Best Thread Capital Spreads

[gle101]

wow

i went off line for a few days and 12 pages of comment. Basically people chatting between themselves so no real input needed from me.

The process of trying to improve systems whilst at the same time having to keep the existing platforms running is not as simple as everyone might think

The LSE managed to fall over yesterday at 15.04 (in a huge number of stocks) and failed to come up for trading again before the close. They have vast resourses compared to LCG and still could not solve an issue within 90 minutes

IG have very fine systems but they still quote wider prices than CS on nearly every market. The problem with stating that nobody should operate until they are at least as good as the best would mean that, eventually, you would end up with just one or two companies. At the moment there are some 10 SB companies around and you can pick or choose between them at your leisure. They each have their individual advantages and disadvantages.

On dealer intervention I am afraid that we will just have to agree to disagree. The SB companies take their view and scalpers have theirs. Let me emphasis that there is nothing wrong in trying to scalp on latency issues but on the other hand there should likewise be nothing wrong with SB companies trying to prevent it.

On spiking price moves…. If a price move actually happens then orders (take profit or stop losses) will be executed. If a spike is caused by ‘Fat Finger’ on the exchanges and trades are subsequently deleted ‘by the exchange’ then CS will respond in exactly the same way. (there was a case last week on the US Dollar Index for anyone interested when the exchange suddenly shot up to over 82.000 in a minute (and stayed quite high for a couple of minutes). We executed the orders as per our quote but later in the day the exchange ‘busted’ all trades over 77.500. All stops above this price were reinstated with our clients and all slippage (as there was quite a bit) reversed back to 77.500.

If anyone goes ‘stop hunting’ after 21.00 (I assume he means in the FTSE and Dax ‘out of hours’ markets) or is suspected of doing so then this should be reported to the FSA/FOS. All our prices are referenced to the underlying ‘world markets’ and our competitor quotes.

The problem with somebody ‘stop hunting’ is that if they move the price unreasonably high, or low, then clients will just trade against you. In trying to reach a stop you are more likely to attract more trades from Clients recognising that your quote has gone too far.

I can guarantee that CS does not do this.

There have been moments when i have seen huge stops from clients just a pip away ….. only for the market to sway the other way.. we do not really watch the stop book anyway as we are only interested when they are executed (our screens show then as ‘red lined’ for activation) .. I am sure that some of the readers of this thread might admit to trades where their stops have been saved by a pip or two and turned round into a profit.

Once again I would like to mention that any client is welcome to come and visit our offices to see how every thing really does work. Rather than take too much notice of all the conspiracy theories out there.

Simon

Simon, network latency is not a major problem for the industry today, please do not speak for the entire industry. Volatility might be, but that is another issue. As I said before, it amounts for a very small fractions of all trades. How do I know this, by comparing your price feed with the futures for a period of 4 years, the last few years, with CS no problem at all (seen from the SB point of view). The real market take care of it in an natural way, you don't. Why don't you give a re-quote or your infamous 'price no longer valid' message if your price feed is not up to standard? No need for categorizing clients (not allowed anyway), freezing and letting orders pending in the air for no apparent reason at all. Simon, you are not honest about the issue, how can an industry like this mature with this kind of attitude. Come out up front with he real problem, traders are not your enemies, they are your clients, who you are making a darn good living at. Traders notice all kinds of problems with CS platform, and you are going about it like it is raining. These traders are not the ones that are trading on network latency, but average joe's who feel insecure trading with you.

 

[brendansvest]

Here here......

 

[top trader]

the freezing on friday happened to a group of clients on one of our FEP's where the number of clients being apportioned to that FEP went over a certain number, freezing the FEP. When we closed that FEP down it immediately swamped the next one. We have analysed the problem and believe that we have found and implemented a solution. touch wood.

widening the spread would just annoy the thousands of clients who were not having a problem.

My login had no issue at all and it took some time (18 minutes) for us to find out what the problem actually was and then adjust for it. As mentioned previously offering a live online platform is an education in itself. What you believe is working beautifully one day will be building up a problem somewhere else and vice versa.

In one case, quite a while ago, we had solved a very real point of constriction costing us a large sum of development money only to discover that in solving the bottleneck at one point led to bottlenecks elsewhere as the increased speed of data overwhelmed other areas

simon
Simon

Thank you for your reply.

Freezing happens Most of the time when USA figures come out , not as you said on FRIDAY. It happened before many times.

As far as Capital is concern you might say you need to hedge your positions which you can't do it when the market is volatile. Therefore I suggested a wider spread during that time, IF necessary.

 

[gle101]

Thank you for your reply.

Freezing happens Most of the time when USA figures come out , not as you said on FRIDAY. It happened before many times.

As far as Capital is concern you might say you need to hedge your positions which you can't do it when the market is volatile. Therefore I suggested a wider spread during that time, IF necessary.

Yes, I think a variable spread is the future of SB. Clients will not put up with this kind of disturbance in the long run trading the "markets".

 

[Jack Hughes]

Yes, I think a variable spread is the future of SB. Clients will not put up with this kind of disturbance in the long run trading the "markets".

Let's hope you're right, then half of them will go out of business and we'll be able to get low commission futures accounts.

 

[top trader]

Let's hope you're right, then half of them will go out of business and we'll be able to get low commission futures accounts.

Over 90% s/b traders loose their money, eventually ( They alway win ).
Think why do they give up to £100 to open an account.

 

[Jack Hughes]

Over 90% s/b traders loose their money, eventually ( They alway win ).
Think why do they give up to £100 to open an account.

Firstly, as you say, because most SB-ers lose, and secondly because the £100 doesn't really exist.

 

[capitalspreads]

it would be lovely if everyone could trade direct access in all the markets that SB companies supply (for free). Access to DMA on futures etc generally costs money... margins on equity, commodities, indices etc are enormous compared to SB offerings and (the real killer) the size of most contracts puts them out of reach of many clients.

The Dax contract is the equivalent of a £22 bet and the initial margin required by brokers is over €15,000. (a far cry from our £1 and £50 pound minimum margin requirement)

GLE
my comments here are in the line of information, explanation and assistance. I can assure you that when problems occur we are not just 'singing in the rain'. We scream blue murder at our IT teams as, I can assure you, the thing that really, really upsets my dealers, customer services staff and me is unhappy clients.

When a problem raises its head (and each new problem seems to arise out of nowhere) we move mountains trying to solve the issues.

Simon

 

[tar]

it would be lovely if everyone could trade direct access in all the markets that SB companies supply (for free). Access to DMA on futures etc generally costs money... margins on equity, commodities, indices etc are enormous compared to SB offerings and (the real killer) the size of most contracts puts them out of reach of many clients.

The Dax contract is the equivalent of a £22 bet and the initial margin required by brokers is over €15,000.

GLE
my comments here are in the line of information, explanation and assistance. I can assure you that when problems occur we are not just 'singing in the rain'. We scream blue murder at our IT teams as, I can assure you, the thing that really, really upsets my dealers, customer services staff and me is unhappy clients.

When a problem raises its head (and each new problem seems to arise out of nowhere) we move mountains trying to solve the issues.

Simon

I guess when CS loses clients and money u will change

 

[wrighsz]

Simon,

why do you (or any other SB companies) not allow clients access to your data to run automated backtests ?

I personally get a subscription to eSignal to do this, but (a) thats an additional cost and (b) its results are not the same as those of SBs due to spreads/sources/price engine etc.

Its frustrating and seems to be a hole in the market.

 

[tar]

Simon,

why do you (or any other SB companies) not allow clients access to your data to run automated backtests ?

I personally get a subscription to eSignal to do this, but (a) thats an additional cost and (b) its results are not the same as those of SBs due to spreads/sources/price engine etc.

Its frustrating and seems to be a hole in the market.

I think u can make backtests with IGindex advanced charts ...

 

[Black Swan]

Hi Simon, could you check your pm's and get back to me?
Thanks

 

[Jack Hughes]

I think u can make backtests with IGindex advanced charts ...

And ETX, I think.

 

[gle101]

it would be lovely if everyone could trade direct access in all the markets that SB companies supply (for free). Access to DMA on futures etc generally costs money... margins on equity, commodities, indices etc are enormous compared to SB offerings and (the real killer) the size of most contracts puts them out of reach of many clients.

The Dax contract is the equivalent of a £22 bet and the initial margin required by brokers is over €15,000. (a far cry from our £1 and £50 pound minimum margin requirement)

GLE
my comments here are in the line of information, explanation and assistance. I can assure you that when problems occur we are not just 'singing in the rain'. We scream blue murder at our IT teams as, I can assure you, the thing that really, really upsets my dealers, customer services staff and me is unhappy clients.

When a problem raises its head (and each new problem seems to arise out of nowhere) we move mountains trying to solve the issues.

Simon

Yes I agree on your first part of your post. I have myself quite often made this reflection on this thread and others on this forum. I don't like to trade FTSE future (Z-future), too high a stake for my liking, in this case we have the opportunity to trade the FTSE rolling daily, which is an is an excellent choice for trading a specific market. By the way, what did you mean by FTSE future have a average spread of 1.5-3 (earlier post)? You are not talking about whole points are you?

Well Simon, in fact I was not referring to ordinary platforms problems, but unfair treatment of clients, in direct conflict with rules and regulations. You will for sure have a growing number of "unhappy" clients, if you and CS continue on this route of giving bad service to clients who are just trading the "markets", with no intension whatsoever of ripping you off.

Otherwise it is in place to mention that CS has a number of good features as well. For example, I have not noticed a single incident of stop hunting in 4 years time. But at the moment these good features do not overweight the bad aspects of trading with CS (at least not for me). Hopefully this will change together with a change of attitude, towards clients who are just trading on volatility and price action, a normal aspect of a real market in action and performance.

I am quite sure you are "singing in the rain" the whole way to the bank (no offense intended).

 

[Andrej Germanus]

As for comparing the spread betting companies it really depends on what you want to trade and over what time period. For instance IG Index are known to have the widest choice and are good for shares etc but Capital Spreads possibly has the tightest spreads, good for short term trading etc..

 

[jaspertrademaster]

This seems like a good way to go if you do not have positive favorites.

 

[gle101]

As for comparing the spread betting companies it really depends on what you want to trade and over what time period. For instance IG Index are known to have the widest choice and are good for shares etc but Capital Spreads possibly has the tightest spreads, good for short term trading etc..

If you are a short term trader with a high frequency of trades you might get targeted for referral to a dealer.

 

[PipStar]

If you are a short term trader with a high frequency of trades you might get targeted for referral to a dealer.

Youre right. In other words they continously give different type of execution to different types of traders. I know it's been discussed ad nauseum but MiFid is just a cosmetic add-on to make the industry look pretty when it's nothing but. There is no one really to police its implementation and we know we can't trust any of the spreadbet companies to self regulate. As far as the SB companies are concerned it's a free for all for themselves.

 

[Xeno]

(the real killer) the size of most contracts puts them out of reach of many clients.

The Dax contract is the equivalent of a £22 bet and the initial margin required by brokers is over €15,000. (a far cry from our £1 and £50 pound minimum margin requirement)

I think you're overstating the issue of contract size, and you've picked pretty much the biggest contract. Rather than most are too big, there are plenty of contracts which are more reasonable - from memory, minidow $5, bobl/bund €5, FTSE £10, GBP $6.50, EUR $10, minigold $3.25. Also, many people just use/need intra day margins, which can be typically $500

 

[leanhussle]

I think Capital Spreads is shocking...Never get the fills. If you do it will wait until your offside by a few ticks before filling you. Rubbish for short term trading. Potantially good for Long Term trading.