Spreadbetting bucketshops

oildaytrader · Oct 24, 2009

Spreadbetting firms offer you tax free earnings.

Are they any better than seedy bucketshops ?

http://www.trade2win.com/boards/metatrader/74696-metatrader-bucket-shops.html

I had a call from the owner of a spreadbetting company , encouraging me to start FX trading.I asked the question if FX trading is so profitable , why do you not do it yourself and make millions?

The answer was obvious " W e are looking for mugs to lose their life savings betting or gambling'

We at C M C hand it you on a plate is a very famous slogan by C M C .

What do u hand on a plate ?

What lies do you hand to clients?Tight spreads?What tight spreads?

Once I had a position closed overnight by a spreadbetting bucketshop .I phoned and asked " the market never reached the level , so why did you close it?"

The answer was " We run our own books"

I wonder who was running the other side of the bet.It was the owner of B G index , meaning Bucketsshop Gold Index.

KEEP AWAY FROM THESE SPREADBETTING BUCKETSHOPS

Their own book positions against traders are taken by the owners of these spreadbetting bucketshops

0007 · Oct 24, 2009

SB firms are just like the market: they're there and it's up to you to pit your wits and skill against them. If, as is commonly asserted, only 5% are successful in the market, why should SBs be any different?

Play them at their own game and you can do OK, if not - best stay away.

shadowninja · Oct 24, 2009

Tin foil hat at the ready?

I've not had any problems with IG (beyond Java problems meaning sometimes the system would just freeze for hours (irrespective of whether I was in or out of the market). Resolved when the new version was launched. The market plummeted when I last used IG, I am not using guaranteed stop losses... I was slipped for zero pips (ie it took me out at my stop loss and not a pip more... yeah, I was surprised as it was dropping 20 pips per tick).

Alpari slipped me twice for about 20-30 pips in 2008 so I can't complain. Many times it's gone to under a pip near my stoploss and reversed for profit.

Damn those bucket shops.

oildaytrader · Oct 24, 2009

0007 said:
SB firms are just like the market: they're there and it's up to you to pit your wits and skill against them. If, as is commonly asserted, only 5% are successful in the market, why should SBs be any different?

A skillful trader has an edge over the market , and this edge is normally a few points .
That edge is fictitiously eroded by these bookies operating their own books against the trader.These spreadbetting firms are not like the market, they are trading when the market is closed.EFEECTIVELY THEY ARE NOT THE MARKET.You savings are entirely in the hands of these taxmen/crooked book.

The broker hedging your trade in the market is trading with you and maintaining your edge.

If trader's edge is eroded by bucketshops, 95 % of traders will lose money.The edge of the trader is no more than 5%

I hope this answers your question

O D T

oildaytrader · Oct 24, 2009

shadowninja said:
Tin foil hat at the ready?

I've not had any problems with IG (beyond Java problems meaning sometimes the system would just freeze for hours (irrespective of whether I was in or out of the market). Resolved when the new version was launched. The market plummeted when I last used IG, I am not using guaranteed stop losses... I was slipped for zero pips (ie it took me out at my stop loss and not a pip more... yeah, I was surprised as it was dropping 20 pips per tick).

Alpari slipped me twice for about 20-30 pips in 2008 so I can't complain. Many times it's gone to under a pip near my stoploss and reversed for profit.

Damn those bucket shops.

My agenda is to sell you these bucketshops , so u guys make a living from taxfree.

Taxfree is also available in dutyfee shops , but it is not profit free, and actual Taxes are higher at airports.

I lost 100 points @ 10 per point points at BG index 10 years ago , it took me ten years to realise those damn buketshops robbed me.Thats THICK

0007 · Oct 24, 2009

oildaytrader said:
A skillful trader has an edge over the market , and this edge is normally a few points .
That edge is fictitiously eroded by these bookies operating their own books against the trader.These spreadbetting firms are not like the market, they are trading when the market is closed.EFEECTIVELY THEY ARE NOT THE MARKET.You savings are entirely in the hands of these taxmen/crooked book.

The broker hedging your trade in the market is trading with you and maintaining your edge.

If trader's edge is eroded by bucketshops, 95 % of traders will lose money.The edge of the trader is no more than 5%

I hope this answers your question

O D T

Maybe we're at cross-purposes here: I only trade when the market's open, using an independent price feed - sure, the SB isn't brokering real prices but they are a realistic virtualisation which enables you to make profits. So, no problems with IG - they are just a convenient vehicle for getting money out of the market.

As for an edge - I define mine as having a good long-term probabilty of profitability: "The edge of the trader is no more than 5%" doesn't really have a meaningful application for me - since my results would be the same with a conventional broker (disregarding spreads, commissions etc etc).

I do take your point about closed markets - I think I would be quite wary of trading on "invented" prices.

oildaytrader · Oct 24, 2009

The 5 % edge was derived from studies of mechanical systems tested over many years.Out of a 100 pips daily range range , pro traders are known to look for 5 points daily .The 5 points is the edge.

If bookies run your stops overnight ,and stop is 100 points, trader will need 20 winning trades to breakeven.

oildaytrader · Oct 24, 2009

0007 said:
my results would be the same with a conventional broker (disregarding spreads, commissions etc etc).
.

If a trader has a 5 % edge, but is paying 2 points greater spread with spreadbetting, and 5 points is the expected profit, tax benefit is zero.

Trader saves 40 % on higher rate tax, but ends up paying 40 % more spread = zero gain.

Something to think about.

neil · Oct 24, 2009

shadowninja said:
Tin foil hat at the ready?

I've not had any problems with IG (beyond Java problems meaning sometimes the system would just freeze for hours (irrespective of whether I was in or out of the market). Resolved when the new version was launched. The market plummeted when I last used IG, I am not using guaranteed stop losses... I was slipped for zero pips (ie it took me out at my stop loss and not a pip more... yeah, I was surprised as it was dropping 20 pips per tick).

Alpari slipped me twice for about 20-30 pips in 2008 so I can't complain. Many times it's gone to under a pip near my stoploss and reversed for profit.

Damn those bucket shops.

I have never had problems with IG. Didn't lose out when pound dropped. Takenn out at exact stoploss. Guess it's the losers that whinge

oildaytrader · Oct 24, 2009

neil said:
I have never had problems with IG. Didn't lose out when pound dropped. Takenn out at exact stoploss. Guess it's the losers that whinge

I would say its the pros who whinge , they can see clearly , the amateurs who have nothing to whinge about.The real pros don't hang around forums.:cheesy:

neil · Oct 24, 2009

oildaytrader said:
I would say its the pros who whinge , they can see clearly , the amateurs who have nothing to whinge about.The real pros don't hang around forums.:cheesy:

says a lot about you then Mr. Vendor:cheesy:

oildaytrader · Oct 24, 2009

neil said:
says a lot about you then Mr. Vendor:cheesy:

I wouldn't Whinge if I was on referral fees and all you were being taken to the cleaners.I would argue with anyone who was posting against the bucketshops

O D T

0007 · Oct 24, 2009

oildaytrader said:
I would say its the pros who whinge , they can see clearly , the amateurs who have nothing to whinge about.The real pros don't hang around forums.:cheesy:

Suspect there's more than a grain of truth in that. Pros couldn't run a business on my turnover and probably can't afford time here, but then I can trade as little or as much as i want/need - maybe not an option if you've got a boss to satisfy!

I just wish I'd known about trading for oneself earlier - but thanks Maggie, those Gas shares got me started.

oildaytrader · Oct 24, 2009

0007 said:
I just wish I'd known about trading for oneself earlier - .

Took me 8 years to figure out the ins and outs, today I can consistently make money out of spreadbetting, unfortunately the 2 pip extra spread eats into my profits.I just have to add four more pips to my profit target (two for the extra spread and two for the losing trades = 4)

Jack Hughes · Oct 24, 2009

oildaytrader said:
unfortunately the 2 pip extra spread eats into my profits.I just have to add four more pips to my profit target (two for the extra spread and two for the losing trades = 4)

It's not that simple, though, is it?

zupcon · Oct 24, 2009

Jack Hughes said:
It's not that simple, though, is it?

It was quite amusing though

oildaytrader · Oct 24, 2009

Jack Hughes said:
It's not that simple, though, is it?

Actually it is very simple, just run an A P I with FXCM using my multiple automated strategies and add four extra pips take profit target to existing systems.

The difficult part is writing and testing an A P I that makes 200 % a year. It is already done on metatrader.

Increasing t/p by 4 pips to cover spread isn't enough , add slippages , non fills and the whole thing may not work with bucketshops.Could be very difficult

oildaytrader · Oct 24, 2009

neil said:
I have never had problems with IG. Didn't lose out when pound dropped. Takenn out at exact stoploss. Guess it's the losers that whinge

My losses were through dishonesty of the spreadbetting firm,running a midnight raid on my stop on ftse futures.

Jack Hughes · Oct 24, 2009

oildaytrader said:
My losses were through dishonesty of the spreadbetting firm,running a midnight raid on my stop on ftse futures.

Holding a position overnight on a market that doesn't really exist is asking for trouble.

Black Swan · Oct 25, 2009

Jack Hughes said:
Holding a position overnight on a market that doesn't really exist is asking for trouble.

Really? Strange thing is my charts/open trades don't suddenly go all wacky once the forex market shuts...that's probably because it doesn't really shut Mon- Fri does it? :whistling When the markets open later this evening you'll experience a shift from the Friday close, not difficult to deal with is it?

If SB firms were really stop hunting individual trades then some other clever folk would exploit it...

Spreadbetting bucketshops

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