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Old 08-06-2009, 03:56 PM   #1

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Spread Trading

I was interested to know how anyone used and traded spreads. Ive heard this is a good way to trade and used by the pros.

By this im meaning trading the spread between for example

1. an ES/TF/NQ combi pair.

or
2. a dow stock and a dow index.

Is it possible to effectively trade using these methods? Has anyone tried it in the past? What does one chart and what does one take as signals? Any examples would be great.

What symbols are traded, id guess short the dow index and long that particular stock using a respective ratio. Any other ideas?

Thanks in advance,
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