Futures trading

[Iron]

'Spread' simply tracks the difference between 2 prices.

If a horse is 2.98 to back on Betfair and 3.0 to lay, the spread is 0.02. Same principle. Might help clarify it (unless I've misunderstood the term!).

All indicators are lagging by their very nature, which is why I don't go mad on them, but they can provide some useful info.

True, but unless you have a crystal ball, they're the only show in town!

Jeff

[superfrank]

You're getting mixed up by the name Spread.

Think of it as Difference (not sure why they called it Spread).

In horse racing terms it would be the relative price difference between 2 runners.

[Iron]

A book I purchased on High Frequency Trading defines the spread as:

'Typically refers to the difference between a bid and offer price. Also refers to an option trade consisting of multiple options combined to achieve a special payoff pattern.'

I've no idea what the second sentence means, but the first sentence sounds a lot like the definition I gave.

Jeff

You're getting mixed up by the name Spread.

[superfrank]

It's not a spread!, just simply the difference between 2 prices.

[xitian]

Well they're both called "spread".

eg. the "spread" of Betfair share price (or any other product), is the difference between its buy and sell.

eg. the "spread" between oil and the Dow Jones, is the difference between those two prices (perhaps after some adjusting).

The second can be used as an indicator if there's no reason for them to be completely out of whack.

[thomaslowell]

Trading in futures is considered somewhat more risky than the options trading. In the futures trading, the buying trader is obliged to buy the contract. This type of trading is considered more volatile. Still, many investors prefer dealing in it because both parties know the assets that would be sold and bought in the future.

Forex Affiliate

[switesh]

Got an email regarding a HFT conference in London.

http://www.terrapinn.com/conference/tra ... ignId=1242

Very dear to attend, but if any of you do go there please kindly share your experiences - both on the Trading, and Technology side of it.