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The following diagram summarizes the pros and cons of floor vs. off-floor trading. It was a clear as day, if I wanted to be a profitable day trader I had to be trading on the floor. Direct Access Trading Today, the trading floor at LIFFE no longer exists; it has been replaced by banks of computers. All trades executed through LIFFE are executed and matched electronically. If you walk through the offices of LIFFE, situated on what was the trading floor, there is an eerie silence that belies the colossal size of financial transactions that are being made every second. The floor locals (independent traders), as they were, no longer exist; the unique advantages they enjoyed have disappeared, replaced by a level playing field that all traders can share. The opportunities that were once the preserve of the local trader are now available to everyone; the advantages of the floor trader have combined with the advantages of the off-floor trader. It is the direct access trader who rules and it is about the opportunities that direct access trading offers that this course is about. 9 In this book I will give you A grounding in the basic theory behind the futures market An overview of what you need to do, know and have to start trading with a direct access broker A guide to trading the Stock Index futures market (E-Mini S&P, FTSE100, DAX, and more) And my perspective on how to develop your trading skills Trading skills The word skill is carefully chosen, as I believe that trading is a game of skill. I see trading in the same way that I see tennis or golf, or any other skill based activity. What is critical for the development of any skill is practice and experience. It is no coincidence that the most successful floor traders that I knew were also the ones who had been trading the longest. This book is a personal perspective on the business of trading and one that I hope you will find stimulating, rewarding and fun. 10 Chapter 2: The Futures Market |
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