Thursday, November 18, 2010

Silver Margin

The Chicago Mercantile Exchange increased the margin requirement to trade future contracts of silver twice in the past 2 weeks. As a small retail trader, this only matters if you hold overnight. Day trading is still 1k (8 times less) per contract. If you are trading overnight, you can still use the mini-silver contract as the margin is still $1,755. I wonder if NYSE (mini) will follow Comex's steps soon. A 1 point move in silver = 5k vs 1k for the mini. Plus, we all know that a 1% move in silver at $26 vs $17 a few months ago seems more drastic now, especially with futures as each tick remains the same.

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