Spread-Betting with IG

[ianhey]

elc

When I opened an account with IG they would only allow me a limited risk account, that is not leveraged. When I wanted to upgrade to leveraged they asked a long list of questions many of which related to margin and risk management.

As new to s/b I am surprised they opened a full account.

Good luck for the future.

Ian

 

[georgedon]

good read

Thanks for this. I have learned the hard way that in trading the enemy is not the market, not the broker, not other traders. If you want to see the enemy, get a mirror.

 

[x4x]

Thanks for this. I have learned the hard way that in trading the enemy is not the market, not the broker, not other traders. If you want to see the enemy, get a mirror.

I absolutely agree, they can make money on a demo, but when they lose on a real account they blame the broker.

 

[aag100]

what on earth are you doing trading at £9pp with only a couple of hundred £s in your account?

 

[Vasco da Banana]

what on earth are you doing trading at £9pp with only a couple of hundred £s in your account?

He has an irrational desire to be IG's personal Santa.

 

[aag100]

He has an irrational desire to be IG's personal Santa.

hes not the one going ho ho ho,IG are going ha ha ha

 

[skint3839]

Many brokers have little ways to make a few quid from you, the secret lies in knowing your platform and provider, get some independant charts running alongside your brokers, trade your brokers weaknesses, learn how they work then you will learn how to trade. use spreadbet platforms for swing trading, the smaller intraday stops that are touted will kill you spreadbetting!! I gave IG 5-10K over 2 years, looking back I was crazy, but That was my entry fee and apprenticeship! I was naive enough to believe my spreadbet broker worked with me!ha! 4 years on and I look back and laugh at some of the trading I did back then, I dont blame the broker it was my naivety in trading, people often overlook how spreadbet brokers work and how they make money its a crucial part of trading knowing how the system works without that knowledge you dont have much of a chance, they may be tax free for some and offer large leverage, but spend a few hours on google and study leverage and its pros and cons you may change your mind to having a large leverage account, also check out silvanis beat the forex broker book. IG are like many other sb companies they do what they do, arm yourself with knowledge to better understand this, sometimes all the hype of spreadbetting looks glittery but all that gltters is not gold!!
Learn more trade less!

 

[tar]

Without giving to much away, I know someone (not a friend) who trades with IG on a daily basis and makes around £5,000 per day.

He manipulates the share price of a few companies outside of the FTSE 100 that are low priced and have low daily volume.

He uses his share dealing account to gradually buy small positions at various prices on his way to having a large position in the company, he will the place a spread bet with IG in the other direction normally worth a good few hundred pound a point and then pretty much dumps the stock in 1 or 2 off loads while his high leveraged short spread bet rakes in the profit.

He has specific stocks for doing this and which he can manipulate becasue of the low volume and price as well as other factors.

They will get him ...

Day trader who exploited City Index spread betting 'loophole' fined £700,000 - Telegraph

 

[Vasco da Banana]

Spreadbet companies pretty well do the same thing, anyway.

 

[new_trader]

Spreadbet companies pretty well do the same thing, anyway.

I heard that some spread-betting companies drown kittens, for fun.

 

[Sanity]

Funny how individuals get done for this, but the larger banks/funds/corps don't.....

No he doesn't, as you can read the FSA's report. This guy was pretty much doing the samething as the guy I know.

FSA bans and fines self employed trader £700,000 for market abuse

Quote from the report

"Alexander manipulated the prices of shares on the London Stock Exchange by entering multiple small orders to buy and sell shares. The purpose of these orders was to manipulate the price of CFDs and spread bets, which track the price of shares. Alexander generated £629,130 by trading CFDs and spread bets at the prices he created through his share price manipulation, and frequently used CFD and spread betting accounts in the names of third parties to disguise his behaviour. This manipulation of the prices of shares and derivatives at the expense of the firms amounts to market abuse."

 

[Mr Laurence]

Thanks for the feedback.

I am currently now in another situation...

I went in a Sell at 5938 on the FTSE 100 DFB, at £9 per point. At that point my equity was around £258.

Around £4:30pm the FTSE shot up to around a peak of 5962. I received an email around that time telling me about my margins and to deposit my funds.
I get home around 6:30pm to check my account, and see I have a balance of £150 and the position I opened is now at £3 a point, not the £9.

I still had enough fund on my account when it 5962 and there was no need for the lower the money I had on per point. So yea, it's obviously hit the peak and started to drop back in my favour, but where I was paying £9 on the raise, now they've lowered my rate without my knowledge, I was making a 3rd back when it fell back down.

Obviously it was going to drop back after that spike and I feel they knew this too and took action to stop me recouping the losses back.

Now it's dropped all the way back down to 5935 as expected, but I am still significantly down just because they changed my order. I credited another £150 to the account now, but I very unhappy they did this without my consent or sufficient notice.

What can I do about it? Surely I should be protected in some way from such dodgy dealings?

Hi.

You say 'obviously it was going to drop back', but was it? If it had continued to rise you would be going deeper & deeper into the red, then IG would have to get the funds from you. It's hard to accept when you loose a bit, that the whole system isn't just bent on getting your money, but if that was the case, thy would pick on people with much bigger bets and larger balances. You need to decide what you would be happy with, & set a stoploss or limit order whenever you are away from the platform. I prefer trailing stoplosses, & if it moves against me, & then goes back in my favour, I don't make as much as I could, but at least I make something.

If you want to try with smaller bets, try City Index. They allow 50p bets on Ft100 dfb & when that's got a stoploss that leaves you in profit, you can add another bet & keep adding bets & tightening stoplosses until the market reverses. Then your bets will close & you get any profit.
Remember - any day you don't have to add funds - is a good day.