Best Thread Capital Spreads

[stevespray]

Thanks AJ - very interesting - the whole spreadbet industry seems to be another bubble but a few will survive and prosper, I guess...

The big mistake seems to be to go for a "corzine" and get greedy - which is effectively what the management at WS did also...

If you look at the rapid growth of some of the SB Co's from 2000 onwards then you can see the size of the dilemma for some of the smaller wanna-be firms which pop up from time to time. Either they hedge very little, (hope the customer gets it wrong) and clean up with the profits from the bucket trades OR hedge many positions and make steady but very SLOW profits which risks competitors developing new products and better platforms which might see the customers moving across.

Steve.

 

[aj11]

my two cents

In regards to Cantor Index, they also have had their problems in the past for example: Cantor Index fined 70,000 for misleading spread betting promotions

However they are probably in the black now but that isn't a good thing in the spread betting world.
Yes for the clients it is good but the company itself would have suffered in terms of profits.
The easiest way to realise this is by just searching the company on alexa.com

Cantor's main site cantorcapital.com comes outside the top 6 million on visited websites...
That means even SME Brokers like etoro even though they dont have the reputation or the knowhow/experience in the industry and may have some dodgy goings on, they are getting hundreds more clients trading their FX platform daily so the toss up is whether you want to make money in this world or whether you want to make REAL MONEY !!!

 

[ffsear]

ANyone have issues on CS demo platform? All of a sudden it won't load up after login. Tried on IE8, Chrome and Firefox, same problem!

 

[Traduk]

ANyone have issues on CS demo platform? All of a sudden it won't load up after login. Tried on IE8, Chrome and Firefox, same problem!

Live account server is working OK but demo server is either not loading or if it does then is not functioning.

The demo has been hit and miss recently

 

[fibbinstarchi]

Not good advertising. Maybe a costing problem with finances...

 

[Traduk]

ANyone have issues on CS demo platform? All of a sudden it won't load up after login. Tried on IE8, Chrome and Firefox, same problem!

Resolved in what appears double quick time which is not at all bad for advertising as I believe it is an outsourced system.

 

[AC007]

after world spread who is next?

 

[brettus]

In regards to Cantor Index, they also have had their problems in the past for example: Cantor Index fined 70,000 for misleading spread betting promotions

However they are probably in the black now but that isn't a good thing in the spread betting world.
Yes for the clients it is good but the company itself would have suffered in terms of profits.
The easiest way to realise this is by just searching the company on alexa.com

Cantor's main site cantorcapital.com comes outside the top 6 million on visited websites...
That means even SME Brokers like etoro even though they dont have the reputation or the knowhow/experience in the industry and may have some dodgy goings on, they are getting hundreds more clients trading their FX platform daily so the toss up is whether you want to make money in this world or whether you want to make REAL MONEY !!!

That promotion was for mobile trading. I think they decided to bin it. Some guy bought a contract with the XDA, then Cantors decided to bin the idea, so the guy was stuck with a contract. Cantors paid his contract in the end but it was too late by then.

The point you were trying to make is that Cantors might be the next company to go belly up and take your money. I'm telling you that this will never happen as the company is backed by the brokerage company and is part of a trillion dollar company.

 

[Ross Spur]

So who's going under next:
CMC- Pissed away £100m on a new platform and then told all there clients to go away. Losing money for a couple of years now. The culture of 'Steal 4 Free' still very strong.

City Index- Losing money for years, probably dodgy stuff going on behind the scenes but keep getting bailed out by Michael Spencer.

Cantor Index - Losing Money, even though they've got no clients. Parent company probably wind up the operation as not worth the hassle.

SpreadCo- Proper tin pot operation, bound to go under.

Although I agree that CMC's new platform was and is a disaster and must have lost them clients and money (£100, not £100m, surely?) they're unlikely to run out of cash

 

[capitalspreads]

the demo platform is just that .. a demo..

we focus 99% of effort on the live "real money" platform and only really notice any problems on the demo when a client tells us. The pricing comes from the same engine but the servers are different.

Q

overnight pricing comes from the FTSE futures which are nearly 24 hrs these days and our own algo for the DAX. I am sure that our competitors have their own algo's to calculate the price but i have to say that ours seems to work very well from 'closing' price to 'opening price' the next day.

i can assure you that we certainly do not hedge with any competitor ... if we have excess risk in the DAX overnight we hedge with the S&P. Not because the correlation is 100% but because we are talking about excess risk here and the DAX is not going to fall 200 points while the S&P goes up 200 points. In general all teh indices move in the same direction .. not always by the same amount in percentage terms but what we lose one day on the swings we will gain the next on the roundabout.

concerning financial stability all you really need to do is look at the Cash position of LCG (capital spreads holding company) we have miles over 100% tier 1 capital (most major banks have less than 10%). We have built the cash position up slowly over years. when times were tough we did not pay divvy's (even though we had enough money to pay one) because we wanted to ensure the financial strength of the company.

over the last few years this financial prudence has left LCG in a very strong position.

Simon

 

[capitalspreads]

not much comment here at the moment

I realise the WS has taken the headlines but...(advert here) for those looking for a stable home for their trading pot then Capital Spreads has proved itself over the years to be the 'clients choice'.

I admit we do not offer some tiny little AIM listed minnow like some do ... but frankly these illiquid stocks act like mines on balance sheets and any small spread betting /cfd company offering them should be treated cautiously.

What we do offer is fixed tight prices on a massive array of the markets that our clients want to trade in. We offer them on a simple, easy to understand platform.. with amazing chart and order functionality and with a control risk built in. (this not only helps you control your risk but gives our clients the peace of mind that their money is not going to be polluted by the activities of another customer being given credit/waived margin etc and blowing away the money pot.)

Blatent pitch for WS clients but ... this is business

Cheers
Simon

 

[hacks]

Simon, you said in a previous post that you do not take margin money out of the clients' segregated account. Is this the policy of CS or is it expressly forbidden by the FSA?

Thanks.

 

[capitalspreads]

Hacks

for retail clients it is a rule of the FSA.

Capital Spreads MUST use its own money as margin with our brokers when we hedge these positions.

Deloittes (our auditors) make sure that this is the case with independent verification of the cash positions in the segregated accounts. (i.e they do not ask us to get the bank statements... they go directly to the banks and ask for them independently) and not just the year end balance (which presumably could be fiddled) but the ongoing balance in the accounts throughout the year.

Simon

 

[stevespray]

Hacks

for retail clients it is a rule of the FSA.

Capital Spreads MUST use its own money as margin with our brokers when we hedge these positions.

Deloittes (our auditors) make sure that this is the case with independent verification of the cash positions in the segregated accounts. (i.e they do not ask us to get the bank statements... they go directly to the banks and ask for them independently) and not just the year end balance (which presumably could be fiddled) but the ongoing balance in the accounts throughout the year.

Simon

Good Morning Simon,

Sorry to labour the point on this one but are you 100% sure on this point?

Also, do the FSA rules allow the firm to take a deposit from client funds to cover the opening of a position by the client? Possible grey area? On top of that, are there any specific rules which cover 'variation margin' with regard to money which could be removed from the segregated accouts to cover current losses being run by a client on their positions?

I'm just trying to put some meat on the bones with regard to this fiasco at Worldspreads.


Cheers,
Steve.

 

[capitalspreads]

steve

this is how we read the rules (but the FSA apparently won an award for plain english a few years ago which had those in the industry, who have to wade through the rule book, coughing into our drinks!)

FSA rules on RETAIL client money DO NOT ALLOW companies to take funds as margin against their positions (strange as this might seem). If you are designated as Professional AND have agreed collateral title transfer on your money then a company may intermingle your funds with theirs. Generally a company will insist on this if you are very large or you take big positions in markets like small cap stocks that require large cash deposits with brokers.

NO we cannot remove funds to cover running losses (as this might impact other clients funds within the segregated fund) . What we can do is offset winning bets against losing bets (but only up to the level of the winning bets). So if clients have £30m deposited but are running £1m profits and £6m losses the company MUST still retain £30m in the segregated accounts.

So the companies MUST have the resources to be able to fund hedging losses even though the clients may not yet have taken them.

WHEN AND ONLY WHEN a loss is realised by the client can the money be taken from the segregated account

This is how Capital Spreads has always read the rules (and we have had several inspections from the FSA on this matter and they seem to agree)

Simon

 

[Roonbox]

not much comment here at the moment

I realise the WS has taken the headlines but...(advert here) for those looking for a stable home for their trading pot then Capital Spreads has proved itself over the years to be the 'clients choice'.

I admit we do not offer some tiny little AIM listed minnow like some do ... but frankly these illiquid stocks act like mines on balance sheets and any small spread betting /cfd company offering them should be treated cautiously.

What we do offer is fixed tight prices on a massive array of the markets that our clients want to trade in. We offer them on a simple, easy to understand platform.. with amazing chart and order functionality and with a control risk built in. (this not only helps you control your risk but gives our clients the peace of mind that their money is not going to be polluted by the activities of another customer being given credit/waived margin etc and blowing away the money pot.)

Blatent pitch for WS clients but ... this is business

Cheers
Simon

Hi Simon,

I am considering opening an account with capital Spreads. I am currently with Marketspreads but want to trade TBF(ProShares Short 20+ Year Treasury) as opposed to the leveraged TBT.

Can I trade this with Capital Spreads?

Liam

 

[kwickwool]

back in the office and found out what happened on the 'spike'.

rather prosiacally a dealer, in adjusting the 'Fair Value' price for the FTSE (the adjustment in the Futures price to get the cash price), made a silly error. It was noticed immediately and all activated loss orders were reversed and clients recompensed. Unfortunately this also means that any sudden 'profits' were also removed (sorry)

Simon

Hi Simon, Sent you a personal message but no need to answer as had a comment back blew my mind with metatrader and got me to thinking about the spike that you stated happened here, your answer above, and questions i have with this. You have answered yourself pretty well on this forum and good credit to you so I hope you can continue and comment on these points i make below regarding this spike

1. Why is it that this glitch happened and just happens to be the perfect software glitch for a spread betting company as in an untradeable spike that hits stop orders? You answer as in a simple human error that can cause this means that a simple human error performed in the wrong way can also manipulate this?
2. From the thousands of accounts how did you manage to make sure that all trades effected by this were fully refunded?
3. How do you regulate and ensure that this is always picked up and can never happen without being spotted? Because you always talk about averages over a time period for a few spikes a day in the system they would be untraceable against thousands of other orders?
4. What is concerning is that you state that just one dealer had the power to perform this manipulation,What if it was a 1 pip spike? 2 pip spike? 3 pip spike? hardly noticeable but profitable for yourselves? if they have visibility as to your companies total exposure with stop limits do you see how this can be abused?

thanks,

Christian

 

[gle101]

Simon, apparently it seems like you have you changed your execution model? One no longer cannot be sure to get the priced clicked on but can get slippage (both positive and negative I guess). Is my assumption right or have I got it wrong?

Any news about 1 point spread on the Dow?

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

 

[pboyles]

Hi Simon, Sent you a personal message but no need to answer as had a comment back blew my mind with metatrader and got me to thinking about the spike that you stated happened here, your answer above, and questions i have with this. You have answered yourself pretty well on this forum and good credit to you so I hope you can continue and comment on these points i make below regarding this spike

1. Why is it that this glitch happened and just happens to be the perfect software glitch for a spread betting company as in an untradeable spike that hits stop orders? You answer as in a simple human error that can cause this means that a simple human error performed in the wrong way can also manipulate this?
2. From the thousands of accounts how did you manage to make sure that all trades effected by this were fully refunded?
3. How do you regulate and ensure that this is always picked up and can never happen without being spotted? Because you always talk about averages over a time period for a few spikes a day in the system they would be untraceable against thousands of other orders?
4. What is concerning is that you state that just one dealer had the power to perform this manipulation,What if it was a 1 pip spike? 2 pip spike? 3 pip spike? hardly noticeable but profitable for yourselves? if they have visibility as to your companies total exposure with stop limits do you see how this can be abused?

thanks,

Christian

Have you ever seen the videos about how metatrader can be used to manipulate prices, delete orders, introduce slippage etc etc? This is all done intentionally, you are trading against a bookie and he'll do his utmost to win, by fair means or foul.

 

[pboyles]

Hacks

for retail clients it is a rule of the FSA.

Capital Spreads MUST use its own money as margin with our brokers when we hedge these positions.

Deloittes (our auditors) make sure that this is the case with independent verification of the cash positions in the segregated accounts. (i.e they do not ask us to get the bank statements... they go directly to the banks and ask for them independently) and not just the year end balance (which presumably could be fiddled) but the ongoing balance in the accounts throughout the year.

Simon

Just like MF Global and Worldspreads did.