Best Thread Capital Spreads

paulb said:
Yes, trading the news is risky. What I need if I am trying it is predictability of risk. So I need to know that the platform behaves pretty consistently, and that the messages it gives about trades are accurate. Yes, all platforms I have tried have occasional glitches - maybe they will just freeze for a while, with no activity; I have had this on CMC, and even on IG. My PC is not very new, but I have no way of knowing what is down to my PC and what is down to the platform or to overloaded servers at the SB company.

The problems which stopped me trading the news at all with CS were 1. slow fills, during which time the price may move considerably 2. same problem on trying to exit a trade 3. trade rejected due to "price no longer valid", possibly combined with the delay, meaning it was not possible to take advantage of quick and sizeable price moves. This also could happen on trying to exit a trade. 4. the problem others have recently mentioned, of a trade apparently being rejected, not appearing in "open positions", but then popping up later in "open positions"

For me to risk trying trading the news again on CS, I need to know that all these problems have been consistently fixed. You say that there has been an improvement since a recent upgrade - maybe I will try a trade or two at non-news times and see what the fill speed is like.

But I have to say IG fills very fast. True, I have occasionally had "price no longer valid" - but it is fairly rare compared to what I used to get way back with CS.

I rated CMC fairly highly at first, but one bad experience made me wary there too. They do generally fill fast, they give you a requote if not filled at original price, and sometimes while your order is pending you can cancel it (not always - depends how fast they fill). But when I was trading oil after the Weds. 1530 inventory announcement a few weeks back, there seemed to be a delay on their prices. I opened a trade and then found that I could not close it - even when they offered me a requote and I pressed to accept it, they said I had timed out. They did refund me some money when I raised the issue, but without getting to the bottom of what caused the problem. Unlike IG, CMC and CS do not allow you to preset a stop when you open a trade, and unlike CS they do not set their own stop for you (admittedly at a rather distant level for me), so there is no limit to the short-term loss if this sort of error occurs.

I have decided that CS platform scores in one respect; it is possible to open the order book in one broswer window, the prices page in another so as to open a deal ticket for a new trade, and the open positions in a third window to close existing trades. In fact I find the platform unusable at speed without having all these windows open. I used to think this a disadvantage of the platform; but on IG, if you want to change your stop level, you have to close the deal ticket which allows you to close the trade. So if trading in a fast moving market, you can find that while you are moving your stop closer to take advantage of your gains, the price turns against you, and by the time you have closed the "change stop" window and opend the deal ticket to close the trade, your profits may have gone. Whereas with separate windows in CS, resized so all can be viewed simultaneously, this is not a problem.

To those who say "don't spreadbet at all, use some other way", my response is that I - and presumably others - have reasons for using SB. Given that, the question is what we can legitimately expect. I don't think all SB companies are just rip-off merchants, but obviously they are running a busines and are not going to give away free money.

What I do expect is that mistakes are rectified - they often have been for me, but not always. I find CS no better or worse than others in this respect.

What I also expect is a decent platform that works at reasonable speed without repeating the same errors on a regular basis - and, ideally that the platform incoprorates good features from competitors.
Click to expand...
I can only say, it might pay to give CS a try again, to see if things have changed. A great report, thanks.
 
I have been using CS for a little while now and their stated prices are in line with other spread betting co's. I have had CS, IG and CMC all runing at the same time to see if there is a different in prices but for a point or 2 they were the same, even in fast moving markets.

I have never had any trouble getting a trade on in a fast moving market, the only problem I have had is a freeze on the screen or losing front end processor and having to open in a new window. I will have to what OLD are like but 6 point spread out of hours is huge. 1 point in ftse trading hours and 4 points outside hours is not bad, but I would love a SB company to come out with a 2 point spread after hours for the ftse. On the Dax CS have a 2 point spread until 9pm which is good. I would like to be able to trade ftse 24hrs monday to friday or CS keep the ftse open until 9.30pm to take take advantage of the dows after hours trades which can affect the ftse price.
 
Potshot,

"there is a different in prices but for a point or 2 they were the same."

Not that surprising. I would bet all SB's monitor competitor's prices to avoid potential arbitrages; to avoid offering the worst prices (not necessarily the best).

Or maybe it's a cartel with price fixing.

Grant.
 
Simon,

I’m noticing that an increasing number of ‘trade attempts’ are falling outside of the boundaries which you have clearly laid out on these boards.

Previously you have stated that orders will be filled so long as the price contained in the order remains inside the quote showing on your system at the time that your dealer gets my order. I am finding that you are now repeatedly and consistently breaching your clearly specified criteria.

I will provide examples. This morning I attempted to close an overnight short position on FTSE for 2 contracts (ie £20). The quote on your system was showing 6050 – 6054. I entered orders for a buy to close at 6054...... short delay.... “Order Refused – The Price Is No Longer Valid”..... price is then moved to 6052 – 6056. This move in price clearly occurred between 5 and 10 seconds after my attempt to close. According to your order acceptance criteria my order should still have been accepted?? My attempt to buy was at 6054 and the quote is now 6052 – 6056.....6054 clearly falls inside the current quotation and thus, according to your publicly acknowledged rules, the trade should have been accepted. In the end I closed on the next attempt at 6056 which is clearly 2 points worse off thus you saved yourselves £40.

Next attempt to buy another 2 contracts was at around 7.40am. Quote was 6058 – 6062. I entered orders to buy at 6062. Again “Trade Refused – Price Is No Longer Valid”. Quote moves to 6060 – 6064. Again 6062 falls well inside the current quotation and again should have been accepted according to your publicly stated dealing rules. A few moments later the quote drops back to 6058 – 6062!

These don’t seem isolated events. I had a friend with me in the office this morning who also has an account. On the second failed trade we were monitoring the quotation on his account whilst I was waiting for the outcome of my attempt to trade on mine. Your quotation only appeared to edge higher once my attempt to trade had been sent. His comment at the time was, “They’ve only moved the price higher because you are trying to buy”. His suggestion is that you use certain clients (placed on manual dealing) as a proxy for setting your prices?

Regardless of whether you ‘use clients’ to set your prices or not, you are not keeping to what you have previously stated in this thread with regard to fair execution ie the attempt to trade falling within the spread at the time the dealer reviews the trade.

Steve.
 
Last edited:
Steve: Don't you think they can always claim that this sort of situation is caused by delays in 'the system', which covers just about everything?
 
Phil Mibbutz said:
Steve: Don't you think they can always claim that this sort of situation is caused by delays in 'the system', which covers just about everything?
Click to expand...

No, because with all things considered the price contained in my trade order still fell bang inside the 'current quote' even if they were using my attempt to trade to modify their price.

Steve.
 
stevespray said:
These don’t seem isolated events. I had a friend with me in the office this morning who also has an account. On the second failed trade we were monitoring the quotation on his account whilst I was waiting for the outcome of my attempt to trade on mine. Your quotation only appeared to edge higher once my attempt to trade had been sent. His comment at the time was, “They’ve only moved the price higher because you are trying to buy”. His suggestion is that you use certain clients (placed on manual dealing) as a proxy for setting your prices?

Steve.
Click to expand...

Well if you want to capture & record this in realtime, windows encoder 9 series will do the job. You can record partial windows or entire desktops for video playback/recording.

Traders could also use this to record a trading session and put it to disk.

Its free !

Windows Media Encoder
 
Crap Buddist said:
Well if you want to capture & record this in realtime, windows encoder 9 series will do the job. You can record partial windows or entire desktops for video playback/recording.

Traders could also use this to record a trading session and put it to disk.

Its free !

Windows Media Encoder
Click to expand...

Worth a try, but another SB still wasn't impressed a few years ago when I sent them a screenshot proving that something they said was impossible actually happened!
Anyway, we wait with bated breath for CS's 'it's always the same people who complain...' response to Steve. 🙂
 
stevespray said:
Simon,

I’m noticing that an increasing number of ‘trade attempts’ are falling outside of the boundaries which you have clearly laid out on these boards.

Previously you have stated that orders will be filled so long as the price contained in the order remains inside the quote showing on your system at the time that your dealer gets my order. I am finding that you are now repeatedly and consistently breaching your clearly specified criteria.

I will provide examples. This morning I attempted to close an overnight short position on FTSE for 2 contracts (ie £20). The quote on your system was showing 6050 – 6054. I entered orders for a buy to close at 6054...... short delay.... “Order Refused – The Price Is No Longer Valid”..... price is then moved to 6052 – 6056. This move in price clearly occurred between 5 and 10 seconds after my attempt to close. According to your order acceptance criteria my order should still have been accepted?? My attempt to buy was at 6054 and the quote is now 6052 – 6056.....6054 clearly falls inside the current quotation and thus, according to your publicly acknowledged rules, the trade should have been accepted. In the end I closed on the next attempt at 6056 which is clearly 2 points worse off thus you saved yourselves £40.

Next attempt to buy another 2 contracts was at around 7.40am. Quote was 6058 – 6062. I entered orders to buy at 6062. Again “Trade Refused – Price Is No Longer Valid”. Quote moves to 6060 – 6064. Again 6062 falls well inside the current quotation and again should have been accepted according to your publicly stated dealing rules. A few moments later the quote drops back to 6058 – 6062!

These don’t seem isolated events. I had a friend with me in the office this morning who also has an account. On the second failed trade we were monitoring the quotation on his account whilst I was waiting for the outcome of my attempt to trade on mine. Your quotation only appeared to edge higher once my attempt to trade had been sent. His comment at the time was, “They’ve only moved the price higher because you are trying to buy”. His suggestion is that you use certain clients (placed on manual dealing) as a proxy for setting your prices?

Regardless of whether you ‘use clients’ to set your prices or not, you are not keeping to what you have previously stated in this thread with regard to fair execution ie the attempt to trade falling within the spread at the time the dealer reviews the trade.

Steve.
Click to expand...
This is tricky Steve, you are trading off hours, so there is no actual movement on the real market. It is absolutely essential that you record the session as suggested by Crap Buddist. Record your friends' quote at the same time. Afterwards compare both against the recorded live feed of the futures that you have. I don't know how many times I have recorded a session, only to find out that the SB was not to blame. I don't mean to say that they haven't monitored the trade against you in this case. Remember that the SB does not know anymore than we do, about the way the market is heading. However, If the recording shows that you and your friend have quotes that differ, they are clearly not following the MiFID "Best execution" directive. A few have claimed this to be so, but so far no one on this thread has been able to prove it convincingly enough.
 
Phil,

"another SB still wasn't impressed a few years ago when I sent them a screenshot proving that something they said was impossible actually happened!"

So how did they respond to irrrefutable evidence?

Gle,

Re "MiFID "Best execution" directive". I can't see this being relevant seeing as there is only one price, ie the SB's price. I think the directive applies when there are numerous prices on the same instrument, eg different exchanges, multiple market-makers.

Grant.
 
gle101 said:
This is tricky Steve, you are trading off hours, so there is no actual movement on the real market. It is absolutely essential that you record the session as suggested by Crap Buddist. Record your friends' quote at the same time. Afterwards compare both against the recorded live feed of the futures that you have. I don't know how many times I have recorded a session, only to find out that the SB was not to blame. I don't mean to say that they haven't monitored the trade against you in this case. Remember that the SB does not know anymore than we do, about the way the market is heading. However, If the recording shows that you and your friend have quotes that differ, they are clearly not following the MiFID "Best execution" directive. A few have claimed this to be so, but so far no one on this thread has been able to prove it convincingly enough.
Click to expand...

Gle,

You are right, it is trading out of hours but CS charge an extra spread to cover this aspect. I’m not sure whether MiFID directives cover this kind of thing or is indeed applicable. As Grant mentioned there is only one ‘quote’ as such and this is the one provided by CS, in real time, via their platform or via the telephone.

Obviously ‘out of hours’ markets are hard to price correctly. Recently I’ve seen Finspreads quotes on FTSE and DAX (1 minute before the open) be 20 or 30 points away from the first print on the underlying when it officially opens. This is an inherent danger of market making out of hours – if there is someone out there who is better than you are then they will make money from you and, since you cannot hedge it off, a client’s financial gain is a firm’s loss. In my opinion it is possible to establish a very healthy living purely trading in this premarket period.

My feeling is that recently my number of rejections has gone up because CS dealers consider their quotation after they know my (or indeed other clients) instructions. Surely fairness dictates that a client would be filled if he or she submits (and the firm receives) the order BEFORE the price changes? This isn’t happening. Instead the firm seem to view and instruction to buy or sell as a prompt to, a ) stall the filling of the order, followed by b ) moving the price in the direction of the order, followed by c ) issuing a ‘Trade Rejection’ notice based on a price which the dealing staff have just moved because you placed an order. Therefore it’s much harder to get filled and the quotes mean very little.

Of course, to stay inside the criteria which Simon appears to have set out, the quote would still have to move more than 4 points for the price to become invalid. So as well as moving the prices based on individual clients orders the dealing staff also seem to ignore the test for ‘price validity’ which has been publically set out.

Just to clarify re my friends account; I was not implying that different prices were showing on the two different accounts – I want to make that clear. All that the second account was used for was to monitor the price of their market in real time after my trade was sent. In other words I could see that the price didn’t alter the split second that I sent my order. The price remained the same for between five and ten seconds after my order was sent. It was only after that time period that the price was moved higher and then, at that point, my order was rejected on the grounds of invalid price. I therefore suspect (who is that behind the grassy knowle?!?) that the firm may, from time to time, delay the filling of a clients order in order to move the price.

I don't want to make a huge issue out of this but I'm just pointing out that things aren't happening as they are suggested by Simon.

Steve.
 
steve

in pre market FTSE we try to give as good a price as we can but the only real information open to us is the pre-market orders put into the LIFFE futures markets. (and some premarket orders on a few FTSE 100 shares) As some traders reading this are no doubt aware, anyone can put a premarket order in the DMA system which will not be filled (as the market is not actaully open) but which will affect the average 'opening cross level'. So you (anyone) can put a 500 lot (£5000 bet equivalent) order to sell at 100 points below the market at 07.58 and this will (obviously) affect the average crossing price for the open. Our systems are not linked to this 'opening cross' as it is rather open to manipulation but our dealers must take note of it.

If the cross is looking to come in 20 higher but then a big order comes in which moves the average down to just 10 up then our dealers must 'estimate' whether this is a real order or just somebody trying to 'spook' the market in the minutes before the real open.

Sometimes traders play 'spoof' on the open (I often wonder whether it is an attempt to get the SB firms to adjust their pre-open quotes). I once saw a dealer lose over £70K when he placed a spooking order on a pre-market system and then he got distracted just before the open. He was filled at bang on 8.00 some 50 points away from the real level in huge size. A difficult conversation with his treasury manager ensued.

This morning was a case in point where we were merrily quoting 6054-6058 or thereabouts for most of the 07.00 to 08.00 period. The cross actually came in at 6070, for some reason. 16 pips higher. A minute or so later it was back at 6054. why? who knows?

My dealers are only human... in hours, £20 would go through without a blink on a one point spread. Pre-market, on a four point spread they, naturally, wonder why is somebody trading in £20 and automatically think "oh! our price must be wrong". If they then see than a big pre-market order has gone on the LIFFE system they will then assess the attempted trade. Out of hours quoting and trading is filled with fear. My dealers do not want to be seen to have been caught out when they should have been more vigilent.

Pre-market has no underlying instrument so it is the only time when a deal request is 'completely' a request to trade at a price and is entirely at the dealers discretion whether to accept or not. Out of hours markets are never auto accept ...even a £1 bet will go to a trader for verification.

On the other hand you are quite right about trading just before the open, some people seem to have a sixth sense about opening levels. We have some clients who only ever trade in the few minutes before the open and ignore the market for the rest of the day.

Simon
 
capitalspreads said:
steve

Pre-market has no underlying instrument so it is the only time when a deal request is 'completely' a request to trade at a price and is entirely at the dealers discretion whether to accept or not. Out of hours markets are never auto accept ...even a £1 bet will go to a trader for verification.
Click to expand...

Sorry, this is just bull. From a client's point of view, it's the same intsrument whether in or out of hours. Perhaps you could point to the place in your t&cs where it specifies that until the market is open, a trade is only a request. On your products where there is no underlying market (FX, binaries) can we assume that you these deal requests as a 'request to deal' as well?

I don't often agree with Steve, but here you really are having your cake and eating it, claiming on the one hand that your dealers can't know where the opening will be with 10 points, and on the other that Steve's trades are rejected so that your dealers can finesse the price 2 pips. Frankly, it's pretty obvious that they just fancied another £40 for the privilege of trading.

Nick
 
ns1000 said:
Sorry, this is just bull. From a client's point of view, it's the same intsrument whether in or out of hours. Perhaps you could point to the place in your t&cs where it specifies that until the market is open, a trade is only a request. On your products where there is no underlying market (FX, binaries) can we assume that you these deal requests as a 'request to deal' as well?

I don't often agree with Steve, but here you really are having your cake and eating it, claiming on the one hand that your dealers can't know where the opening will be with 10 points, and on the other that Steve's trades are rejected so that your dealers can finesse the price 2 pips. Frankly, it's pretty obvious that they just fancied another £40 for the privilege of trading.

Nick
Click to expand...

Yes but there is no hedge when the market is pre-open, is there.
 
gooseman said:
Yes but there is no hedge when the market is pre-open, is there.
Click to expand...

Two points - firstly, whether or not there is a hedge is a matter for the firm, not the customer. The product he is offering is identical according to his t&cs irrespective of the time.

Secondly, there is no identical hedge for a self-generated index product. During hours FTSE Cash can be hedged pretty effectively with FTSE futures, but nonetheless there is some risk from a shift in fair value. Out of hours, most SBs will hedge in other futures markets, generally the S&P. There is a strong corellation between the US and UK indices - overnight, this is what the price is generally based on (plus client trades, and other firms' pricing). A distinction can be made between pricing and hedging. Yes, there's no means of pricing perfectly (no underlying), but there are means to hedge exposure based on the relative betas of markets.

It's makes no difference to the trader though however the book is hedged.
 
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