Speculation is the act of buying and selling to take advantage of market spreads to make a profit based on a judgement of the market. Depending on the general trend of the stock market, speculation can be divided into bullish speculation and bearish speculation. Depending on the direction of the trader's buy and sell side, speculation can be divided into two categories: long speculation and short speculation.

Speculation can be divided into three categories based on the length of time a trader holds an index futures contract.

The first category is the medium to long term speculator, a trader who buys or sells a stock index futures contract and then usually holds the contract for two days, a week or even a few weeks before hedging his position when the price is in his favor.

If an investor goes along with the trend, the speculation can be very profitable, even if he opens a position to buy 1 lot on the last trading day of 2006, the profit on the position is over $400,000 as of early April 2007.
However, medium and long term speculation on the investor's general judgment and psychological quality requirements are very high, both to identify the general direction, but also to withstand the storm, even if the stock market jumped up and down, but also calm and collected, sit and watch the clouds rise and fall.

The second category is short term traders, who generally buy and sell stock index futures on the same day or in a particular trading session, and whose positions are not held overnight.

Short-term trading requires a high level of technical analysis and the more familiar the investor is with the market, the higher the success rate of the operation will be.

The third category is the small profit-seeker, also known as the "hat grabber", whose skill is to take advantage of small price movements to trade for small profits, and they can do many buy and sell transactions back and forth in a day.
In the past, only market makers and proprietary traders had the opportunity and the possibility to "grab the hat", but with the widespread use of electronic trading and online trading, the average investor can now also enter the market and "grab the hat". This trading strategy is not concerned with the general trend of the market, or even the transient trend, but only with the momentary fluctuations in price. Therefore, in addition to having a good sense of the market, investors must also have the advantage of low trading costs to use this trading strategy.