Best Thread Capital Spreads

[Traduk]

Sorry, still don't follow, but I think you misunderstood what I said about stops and limits. If a trade is stopped out by a pip your paper loss becomes real, and you have less margin to make another trade. If the same trade misses a stop by a pip (which may represent any stake) then goes in your favour and makes a profit, you're making money. If a series of high risk trades all get stopped you may soon blow the account, but if they miss the stop you can compound up and potentially make lots of money very quickly. That fits into my definition of luck.

I'm not trying to say that success or failure depends only on luck, or that a good trader won't be more likely to win.

You are right, I did skim read and missed your point regarding stops and limits.

You appear to be creating a hypothetical what if series of alternatives to somehow prove the difference near misses and or near hits can make and add an element of chance that creates some hypothetical difference between what is and is not luck.

I think I understand where you are coming from but do not think that arbitrary stops or limits are of any value and would never use them. Markets within its stair step structure in any time frame shows where the forces at play have decided to stop and reverse throughout various time frames. The market created structural stops are the only ones to which I give any value and once a pivot turn has a price it is non negotiable therefore hypothetical placing of stops and adjustment thereof is irrelevant.

I cannot understand the concept of placing a stop anywhere other than beyond a point which proves a structural change of direction. IMO to do anything other than use such stops is creating an artificial limitation by a trader which will not be recognised or known as of any importance and is artificially creating a chance scenario which relies on luck.

 

[MoonRocket]

One of the hardest things to come to terms with in trading is the realisation of one's own limitations especially when the judge and jury is ourselves.

Perhaps the wisest sentence I have read for a while. :smart:

 

[Ross Spur]

You are right, I did skim read and missed your point regarding stops and limits.

You appear to be creating a hypothetical what if series of alternatives to somehow prove the difference near misses and or near hits can make and add an element of chance that creates some hypothetical difference between what is and is not luck.

I think I understand where you are coming from but do not think that arbitrary stops or limits are of any value and would never use them. Markets within its stair step structure in any time frame shows where the forces at play have decided to stop and reverse throughout various time frames. The market created structural stops are the only ones to which I give any value and once a pivot turn has a price it is non negotiable therefore hypothetical placing of stops and adjustment thereof is irrelevant.

I cannot understand the concept of placing a stop anywhere other than beyond a point which proves a structural change of direction. IMO to do anything other than use such stops is creating an artificial limitation by a trader which will not be recognised or known as of any importance and is artificially creating a chance scenario which relies on luck.

OK, suppose Trader A and Trader B both accept that hard stops have to be used to control risk and have similar ideas about where to place them, but Trader A sets his orders at round numbers and Trader B sets his a few pips away either side. It's quite likely that after only a few trades their P&Ls will be radically different, which is partly why so many profitable back-tested systems appear to fail as soon as they're used live.
The same sort of effect can be seen in trading competitions, where the winner is usually the one who takes the most risk and gets away with it,

To go back to the CS customer who turned a few k into £300k, to me the most surprising and impressive aspect is that he managed to walk away with the cash, and not try to turn £300k into a million, probably losing the lot in the process.

 

[Traduk]

OK, suppose Trader A and Trader B both accept that hard stops have to be used to control risk and have similar ideas about where to place them, but Trader A sets his orders at round numbers and Trader B sets his a few pips away either side. It's quite likely that after only a few trades their P&Ls will be radically different, which is partly why so many profitable back-tested systems appear to fail as soon as they're used live.
The same sort of effect can be seen in trading competitions, where the winner is usually the one who takes the most risk and gets away with it,

To go back to the CS customer who turned a few k into £300k, to me the most surprising and impressive aspect is that he managed to walk away with the cash, and not try to turn £300k into a million, probably losing the lot in the process.

In the stair step of peaks and troughs within a structure the only place to put a stop is beyond the (pivot) peak or trough which proves the trade wrong. How much beyond is personal choice.

Whether stops are hard or soft is personal choice but is discipline is not enough to avoid personal negotiation with soft stops then hard stops are better to use because negotiation costs.

I have never back tested but always test in real time. Market dynamics change all the time and I do not mean the usual trend runs and congestion. Markets swing from range bound to trending for months or years at a time and if the duration of each phase is long then mechanical systems created during a lengthy phase of ranging or trending fall over for months or years.

The 350K winner who walked away is only one of 4 that I have heard of who walked away with 100's of K or in one case £60m. I suspect they all knew exactly the nature of the party they were in (long bull run?) and in company with their knowledge, also knew when it was over. Walking away with a sizeable win and possibly never trading again displays to me the iron will discipline which probably enabled the accounts to grow. They are fairly rare people and have something in their character which is natural and cannot be emulated.

Back in the days of telephone trading I gained a substantial knowledge through anecdotes from account excuctives (dealers) of the then dubbed 5% club etc. I think that just as back then (20 years ago), the top of the pile of traders is thinly populated and superstars are rarer than hen's teeth.

Personally I think if one can make a half decent living out of trading then the effort is worth it.

 

[james1989]

I have a friend who works here. Apparently they delay the withdrawal process in the off chance that the client will trade again, this brings in a substantial amount of extra revenue per annum. STAY AWAY! dirty tricks are not what you need when trading with odds already stacked largely against you.

 

[Ross Spur]

I have a friend who works here. Apparently they delay the withdrawal process in the off chance that the client will trade again, this brings in a substantial amount of extra revenue per annum. STAY AWAY! dirty tricks are not what you need when trading with odds already stacked largely against you.

The official reason will probably be that it's because of FSA money laundering rules. A few years back another SB used this excuse every time you tried to withdraw anything. Fortunately, they soon changed their minds when you pointed out that you'd contacted the FSA, who said this was complete bollox unless you wanted payment in the form of a wheelbarrow full of used tenners.

 

[gle101]

I have a friend who works here. Apparently they delay the withdrawal process in the off chance that the client will trade again, this brings in a substantial amount of extra revenue per annum. STAY AWAY! dirty tricks are not what you need when trading with odds already stacked largely against you.

Really, is this such a big issue? If you as a trader know what odds are stack against you, withdrawal procedures is definitely not of the highest priority.

____________
"Take control with Risk & Money Management"
http://www.trade2win.com/boards/pla...140296-visualrmm-interactive-new-concept.html

 

[Ross Spur]

Really, is this such a big issue? If you as a trader know what odds are stack against you, withdrawal procedures is definitely not of the highest priority.

____________
"Take control with Risk & Money Management"
http://www.trade2win.com/boards/pla...140296-visualrmm-interactive-new-concept.html

It might be if they won't let you have £350,000 of your own money.

 

[gle101]

It might be if they won't let you have £350,000 of your own money.

I don't think so, they have a withdrawal procedure one must follow. It is the same with others, not many complains about withdrawal problems on this thread.

____________
"Take control with Risk & Money Management"
http://www.trade2win.com/boards/pla...140296-visualrmm-interactive-new-concept.html

 

[Truth Seeker]

I don't think so, they have a withdrawal procedure one must follow. It is the same with others, not many complains about withdrawal problems on this thread.

____________
"Take control with Risk & Money Management"
http://www.trade2win.com/boards/pla...140296-visualrmm-interactive-new-concept.html

The reason could be because people on this thread have nothing left in their account to withdraw!

 

[Ross Spur]

Sorry to hear that, TS. Better luck next time.

 

[tim3]

I think sometimes people forget CS is a buisnes and a bookie at that,its there to make money if you judge most companys by strict ethical standards they are a long way from whiter than white.

 

[tar]

Simon , regarding clients money segregation and protection in the UK please check this article :

http://www.trade2win.com/boards/spr...r-investment-capital-uk-really-protected.html

 

[capitalspreads]

james 1989

in the eight years of commenting on this thread i have never actually had to say this but

your statement is an outright lie.

Capital Spreads has never in its entire existence delayed the repayment of fairly won monies except when SOCA has become involved. In reality if we did do this i would have thought that someone might have mentioned it on this thread before now. Accusing us of all kinds of tricks is one thing but cliaming 'you have a friend in our employ' and then 'claiming' that they told you what I know to be an outright lie is quite another.

Tar

concerning segregated monies. Unfortunately I cannot really comment on other companies or what has happened at them but in the UK the actual pure spread betting/cfd companies have a very good record.

All i can say is that we think the FSA seggregated monies rules are quite fierce enough. We must hold all client monies and any net winnings in designated segregated accounts. We cannot even use this to hedge the client's own position. So a client with say £200k in his account who uses the maximum margin on his account and uses all 200k up will still have his money retained in the segregated account.

If CS then hedges the client position by buying Futures or Shares (etc) we must use our own funds to do so. This is why having 25mill of our own money and 'only' 50m or so of client money puts CS in such a strong position. We, and the other big SB companies, are far more highly capitalised than virtually any other type of financial institution.

When you hear talk of tier one capital and people argue about the banks having to retain as much as 10% we are in the situation of having over 300% !

The problem really occurs when you have financial institutions who have big Proprietary risk units as well as a retail Unit. This is what happened with Lehman and MF Global where the prop side 'took down' the perfectly profitable retail arms.

You will be pleased to know that LCG (Capital Spreads) has neither a prop risk desk nor permission from its PLC Board to create one. (so i could not wake up one morning and decide to risk it all on the 4.30 at kempston park).

In reality the people in MF Global will get most of their money back but it might take a while. I did read the reason for this (some accounting/legal reason prevailing in the UK) but for the moment i have forgotten what it is (sorry).

re who is a good and bad trader it really does not matter how you calculate it ... percentage wins ...wins size over loss size taken... whether there is a Y in the month .... in the end a good trader is one who is a) profitable b) profitable and c) profitable

Cheers
Simon

 

[capitalspreads]

Oddly enough LCG is now in the position of wishing to defend the current regulatory structure in spread betting as it prevents competition.

the enormous burdens now in place through the financial system make the possiblity of a low cost competitor coming in to challenge are getting ever more remote. Spread Betting is not a complex product and yet there has not been a successful new entrant (one that has broken into the top tier) since Capital Spreads launched in 2003. Most of the existing companies were in existence before us.

so while everyone wants security (naturally) i would argue that it is now so harsh that it is coming at the expense of competition. Good for LCG as pressure on margins may start to weaken.

Banking is even simpler than Spread Betting but big new banks have only started emerging for the first time in forty or fifty years and this is simply because the others have been so weakened that the opportunity has arrisen. I doubt if Virgin or Tesco would be going into banking if Northern Rock, BB had not gone bust and the other banks had not had their reputations trashed.

Simon

 

[Ross Spur]

Oddly enough LCG is now in the position of wishing to defend the current regulatory structure in spread betting as it prevents competition.

the enormous burdens now in place through the financial system make the possiblity of a low cost competitor coming in to challenge are getting ever more remote. Spread Betting is not a complex product and yet there has not been a successful new entrant (one that has broken into the top tier) since Capital Spreads launched in 2003. Most of the existing companies were in existence before us.

so while everyone wants security (naturally) i would argue that it is now so harsh that it is coming at the expense of competition. Good for LCG as pressure on margins may start to weaken.

Banking is even simpler than Spread Betting but big new banks have only started emerging for the first time in forty or fifty years and this is simply because the others have been so weakened that the opportunity has arrisen. I doubt if Virgin or Tesco would be going into banking if Northern Rock, BB had not gone bust and the other banks had not had their reputations trashed.

Simon

Virgin are going into banking because they've effectively been given part of the money to do it by the government on our behalf. Still, Richard Branson obviously needs the dosh and certainly deserves our charity.

 

[capitalspreads]

having recently commented on client segregated money and in light of recent events i would like to make a statement.

Capital Spreads client money is totally segregated from the moment that it is received by the company. All retail client funds are held with UK Tier One banks with not less than an A1 (the highest) short term rating.


Capital Spreads is owned by LCG plc which is audited by Deloites. Our Banks must provide DIRECT evidence to our auditors that the money that we say is in the segregated accounts IS actually there AND that these accounts are definated designated as segregated money accounts.

As it happens LCG's spread betting and CFD units currently do not have a single active 'professional' account (whose monies may be non segregated) and so every penny within these units is segregated. This means that our retail clients cannot be impacted by the actions of other much larger professional clients of LGC.

Personally i wish well to all at worldspreads and hope that they can solve their current problems

Simon

 

[tar]

The problem really occurs when you have financial institutions who have big Proprietary risk units as well as a retail Unit. This is what happened with Lehman and MF Global where the prop side 'took down' the perfectly profitable retail arms.

You will be pleased to know that LCG (Capital Spreads) has neither a prop risk desk nor permission from its PLC Board to create one. (so i could not wake up one morning and decide to risk it all on the 4.30 at kempston park).

Simon

What about Worldspreads situation then , they don't have a proprietary trading unit as well , do they ?

Irish spreadbetting firms shares suspended | Forex Magnates

 

[capitalspreads]

tar

In truth i have no idea. There is always risk of financial impropriety and companies must put defences in place against it (which is why for instance that I, even though i am the CEO, cannot actually transfer any money outside LCG and nor can any individual director)

simon

 

[tim3]

The problem is not so much what sb companys say its what they do.

Worldspreads say that clients money is segregated Safety of funds | Spread betting with us | WorldSpreads yet from what I have read they have not yet said clients can refund their deposits or given any indication when an update will be issued they need to do that very quickly it must be really worrying if you have a large amount of capital deposited there or in winning trades.

MF global had segregated accounts but decided to dip into them!

The fsa seem to have failed again here what system (if any) do they have to ensure segregated accounts stay just that segregated or do they just rely on the sb companys to do it?

Maybe it would be an idea for clients to have access to their funds seprate from the sb company for example giving them access to there own money via a second company like say Barclays totally seperate from the sb account and money is only taken out of that account to cover margin.

In situations like this the market leader benefits imo.