Home » Trader Tips » Benefits of Trading the US Treasuries

Benefits of Trading the US Treasuries

bond traders

I started trading the US Treasuries (Ultrabond and 30 Year Bond, UB & ZB) about 6 months ago, switching from Crude Oil (CL). While I loved the idea of being a hot shot crude oil trader, I wasn’t that great at it. Not horrible, but really wasn’t getting much traction.

For a few reasons I switch to the treasuries, or bonds as I usually refer to them, for the reasons below. I’m not saying they are for everyone, but I’ve had far more success with them.

mffu my funded futures discount promo sale rules payout

Big Tick Size

Most people trading the equities are used to $5-$10 tick sizes. Now, these products do move, so it’s not hard to grab a 3 tick movement and there you go, $30. I prefer to go with smaller movements using bigger contract sizing in a product that has a higher per tick profit. The 30 year bond and ultra bond (ZB and UB) both have $31.25 per tick movements. Put on 10 lots of ZB, grab a 1 tick move, and you have yourself a $300+ winner.

A little less rowdy are the 5 year, 10 year and ultra notes (ZF, ZN, and TN). They come in at $15.63 per tick. They also are even less volatile. So on a day I want to take things slow, scalping out 1 tick in these isn’t so bad.

Low Volatility

Mentioned above, but the treasury products have far less volatility than other products most people are trading. The 5 year note (ZF) might only travel in a 10 tick range all day. The 10 year travels a bit more, the 30 year a bit more, and the ultra bond traveling the most. Even range aside, you won’t often see a bond move 20 ticks out of no where. You’ll have plenty of opportunity to get out of a trade that isn’t working out before it’s wrecked you.

fast track trading review promo discount coupon futures trading

Correlation In Bond Markets

Most of how I trade the 30 year and ultra bond is by watching the 10 year. All the treasuries tend to move lock step, so when they get a little out of sync, there is opportunity to get in and wait for the correction. It won’t be much, remember, there isn’t much volatility. But for example if the 10 year is pushing the low of the day and the 30 year is 3 ticks above its low, I’m fully expecting the 30 year to catch up and start pushing its lows also, as an example.

Opportunity to Scratch Bad Trades

Along with the low volatility mentioned above, you can usually get out of a trade for break even, maybe a 1 tick loss, without much effort. As long as you pick entries fairly well, if the volume starts to turn on you, you’ll have time to process what is happening and get out. You don’t often get that opportunity with other products as the train leaves the station fast.

apex trader funding coupon promo discount sale products prices

Conclusion

That’s a little insight into what drew me to the treasuries. They won’t be for everyone as they are a slower moving product, but if you are looking to scalp, the bonds might be what you are looking for. Big tick size, low volatility, and ultimately the ability to sniper pick entries. My kind of product.


Be Notified Of New Trader Evaluation Promotions

Submit your email if you want to be notified of new trader evaluation promotions. I never spam nor sell anything. Usually 2-3 emails a month are sent with the latest deals.


Risk Disclosure:

Futures and forex trading contains substantial risk and is not for every investor. An investor could potentially lose all or more than the initial investment. Risk capital is money that can be lost without jeopardizing ones’ financial security or life style. Only risk capital should be used for trading and only those with sufficient risk capital should consider trading. Past performance is not necessarily indicative of future results.

Hypothetical Performance Disclosure: 

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 of 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 trading program which cannot be fully accounted for in the preparation of hypothetical performance results and all which can adversely affect trading results.

You can read more here: Risk Disclosure

Affiliate Disclosure:

The external links on my site and in my video descriptions to trader evaluation companies and software companies are primarily affiliate links. I earn a commission from these companies on any sale made from people visiting these links. That said, I only recommend companies and software I personally use and actually do recommend. Believe me, I turn down a lot of companies who approach me. You can read my full Affiliate Disclosure here.

Additional Disclosure:

The content provided is for informational purposes only. I do my best to keep the content current and accurate by updating it frequently. Sometimes the actual data, rules, requirements and other can differ from what’s stated on our website. CanadianFuturesTrader.ca is an independent website. You should always consult the rules, faqs, knowledge base and support of any of the websites and companies we link to or talk about on our site. The information on their site will always be what ultimately dictates the current rules of their program, software or other. While we are independent, we may be compensated for advertisements, sponsored products, or when you click on a link on our website. The contributors and authors are not registered or certified financial advisors. You should consult a financial professional before making any financial decisions.