spreadbet said:
errr?
D4F's US30 rolling cash has a spread of 5 points. IGIndex's Daily Wall St has a spread of 8 points. D4F's 'rolling cash' is a superior product to IG Index's 'Daily' product. It is beyond me why anyone would take out a CRB on a daily product.
You don't need to predict a top or a bottom but if using spread bets you do need to anticipate a turn whilst the SB pricing is still favourable to your planned position to maximise returns. So, if I see resistance at 9000 and I know that previous tests of this level have failed it would be better to get my trade in before it reached 9000 and turns and the SB company moves the price against me. The advantage of this is that if I am wrong and the index breaks through the 9000 level I will have gone short when the bias was in my favour and whilst the bias will not be in my favour it is unlikely that it will have worsened when I take the stoploss.
By entering my short position when the actual is at 8995 and the SB company is quoting 8995 to sell I will be in a better position than if I wait for the fail at 9000 and try to enter at 8995 when the SB price is now biased downwards. If I am wrong and it breaks 9000 and my stop is 9005 on the actual it is probable that as it is going up the SB price will still be biased up and I will be able to exit with 9012 or similar as their buy price. My loss for the failed trade will be 17 points.
If I wait for it to hit 9000 and then turn and enter the trade when the actual is at 8995 I will probably get 8988 (at best) as the sell price and I will have given away a potential 7 points of gain. If this trade should fail and it reverses against me (goes up in this example) then my stoploss would be biased against me (biased up). I now have the worst of both worlds I am selling when it is biased down and buying (to stoploss) when it is biased up. A planned entry which anticipates a likely reversal would be more profitable for a win and less costly for a loss.
I use this method regularily and it makes a significant difference to returns. Four Dow trades yesterday netted over 200 points and three MUV2 trades added another 600 points. Losing trades (there were a few) lost less than 100 points. I don't do that every day but the MUV2 trades would have netted about 200 points if i had waited for confirmation of the move. Health warning, do not trade MUV2 if you are a beginner or do not have your money management rules firmly embedded - it is a killer and typically has a 50 point spread.
Not exactly trying to pick tops and bottoms but trying to use the SB bias to favour my trades.
By entering my short position when the actual is at 8995 and the SB company is quoting 8995 to sell I will be in a better position than if I wait for the fail at 9000 and try to enter at 8995 when the SB price is now biased downwards. If I am wrong and it breaks 9000 and my stop is 9005 on the actual it is probable that as it is going up the SB price will still be biased up and I will be able to exit with 9012 or similar as their buy price. My loss for the failed trade will be 17 points.
If I wait for it to hit 9000 and then turn and enter the trade when the actual is at 8995 I will probably get 8988 (at best) as the sell price and I will have given away a potential 7 points of gain. If this trade should fail and it reverses against me (goes up in this example) then my stoploss would be biased against me (biased up). I now have the worst of both worlds I am selling when it is biased down and buying (to stoploss) when it is biased up. A planned entry which anticipates a likely reversal would be more profitable for a win and less costly for a loss.
I use this method regularily and it makes a significant difference to returns. Four Dow trades yesterday netted over 200 points and three MUV2 trades added another 600 points. Losing trades (there were a few) lost less than 100 points. I don't do that every day but the MUV2 trades would have netted about 200 points if i had waited for confirmation of the move. Health warning, do not trade MUV2 if you are a beginner or do not have your money management rules firmly embedded - it is a killer and typically has a 50 point spread.
Not exactly trying to pick tops and bottoms but trying to use the SB bias to favour my trades.
Why would anybody in their right mind use spread-betting market makers is beyond me.
Learning how to play markets as well as learning SB’s devious strategies and their dubious biasing techniques based on their dodgy quotes is just insane.
The odds are so heavily stacked up against you – it’s a losing game.
If there any profitable SB traders (some here claim to be) can you imagine how profitable they would be in the real world, using “proper” brokers and real quotes?
Learning how to play markets as well as learning SB’s devious strategies and their dubious biasing techniques based on their dodgy quotes is just insane.
The odds are so heavily stacked up against you – it’s a losing game.
If there any profitable SB traders (some here claim to be) can you imagine how profitable they would be in the real world, using “proper” brokers and real quotes?
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I find that spread betting can be very profitable indeed - for the right strategy. I have been dabbling with my SB account recently and am using it to trade the long trends - so I place a small bet on the futures three months ahead, and walk away. Easy peasy.
My main trading is intraday with IB, but there's no way I would hold positions overnight, whereas with the SB account I really don't care because I'm not worried about a 200 point move against me on the Dow.
It's all horses for courses; IMO IB is better for shorter strategies, and SB is better for longer strategies.
My main trading is intraday with IB, but there's no way I would hold positions overnight, whereas with the SB account I really don't care because I'm not worried about a 200 point move against me on the Dow.
It's all horses for courses; IMO IB is better for shorter strategies, and SB is better for longer strategies.
I agree with Skim and Helen
It is very difficult to day trade with the SB companies- I have found out to my cost.
If a trade moves against you -you can usually recover it over the long term. If it moves against you whilst day trading it is very unlikely that you will recover all your losses-especially during the same day.
It is very difficult to day trade with the SB companies- I have found out to my cost.
If a trade moves against you -you can usually recover it over the long term. If it moves against you whilst day trading it is very unlikely that you will recover all your losses-especially during the same day.
Newtron Bomb
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I also agree, i think to trade successfully with sb's you need a good average range of a fair size 120 points min, we are not seeing that on the European markets at all at the moment... even the ibex which has traded quite well is not conforming at the moment, so its waiting time for my day trading activity in Europe or look at the dow.
I think it was Skim that said not taking a position is taking a position
I think it was Skim that said not taking a position is taking a position
Great Thread.
My understanding from this is....
A. Do not use SB's for day-trading because if the spread/bias does not get you the whipsaws will.
B. SB's are good for longer term trades - roll over bet using a 1 or 3 month futures contract e.g. DAX, IBEX35, EUROSTOXX50 .
My understanding from this is....
A. Do not use SB's for day-trading because if the spread/bias does not get you the whipsaws will.
B. SB's are good for longer term trades - roll over bet using a 1 or 3 month futures contract e.g. DAX, IBEX35, EUROSTOXX50 .
Del,
SB's are fine for day trading, just need a plan, patience and practice :| Indices are harder yes but they offer a good tax free*
source of trading, I also use them to hedge, SB's have their place but they are no substitute for direct access trading in any market.
Cheers a320.
SB's are fine for day trading, just need a plan, patience and practice :| Indices are harder yes but they offer a good tax free*
source of trading, I also use them to hedge, SB's have their place but they are no substitute for direct access trading in any market.
Cheers a320.
a320
Reading naz's comments it seems level 1 trading of indices using SB's is much more difficult. Even still most people seem to start here and progress or give up. Still not sure if it's road we must travel or an unnecessary agony we put ourselves through ...hmmm..... this is the que for all old sages and wisemen to impart their wisdom.
Reading naz's comments it seems level 1 trading of indices using SB's is much more difficult. Even still most people seem to start here and progress or give up. Still not sure if it's road we must travel or an unnecessary agony we put ourselves through ...hmmm..... this is the que for all old sages and wisemen to impart their wisdom.
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