Several people have recently asked me what a Russell 2000 Index tracking
stock was, so I thought I'd briefly cover this.
The Russell 2000 Stock Index is a great market to trade as it tends to trend
regularly and often has multi point moves many times during any given trading
Many people use Index options and Index futures to trade this index, but
unfortunately futures and options have caused many traders to come unstuck.
That's where trading an Russell 2000 Index tracking stock can be a great
You can simply buy one stock and get exposure to the entire index, without
the massive leverage (and associated risk) of futures or options contracts.
So, what is the Russell 2000 index and why would you want to trade it?
The Russell Index covers 2000 small cap stocks and while it can be volatile,
it is an ideal market for traders once they know how to enter and exit safely.
Below we have a daily chart of the Russell Stock Index...
Even though this chart doesn't show us a strongly trending market, it was great
up-trend that continued for many months.
If you are more of a day-trader, the Russell Stock Index can give you regular
opportunities to enter and exit trades just about every day, and you can trade
the a Russell 2000 Index tracking stock to capture these moves either intra-day
or for position trades.
Here is an intra-day example of a recent short-term run down in this index...
Lower tops and bottoms - an easy down-trend to capture, once you know what to
And here is a longer term intra-day rally (using a 15 minute chart) showing a
14 point rise in the Russell 2000 Index.
The key question is, how do you know when the Russell Stock Index is going to trend
like this so you can get on board?
And what does a high probability trade setup in the Russell look like? It's
one thing to be able to trade a Russell 2000 Index tracking stock, but it's
another thing altogether to make a profit doing it...
To get you started on your way to becoming a professional Russell Stock Index
trader, grab a subscription to our brand new 5 day Futures Trading
You'll learn the 5 key ingredients to successful trading and how to apply
them to the Russell and any other futures market, no matter what your current level of
It's easy to subscribe. Just put your First Name and Primary Email
Address into the form below and click on the Free Instant Access button.
Copyright 2016 Futures Trading Coach
Trading Made Easy LLC
HYPOTHETICAL PERFORMANCE RESULTS HAVE MANY INHERENT LIMITATIONS, SOME OF WHICH ARE DESCRIBED BELOW. NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL OR IS LIKELY TO ACHIEVE PROFITS OR LOSSES SIMILAR TO THOSE SHOWN. IN FACT, THERE ARE FREQUENTLY SHARP DIFFERENCES BETWEEN HYPOTHETICAL PERFORMANCE RESULTS AND THE ACTUAL RESULTS SUBSEQUENTLY ACHIEVED BY ANY PARTICULAR TRADING PROGRAM.
ONE OF THE LIMITATIONS OF HYPOTHETICAL PERFORMANCE RESULTS IS THAT THEY ARE GENERALLY PREPARED WITH THE BENEFIT OF HINDSIGHT. IN ADDITION, HYPOTHETICAL TRADING DOES NOT INVOLVE FINANCIAL RISK, AND NO HYPOTHETICAL TRADING RECORD CAN COMPLETELY ACCOUNT FOR THE IMPACT OF FINANCIAL RISK IN ACTUAL TRADING. FOR EXAMPLE, THE ABILITY TO WITHSTAND LOSSES OR TO ADHERE TO A PARTICULAR TRADING PROGRAM IN SPITE OF TRADING LOSSES ARE MATERIAL POINTS WHICH CAN ALSO ADVERSELY AFFECT ACTUAL TRADING RESULTS. THERE ARE NUMEROUS OTHER FACTORS RELATED TO THE MARKETS IN GENERAL OR TO THE IMPLEMENTATION OF ANY SPECIFIC TRADE PROGRAM WHICH CANNOT BE FULLY ACCOUNTED FOR IN THE PREPARATION OF THE HYPOTHETICAL PERFORMANCE RESULTS AND ALL OF WHICH CAN ADVERSELY AFFECT ACTUAL TRADING RESULTS.