Best Thread Capital Spreads

[marketmakers]

Anyone reading this stay away from capital Spreads had problems closing trades, a real punch in the stomach. Staffing problems at the moment, but they have tight spreads which is an advantage. Currently using finspreads, ig idex andm cmc would higly recommend one of these.

Marketmakers

 

[stevespray]

Simon / Others ......

I think I've mentioned this before but as with most threads which deal with this sort of thing the same finite subject detail crops up in a recuring cycle. Again we are back to execution of orders and the timings which relate to such executions. The problem which seems to come up most is the rejected trade based on price movements after an order has been given. The only company where I can say that this doesnt happen is Finspreads where you do genuinely get the price which they are quoting at the time. IG Index claim that the price you see is the price you get and that all prices are live and tradable but alas this isn't the service you always receive. It seems that Capital also take some stick on a similar point when customers are told 'the price is no longer valid' or words to that effect. The fact is that a customer can only submit a market order at the current prevailing quote. After the order is submitted the customer has no control over how long it takes the dealer to deal with that particular order. This presents a serious imbalance which is to the detriment of the customer if dealers are then at liberty to except or reject orders based on the price of the market at the time he reviews the order rather than the price of the market when the order was submitted. This could become a problem when news items (such as data / fed / other market moving news) hits the markets as they can move quite quickly in a very short space of time. If you study volumes at those times it is clear that they increase massively. This huge increase is obviosuly due to many people trading at the same time. On that basis it is likely that many spreadbetting punters will want to trade in large numbers at that time also which now presents such companies with a problem. If deals are done on a manual basis then it is very likely that a large queue of backlogged orders could form. This backlog obviously leads to orders taking longer than normal to be processed. In this time period it possible that the market may have moved some distance from the level that it was at when the initial order was placed. Is it therefore fair to reject an order based on such movement as the delay is beyond the control of the customer ? In my recent disagreement with IG Index they held me around 40 seconds (for no real reason, it was about 8.55am) before rejecting my order to close a rather healthy looking down bet on the dow. The reason given to me was that "our order book moved while you order was waiting to be dealt with". I've obviosuly taken the matter to the Financial Ombudsman to see what they have to say but so far as I can see its a clear case of a company benefiting by a delay in the execution of an instruction. Interestingly I have never found that I have had an order rejected when the price has gone on to favour me after the delay.

In time (hopefully very very soon) these issues will have to be addressed by the authorities which regulate the spreadbetting industry. For companies to be able to queue and reject orders in that way is totally unaceptable and leaves the punter at a huge disadvantage in anykind of market be it fast or slow.

Steve.

 

[hagadol]

Quoting Simon: "..........but if you have the trade ticket open the delay should only be a second or two.:

Please confirm that the open ticket price is quicker than the web page.



SImon

Thanks for the response, though I still cannot understand why your price always lags the price on my chart when my trade is moving in positive direction (from my point of view). This is always every trade, when I am up.

Though when the market is moving against me, suddenly your price is always, at least, as few ticks ahead. This is always, every trade, when I am down

This morning (Friday 20th May) at around 10am on Cable: The pound fell to approx 1.7635 with FXCM and CMC, though your price never went approx below 1.7657. 22 ticks behind. I cannot imagine that if the price goes against the client, that your price will lag by this amount. Very worrying, since I have to also compete against the market and the spread. How can I be profitable ?

Even if I am looking at the traded price with FXCM and the bid/ ask with you, does this account for 22 ticks ? I doubt it.

 

[stevespray]

Hagadol - Are you sure you are comparing the same instruments ? 22 ticks is a hell of big difference. If you are sure the next time it occurs trade it as an arb and lay the other half off with someone else, all you have to do is to wait for it to come back into line then close both sides. Personally I think 22 points indicates that some is talking at cross purposes or comparing slightly differing instruments.
I'm interested to find out which ?

Steve.

 

[Uncle]

Stevespray..........I observe you are fond of the prices at Finspreads..........what you failed to say is how they repeatedly trigger a stop loss even the though the price hasnt hit. I have closed my account with them as a consequence!!!

John

 

[capitalspreads]

I am not sure what market makers point is. If customers really had problems in closing positions I would assume that they would be very vocal on this very chat site. I and my colleagues have worked for all the major SB companies and we can assure you that the level of complaints with our trading platform and our client service is miniscule compared to them.

We quote tighter prices than all those mentioned and the only delay in trading our platform is in our activation of Stops. This is because we cannot be sure that every price we get from the markets is true and fair. For instance yesterday in the Brent Crude oil there was a mis print on the feeds of 35.50 instead of 36.50 this activated all our stops but because we have a human checking stops we ignored them. There is also the perennial problem in illiquid 250 stocks, sometimes the bid /offer in the real market is very wide and if we just accepted these wide prices as ok to take out stops we could really be accused of unfair practices. Also if there is a delay in activating your stop you have the chance to
a) trade at a better price (if you know your stop has been hit but the market has move back again in the subsequent seconds) thus possibly saving you a few pips. every little bit helps.
or b) moving your stop further away (if you are quick)

if the stop is fair it will have been activated in any case so whether we process it immediately or in a minute or two is academic.

The low print on the FX GBP today was apparently 1.7635 but the prints went 1.7648-35-48 on our bloomberg ticker all in the same second at 08:00:26 this means that unless one of the banks that we use as our quote feeds reflected this outprint we would not have quoted it online. And indeed our price may have remained around the 1.7650 mark for the period. I havn't the time to analyse the quotes from every single bank just the ones that we use and their offer never went below 1.7650 so our lowest quote would have been 45-50 (amongst others we use Barclays, UBS, Dresdner and several brokers including CMC)
I would suggest that if you see firm offers at arbable prices you should try to trade on them !

For further comments on prices moving immediately against you please read the previous posting particularly the part relating to biasing.

And this final point is made in answer to all of the queries about why cant you trade on the price as you see it................ In the real world Futures, commodities anything that is exchange traded etc... if the price moves as you try to trade you WILL NOT get the fill no matter how much you huff and puff about it. Why should the SB companies be any different ? In general the only prices that the SB companies are not firm on are the spot/daily FX prices for the reasons that I have mentioned many times allready. In fact I notice that Finspreads and Cantors do not even quote daily FX online (probably because of the problems that it generates)

Good trading today !

Simon

 

[hagadol]

Simon.

Thanks for your good explanation, I appreciate that.

The two issues, you have not addressed directly, that I would like some understanding of is:

1. When ther price goes positive for me Capital Spreads always is behind, as discussed above. Though when it goes against me your price always is ahead (in that direction). If this is not some sort of bias, what is it ? Everytime, all trades. So I usually am behind the market going with me, though tend to get stopped out a few ticks ahead of the price in the other direction. Surely the relationship between your price and the market should be the same in both directions.

2. When I enter a trade on the site and there is a few seconds delay, if the priced goes against me you put me in, if for me, I am told it cannot. Even in the case of the price being within the original spread.

Please answer directly.

Ha Gadol

 

[capitalspreads]

Hi all

I am getting alot of enquiries about stop levels.

Sometimes we have accidentaly set minimum stop levels too far away. Especially on equities. If you are trading in an instrument and it will not allow you to place a stop as close as you wish please just call us 0207 600 0110 and we will amend the minimum limit level.

Simon

 

[kevin546]

SteveSpray

A very interesting post on the matter of order execution time by spreadbetting companies. Such an issue is mainly of significance to day traders although delays and less favourable prices will obviously reflect a lower profit margin even for position or swing traders. In your experience have you found a spreadbetting company that does provide swift order fills for the vast majority of the orders placed.

I have not used CityIndex since they moved online but never had a problem with phone orders. I still use CMC and find I have absolutely no problem if I trade at or below £25 a point on the FTSE cash. Above this they never refuse an order but there will be delays and a re-quote. I have come to accept trading at £25 a point for my day trading.

I was under the impression that when CapitalSpreads first started they claimed such problems would not affect them but I see the issue of execution has been raised again. Is there a trader here that can confirm they do not have such problems with Capitalspreads when day trading where fast orders are essential.

Kevin

 

[kevin546]

Hagadol

I note your previous bias price question concerning CapitalSpreads. I have not traded through them so cannot comment however as another has already stated the cash deals always follow the futures price and is set a given amount from it. Some companies may at certain times during an intraday trend change this distance so where your deal has moved positive it can suddenly change or have less in your favour as the company move there price further from the futures price. You can be left feeling the price has got to do it all over again for you I have noticed this particularly with the DOW cash so I dont trade it.

As for a general bias the best way to deal intraday with spreadbetting prices is to trade from there own price chart if reliable. That way you continue to trade according to there price rather than the market price and do not get caught out so often. If the company you currently use does not have this facility then you have to consider a position or swing trading strategy that provides lower risk trading otherwise move to direct access or a spreadbetting company that does have reliable price charts in real time.

Kevin

 

[SBM]

Wall street

How is it that on capital spreads you can trade wall street from 7:10-21:00, yet on tradindex its hours of trading are 8:15 to 21:00?

Also, how come the closing prices are different by 30 points?

 

[Uncle]

Kevin............yes I use Capital Spreads and have not so far found any problems with the platform or prices quoted.

John

 

[capitalspreads]

SBM

the Wall Street Cash is traded against the Mini Dow Futures which is open almost 24 hours a day. We quote from 07.01 as that is when we open in the morning. If there was really a difference of 30 points on the wall street daily cash I would trade on it !!
I think that maybe there was either some error somewhere or you were perhaps looking at different products.

Bias.... we dont , we dont have time, please check our markets vs the futures in indices and commodities and against spot in Shares and FX ...our prices will consistently follow the liquid market that they are assigned against. Please dont look at your DOW cash feed and expect the quote to be consistent around that.

Simon

 

[dc2000]

Simon
Are you saying that the live futures price will always represent the middle of your spread and can not be moved to either end of the spread ?

I do not see any maximum £ per point on your indices I assume it will be inline with the other SBs. with this in mind has your company ever asked a customer to telephone trade only orders over £70 per point on indices ?

 

[bracke]

capitalspreads

Can you explain the net + or - figure that you show against a price

Example 24/5/04 dow closed at 9958

25/05/04 you were showing dow cash mid price at 9933 with net change -53.

This would mean that the dow closed at 9986 ( 9933 + 53) which is incorrect.

Regards

bracke

 

[kevin546]

Uncle

Thank you for your response. Would you be kind enough to confirm roughly over what number of trades you have experienced the good performance, what deal size you are generally trading at and are these deals day trades.

Kevin

 

[Uncle]

Kevin I do not disclose the info you seek publicly, other than to say they are profitable and yes the deals on the Dow are day trades.

Sorry i cannot be more precise, but then as a Trader you will know why the reluctance to disclose too much.



John

 

[a320]

Simon
Are you saying that the live futures price will always represent the middle of your spread and can not be moved to either end of the spread ?

Great question dc..I'd like to know the answer as well .
I'm a direct access trader myself with only limited experience of SB.

CJ

 

[kevin546]

Uncle

Thank you for responding and I fully appreciate your position.

Kevin

 

[stevespray]

Kevin546… Re your question to me from yesterday…..In a word yes, Finspreads very rarely refuse an order that you click on the screen. On the odd occasion that an order isn’t filled its normally because of a system fault rather than dealer intervention. Normally a phone call quickly rectifies the situation. I think its fair to say that Finspreads honour the prices which they quote once you have entered your stake and you have the buy/sell box on screen.

You are correct in your observations regarding order conformations, it is far more important for day traders than for swing / position traders – its just that the nature of the day trader requires a fast and efficient process of execution. My own personal view is that the different companies will note how effectively you trade and that can determine what kind of service you receive. If you day-trade effectively then you will often upset the spreadbetting companies, I know companies will argue but that is my experience and therefore my view. My ongoing dispute with IG Index is evidence of that. IG are happy to send out advertising literature stating that ‘prices are always live and tradable’ and that ‘the price you see is the price you get’ – this is in order to attract customers to their platform. However, as you become a better trader and win money in a shorter timeframe you may start to get treated differently. In my case it reached a point where orders were taking almost a minute to get processed and orders were being refused based on price movements within that time. This clearly isn’t the service that they clearly advertise and nor is it what the terms and conditions say will happen to your order once it is received.

Just going back to speed of execution – Obviously companies that claim to lay off positions of customers the moment they open them require a certain amount of time to be able to do this, if you attempt to trade around data or news items which make the market move quickly then it becomes much harder for them to lay positions off. To be honest I actually have my doubts as to the amount of positions that the various spreadbetting companies lay off. If it is true that 90%+ of short term traders fail then why is there a need to lay off these positions ? Also, where are the earnings of these companies coming from if they only manage to nibble a point or so of each customer on trades in Dow / FTSE / Dax etc ? There just doesn’t seem to be enough profit in it for the spreadbetting company when you consider all their overheads (offices / staff wages / data feeds / software + internet / business rates for central London), it seems to me that most, if not all, of the companies are banking on customers losing overall on a day to day basis.

Wishes,
Steve.