Best Thread CMC Markets owner answers your questions

[PC at CMC Markets]

Hi bjorn (that is only swedish name I know)

If only I could afford to employ you, I could have you as my spread advisor, you know a bit like Tescos price watch gurus. Think what a team we could make. ha ha

pc

I thought you said we should move on, ha ha. Yes a matter of fact I did, I notice it was, I believe 2 point something, closer to 2 point I think. CMC is finally shaping up, still, some distance to go. No really, I think 2 point spread on the Dow is OK, but it shouldn't be more. There is one company with lower spread, and they have caught my interest after 6 month of observing, didn't think they would stick to it, but they have. So I signed up and are at the moment happy with the service they provide.

 

[PC at CMC Markets]

Nothing wrong with abba along with the spice girls best two groups ever ha ha

Sorry, I don't know what his name is, but he's Swedish, so I doubt it's Chris. He might have been in Abba once, though.

 

[PC at CMC Markets]

hi spreadbeta let me read this review tomorrow but have to say my first impression is that it is ridiculous to say spread bet is taxable because we already pay a betting levey once you trade. I might get one of my compliance people to look at it. will get back to you.

have a nice evening.
tks pc

Thanks for your answer but in that case I wondered what your view of John Whiting (UK Goverment Tax Guru / tzar) statement on the BBC that Spreadbetting *IS* taxable by HMRC for example if it is your sole income that year !! (See Q16 at http://www.bbc.co.uk/news/10294803)

As I took redundacy last year but have continued to Spreadbet I was wondering if Nextgen CFD's may be more appropriate if I was in danger of suddenly being taxed if I were to make money SBing this year !!?

Do you know of any cases where SB's have had to pay tax (in reality) ?. If SBing is not ALWAYS tax free it would surely impact the SB industry as it is one of its main selling points of SB over CFD's

 

[gle101]

Hi bjorn (that is only swedish name I know)

If only I could afford to employ you, I could have you as my spread advisor, you know a bit like Tescos price watch gurus. Think what a team we could make. ha ha

pc

Yes wouldn't that be great, ha ha, but don't forget to bring in Ross.

 

[gle101]

hi spreadbeta let me read this review tomorrow but have to say my first impression is that it is ridiculous to say spread bet is taxable because we already pay a betting levey once you trade. I might get one of my compliance people to look at it. will get back to you.

have a nice evening.
tks pc

No doubt about it, if spread betting is your sole income (above a certain level depending on the country in question), you're as an individual is liable for taxation. In Sweden there was an official from the FI (FSA), stating that a spread bet could be regarded as an option or a warrant, anyway, a kind of financial instrument that very well could become taxable. If it becomes taxable the regulation will probably tighten even more. A spread betting case has not to my knowledge been brought to court yet on this issue in Sweden.

 

[Black Swan]

Perhaps it's my Scottish ancestry, but I often don't make trades because the spread is too wide. On illiquid shares particularly the spread can make a huge difference, but even on major FX and indices it's important. Frinstance, if I make 50 trades on a 1pip spread market and average 1pip/pt profit on each one, that's quite a good result, as I'll be among the elite 10% or whatever who win. But if I do the same thing with a 2pip spread, I instantly become part of the 90% who lose. If the 1pt SB always slipped, then that might be a good reason to use CMC instead, but they don't.

Only talking FX, certain commods. oil and metals though bud. I don't *trade* shares..invest in a few, but would never 'day trade' 'em.

 

[PC at CMC Markets]

hi gle101
we are only talking about tax free in Uk on the blog. In Uk as far as we are concerned it is tax free but will review posting tomorrow but I would be surprised if spread betting is not tax free. will get back to you all tomorrow.

cheers pc

No doubt about it, if spread betting is your sole income (above a certain level depending on the country in question), you're as an individual is liable for taxation. In Sweden there was an official from the FI (FSA), stating that a spread bet could be regarded as an option or a warrant, anyway, a kind of financial instrument that very well could become taxable. If it becomes taxable the regulation will probably tighten even more. A spread betting case has not to my knowledge been brought to court yet on this issue in Sweden.

 

[Shakone]

If you're taking a lot of trades intraday on one instrument which last minutes to hours, the difference of 1 pip in the spread is huge as Ross Spur said. If you're holding for 4 hours, 8 hours, or for days, perhaps the 1 pip spread doesn't mean anything to you.

I too took a look at CMC demo-platform. Very nice to look at but the spreads are far too wide. Currently I have to use two different spreadbet companies because each one has a poor spread for something I trade, and a good spread for something else. It is a bit of a pain not to have it all in one place, so if CMC get the spreads down, I'll consider switching, until then, no way.

Another suggestion for CMC platform, have a calendar like this one

http://www.forexfactory.com/calendar.php

A lot of people check this calendar on FF, just because even if the spreadbet/broker has a calendar available on the platform, they are usually pretty poor, in that they either miss out important announcements or don't highlight the important from the less important.

 

[PC at CMC Markets]

come on gle101 we couldnt have you, Ross and me in the same room we would never agree on anything...

Yes wouldn't that be great, ha ha, but don't forget to bring in Ross.

 

[gle101]

come on gle101 we couldnt have you, Ross and me in the same room we would never agree on anything...

No I give you that, you are probably right this time.

 

[Ross Spur]

Yes wouldn't that be great, ha ha, but don't forget to bring in Ross.

Sorry, I don't get out of bed for less than £10k, so he can't afford me.

 

[Ross Spur]

come on gle101 we couldnt have you, Ross and me in the same room we would never agree on anything...

But that's exactly why you need argumentative b******S like me and gle101. No point in employing people who agree with everything you say.

 

[PC at CMC Markets]

Hi Shakone

Many thanks for your blog. First time I have received one from you I think.

You raise a very good point of course but I am not trying to argue that 2 pips is better than 1 in mathematical terms but that there is more to spread betting than head line grabbing spreads. What I am saying is that there are some firms that offer 1 pip when we offer 2 but I maintain that through precision pricing, automated execution, no requotes, no fill or kill, no ticket time out, no dealer referal over a period of time then our execution will be more accurate and superior to the head line grabbers and you will not be paying extra spreads.

There are firms out there now under cutting each other to attract business but I do not know of any spread bet firm that offers the above type of execution. I am just saying that spreads are not an exact science, you cannot compare spreads and assume that you are saving money because your sb firm has lower head line rates. I honestly think that spread bet clients should open small account with us and make like for like comparisons of all the above and see how accurate the fills are comparing us to your regular spread bet firm.

I should also add that because all pricing and execution is done electronically by a computer there is no reading of a client position when they want to open or close a trade. the pricing system is blind to who wants to trade on the price. also every one of our prices quoted is good for an amount.

What we are trying to do is make the spread bet markets more of an institutional service, for the retail investor. We are not trying to get institutions to trade with us because there are no tax advantages on spread bet. However, I think that no requotes, fill or kill, ticket time out, dealer referral of client orders should be eliminated from the spread bet industry. It will not be easy because so many spread betters are bargain hunting when they should be looking for the complete all round service.

I suspect at the moment you might get tighter head line spreads on some products from your existing spread bet provider but the execution is not of the standard we offer. let me know I am happy to stand corrected if I am wrong.
Open an account, give us a try and compare the two and let me know what you find.

more stuff coming on next gen including calendars etc should be here within four weeks.

thanks Peter

If you're taking a lot of trades intraday on one instrument which last minutes to hours, the difference of 1 pip in the spread is huge as Ross Spur said. If you're holding for 4 hours, 8 hours, or for days, perhaps the 1 pip spread doesn't mean anything to you.

I too took a look at CMC demo-platform. Very nice to look at but the spreads are far too wide. Currently I have to use two different spreadbet companies because each one has a poor spread for something I trade, and a good spread for something else. It is a bit of a pain not to have it all in one place, so if CMC get the spreads down, I'll consider switching, until then, no way.

Another suggestion for CMC platform, have a calendar like this one

http://www.forexfactory.com/calendar.php

A lot of people check this calendar on FF, just because even if the spreadbet/broker has a calendar available on the platform, they are usually pretty poor, in that they either miss out important announcements or don't highlight the important from the less important.

 

[Black Swan]

If you're taking a lot of trades intraday on one instrument which last minutes to hours, the difference of 1 pip in the spread is huge as Ross Spur said. If you're holding for 4 hours, 8 hours, or for days, perhaps the 1 pip spread doesn't mean anything to you.

Anyone using SB (any firm) to trade off small TFs is either very inexperienced or delusional.

 

[PC at CMC Markets]

Hi Spreadbeta

I read the article and I have asked my legal department to comment on it and once they have will give you their response.
However, I can answer some of the points.
The expert answered, ''yes probably'' that is not clear answer and I think he was saying that if it is a hobby no, if it is full time profession then maybe. I am not sure if this point has ever been addressed by tax expert but clearly if it is a hobby, or past time then it is tax free. (I am not tax expert, my compliance dept. will be horrified I am making comment on this, this is just my personal opinion, please seek professional advice regarding your own personal opinion)

definitely cfds are taxable and that is clear. lots of our clients use cfds to hedge physical positions, maybe they are long a share and then they short the index if markets turn volatile. profits and losses from both sides are off settable against cgt tax so it depends on what you are trading, why you are trading but in any event cfds are trading and subject to cgt.

will get back to you once I know more.
Hope that helps and thanks for the blog very interesting but I would be surprised if spread betting profits were subject to cgt since there is already a charge on client positions and trades that we pay to the revenue.


thanks peter

Thanks for your answer but in that case I wondered what your view of John Whiting (UK Goverment Tax Guru / tzar) statement on the BBC that Spreadbetting *IS* taxable by HMRC for example if it is your sole income that year !! (See Q16 at http://www.bbc.co.uk/news/10294803)

As I took redundacy last year but have continued to Spreadbet I was wondering if Nextgen CFD's may be more appropriate if I was in danger of suddenly being taxed if I were to make money SBing this year !!?

Do you know of any cases where SB's have had to pay tax (in reality) ?. If SBing is not ALWAYS tax free it would surely impact the SB industry as it is one of its main selling points of SB over CFD's

 

[PC at CMC Markets]

Hi Benny and the links.

All things you requested are in hand except the shifting forward. This will not be on next upgrade due in next four weeks. But it is on the list.

bit frosty around your way this morning was it. Bit cold for links golf at moment.
cheers pc

Hi Peter,

I am struggling with your charts at the moment so I am looking forward to the upgrade. Can you please look at being able to put moving averages on a chart in relation to the high or low of a bar or candle? I would also like to shift them forward as is possible on other platforms. The ability to change their colour would be good as well. Currently, I have pink and purple on one of my charts. Ugh!

There also doesn't seem to be much space for charts. Any chance of undocking and sending to a second screen? May not be possible, but I thought I'd ask.

Hopefully the zooming in to get a clear picture of the last few bars or candles will not alter the time frame in the next version.

Regards, BD

 

[PC at CMC Markets]

Hi gle101
See your man got hammered in FA cup last night by Man City. Sorry about that.
Oh and thanks very much for Ulrika very nice you can have her back soon though she's getting older

cheers pc
##

No doubt about it, if spread betting is your sole income (above a certain level depending on the country in question), you're as an individual is liable for taxation. In Sweden there was an official from the FI (FSA), stating that a spread bet could be regarded as an option or a warrant, anyway, a kind of financial instrument that very well could become taxable. If it becomes taxable the regulation will probably tighten even more. A spread betting case has not to my knowledge been brought to court yet on this issue in Sweden.

 

[gle101]

Hi gle101
See your man got hammered in FA cup last night by Man City. Sorry about that.
Oh and thanks very much for Ulrika very nice you can have her back soon though she's getting older

cheers pc
##

Yes I read about it, well that is the name of the game I guess. He has been through quite a lot. The British were too hard on him when he did a good job a few years back. Yes I guess she is eager to get on the course again, not too fun with only business I guess. You are talking about golf, no maybe not, a TV personality perhaps.

 

[Ross Spur]

Anyone using SB (any firm) to trade off small TFs is either very inexperienced or delusional.

Check out www.InexeperiencedandDelusionalPikers.co.uk, our subscriber list is growing fast.

 

[Ross Spur]

If SB isn't tax-free, there would seem to be a major problem with the way it's been promoted for the last decade or so! In fact, the whole industry would fall apart, and Europe would soon be full of deep discount futures brokers instead, as in the US.