CFD's - 2 Questions

[ridders]

I am new to CFD's and analysing whether or not I should start tradeing CFD's.

My first question is what is the usual minimum trade that each company requires you make - or is there a minimum?

Secondly, what kind of balance do you need to open an account?

Cheers

 

[FTSE Beater]

Hi Ridders

Welcome to T2W

My first question is what is the usual minimum trade that each company requires you make - or is there a minimum?

I presume you mean number of trades a month. If so, then there is usually no minimum number of times that you have to trade.

Secondly, what kind of balance do you need to open an account?

With Deal4Free you need £5000 to open an account

Hope this helps.

 

[ridders]

Cheers for that - most helpful

i also wondered if someone out ther could give some impartial advice. I have 2000 to invest and want to start doing some CFD trading (i know 2000 is not enough). Basically I am not sure which provider to go with. Apart deal4free, there are no firms out there who provide a no commission service - but i do not have sufficient funds to open an account with CMC.

So could anyone give some advice as to the best provider to use. I have been looking at selftrade and they look ok but £9 a trade - pretty expensive!!!!!!!!

Any help much appreciated

 

[peterpr]

Have a look at IG Markets. Not sure about minimum account opening amount but they have a wide range of CFD mini-contracts commission-free (eg £1 per point on FTSE100 - 4 point spread). Plus a slick and reliable dealing interface.

Peterpr

 

[awoodj]

The CFD minimum is £2000 with deal4free so if thats what you have and they look the best then go for them.

PS I used them for a couple of years and for £2k starting pot i think they would be a good choice as with the 0 commision you can trade smaller amount and scale in and out without worrying abuot commision eating into your trades too much.

All just my opinion though

 

[ridders]

I have also seen alot written about Capital Spreads who also charge no commission - any thoughts on them??

 

[Simon]

PS I used them for a couple of years and for £2k starting pot i think they would be a good choice as with the 0 commision you can trade smaller amount and scale in and out without worrying abuot commision eating into your trades too much.

This is something that struck me recently, you can minimise your risk exposure by trading the equivalent of a single share using CFD's, as opposed to a minimum of 100 shares with most SB co's, great for testing a new strategy on a limited budget. Obviously you're still liable to CGT, but this is unlikely to be the primary concern if one is trading such minimal size.

The only hindrance to one with a relative lack of 'proper' trading experince, such as myself, is opening an account. A certain minimum level of experience is required, presumably an @rse covering excercise due to the FSA, however what is this level? 5 yrs of losing cash, 1 yr of astronomical gains, a fortnight of fixed odds type stuff?

 

[neil]

This is something that struck me recently, you can minimise your risk exposure by trading the equivalent of a single share using CFD's, as opposed to a minimum of 100 shares with most SB co's, great for testing a new strategy on a limited budget. Obviously you're still liable to CGT, but this is unlikely to be the primary concern if one is trading such minimal size.

The only hindrance to one with a relative lack of 'proper' trading experince, such as myself, is opening an account. A certain minimum level of experience is required, presumably an @rse covering excercise due to the FSA, however what is this level? 5 yrs of losing cash, 1 yr of astronomical gains, a fortnight of fixed odds type stuff?

Simon,
Who is going to check what you put on the form?
Not that I am advocating such action

 

[Simon]

Who is going to check what you put on the form?

Indeed, why would an SB co. increase it's admin costs with no obligation or reward?