associated risk (large swings in position profit and loss).