spread betting

I mentioned that I had 2 boys with my first wife-she comes home from work at lunchtime to find the younger of the two has taken his own life 10 days before Christmas.The cause - that little word depression.Such a little word but such a big thing.
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As a father of two young kids, this really turned my stomach when I read it. Although you can never fully get over something like that, I have to admire you for coming through it positively.
Every parents worse nightmare. Not sure how I'd cope.

Well said on everything else too.
 
Destiny....

My first comment is that I dont think a spreadbet account will help you. It will more than likely cause you to take larger positions than you should be taking. You see spreadbetting instruments (indecies etc) offer you a far greater leverage than you will find at any brokerage. This WILL spell disaster unless you have a full tried and tested Money Management Program in place.

From what You have written you have obviously had a rough ride. A big up followed by an even bigger down. You call it bad luck but the facts are that it was probably a foreseeable event. Doubling up of positions and getting squeezed by margain payments are evidence of a trader in danger, not one whose going to make regular money from the markets. I know this may not be what you want to hear right now but sympathy isnt going to get your money back or save You from making the same mistakes again. The only way to is to learn from the mistakes YOU make. No one else can learn from your mistakes and You cant learn from anyone elses mistakes. It's what You experience and learn which will decide if you are a good trader or not.
I would suggest that in the first instance a good direct access US broker is what you require. Someone like IB would be okay for You. Their commissions are low and they are very quick. The platform is easy to use and there are bolt on products available.
You will then be able to access markets at tight spreads. This gives you a massive psychological advantage especially when day-trading. It suddenly becomes much easier to cut losses quickly whilst adding to winners. As someone has already mentioned, far better to turn to spreadbetting once you know you can consistantly turn a profit. Under current CGT rules you can still make upto about £8,000 per year tax free.

Hope this helps,
Steve.
 
Fantastic post Wanderer you have my respect for taking the trouble to write it and for trying to help Destiny.
 
Wanderer,

I add my respect for coming through such experiences and going on to help others.

Destiny,

It's impossible to put an old head on young shoulders - we've all heard it from our elders when we were younger and chosen to ignore ot but there is truly a wealth of experience on this thread.

Good luck
 
destiny said:
in responce (sic) to peedee,
ive been in the markets for 1 year only, well im a student i mean i was.... :cry:
started in jan 03, made £25000 by august, ALL IN SHARES. i was only doing this on the side whilst studying and doing a part time job. i was on top of the world, made big plans, was going to do masters etc. i had plans to forget the markets after hitting a profit of £30000 and going back to it when i graduate.


.
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Well guys personally I see this as similar to the time the legendary J.P Morgan knew how it was time to get out of the market ahead of the great crash- when his shoe shine boy started giving him tips.
A student. Making £25k. Part time. whilst studying. Whilst working part time doing some other job. oh, FFS if this isn't top of the market stuff, i don't know what is.

Luckily I did short the futures yesterday and a Life assurer ( geared plays on the market) now, i feel good!!!
 
Thank to all for your positive coments-nice to know that at least a tiny positive can come out of a tragic event.It has certainly changed by whole perspective on life and if nothing else has given me the ability to realise that the vast majority of what we get stressed about can easily be passed off with a shrug and even a smile. Writing like this is all part of my "self help" therapy and why I feel that it is so important that Destiny keeps up the correspondece.So keep talking to us Destiny-you may not always like what you hear or agree with it but I know for sure that talking things through can be a big help in even the darkest moments.
 
Thank-you all for your replies :D
The Wanderer, reading your story made me think that no matter what happens life goes on, you can pick yourself up, its not all over even though it may seem that way at the time. I'm surprised that I'm actually thinking like this!

I must admit the response I got was overwhelming, the pearls of wisdom I have got I'm digesting slowly, this kind of advice no one can give. I'm sure a lot of people must have benefited from this. Even if someone got paid they would not be arsed to write so much and with so much thought. the advice iIwill always remember and re-read.

A member called Zenda had a word with Clickevents for me, and I actually got a free CD from John Bartlett worth £275!! that has definitely given a smile on my face again.

I've started to look at things in perspective, I'm seeing the light at the end of the tunnel. I can see positive which seemed impossible a week ago. Signing on here is the best thing I could have done. A psychologist wouldn't help for sh**.

In response to some members:
The reason why I'm keen on financial betting is the leverage, not having to tie up huge sums of money. It's true to say why do I want to learn how to trade when I say I could have made a killing, the reason being that the techniques I learnt were for equities, high rise in percentage but not points. in a nutshell, companies whose performance was unacceptable who made very high losses and became undervalued as a result even though they may have more than 3 billion assets. I would look at why they made those losses i.e. delayed orders, subsequent director dealings, performance related to sector, how other companies outlook is etc etc. companies that had really hit rock bottom such as Corus I bought at 6p, Spirent at 12p, Innovation Group at 8p etc. There is very little risk as they have too many assets. I made calculated risks, thats how I got to £25k but then when I started to go for higher priced shares thats where I went wrong. I didn't follow my techniques anymore because of other commitments. Spread Betting is a whole new game.
In response to Citytrader, I was lucky when I picked up the market when it was rock bottom low, most shares were below there NAV per share. although companies weren't going to return to profit within a year but improvements were going to be made, most companies deliberately gave all the bad news that they could possibly give because the directors wanted to buy at these rock bottom prices!. Now things are changing so that technique doesn't work anymore, only for a few. I think the market will carry on going up until the election in the states

I have bought some material such as "the principle of profit" but it is not what im looking for, does anyone know where I can find out info on how different news affects prices, short and long term. whether it be company news or economic news, how to calculate whether a company is undervalued or not i.e. NAV per share. How trade affects share movement, false rallies etc etc

Anyone know a good book on the psychology on trading?

Thanks again for your responses, I will never be able to repay anyone for the advice they have given :D
 
Destiny

Good to hear from you.

I thought long and hard before posting my story and even though I deliberately left out some of the harsher details I wondered if I was doing the right thing.With that in mind it is nice to know that it might help you in some way.

I'll leave others to give you advice on the finer aspects of trading-most of them know more about it than I do but sooner or later I'll get there through the hard work and dedication required.Must remember to take my own advice and keep positive.

That is the key to it all-keep positive even if you have bad times along the way.They are just the little blips along the way just to test your resolve-just see them as challenges to be beaten and not demons that you will allow you to be defeated.


Good luck with it Destiny-take on board the advice you will get here and elsewhere pick out the best bits and try to tailor them to your own personality.Always be prepared to take a long hard look at yourself from time,being honest about your strengths and weakness.I know it sounds basic and to some extent naff but then it's a question of building on the strengths and doing your best to eliminate the weaknesses or at least ensuring that they do not cause you too much damage.

Once again all the best
 
Destiny,

A good book to read on trading psycology is Mark Douglas 'The Disciplined Trader' or 'Trading In The Zone'.

Something you need to understand is that to become a good trader (not just a lucky one) requires the ability to identify LOW RISK TRADES, not ones that will make a great profit if they come good.

I can't advise on your situation but if I were in a similar situation I'd have a break from trading a while then start back paper trading part time while finding method of trading that suited me and worked reliably. Once this was accomplished I'd start with a small amount of capital and work up from there.

Hope this helps,
Pete.
 
ive learnt that money management is the most important for a trader. I really didn’t have no money management at all, if I did then I wouldn’t start of with my student load money and student back overdrafts!i didnt keep track of trades sometime trading over 3 trades in a day. That’s where psychology affects people more, if you are rich and its money on that side then it would affect you very little, but playing with debt I admit was stupid even though I was very confident. thats something someone whould not do, start small and only invest what you can loose. I was chasing the losses and making opportunities. I can see more positive from this that at a young age I have learnt a big lesson, many traders find out when they are much older. Possibly brighter future ahead.It has given me hunger to learn more. ive decided in this and coming week i will do research and make things black and white which are now gray. so i may ask alot of questions but only for a week or so.

a few systems i looked all concentrate on trend following, known as the technical trader. im really not that interested in that yet, that you learn with experience. im more interested in the fundemental trader. anyone know good books on that? i.e. analysis of company balance sheet etc

ive also noticed that these system show no reference external influences such as news, may it be specific or not. anyone know good books on how external influences affect equities? how different news affect prices.

also in shares that are dealt in AIM especially, how without any trade shares double!? how there are false rallies, why shares go down even when there is buys of more then 40 mil ! things like that have never made sence to me, id be greatfull if someone can shed some light on that or any books that can. thankyou.
 
Aviod AIM shares and penny shares like the plague. They are mostly pure speculation. The wide spreads and low volumes will ( can) destroy you if you get it wrong.
 
If you know what you are doing, fine.
If you have money to lose, fine.
If you know the risks,fine
If you know the rewards, fine.
Otherwise, don't.
There are those that can and do make fantastic returns. There are those that lose the lot. We all ( experienced) know that. Some people don't know the facts and need to be guided. A beginner does not need , or deserve, a baptism of fire.
I know. That's how I lost my first wad.
 
and I bet many more lost money playing penny shares than made money
 
neil,

More people lose money trading than make it anyway, it is not specific to penny shares.



Paul
 
hi
i cant get my head round why we spread bet when we can have E-mini Stock Index Futures? what is the fundamental difference between the two?
 
destiny said:
follow my techniques anymore because of other commitments. Spread Betting is a whole new game.
In response to Citytrader, I was lucky when I picked up the market when it was rock bottom low, most shares were below there NAV per share. although companies weren't going to return to profit within a year but improvements were going to be made, most companies deliberately gave all the bad news that they could possibly give because the directors wanted to buy at these rock bottom prices!. Now things are changing so that technique doesn't work anymore, only for a few. I think the market will carry on going up until the election in the states

I have bought some material such as "the principle of profit" but it is not what im looking for, does anyone know where I can find out info on how different news affects prices, short and long term. whether it be company news or economic news, how to calculate whether a company is undervalued or not i.e. NAV per share. How trade affects share movement, false rallies etc etc

:D
Click to expand...

Many sectors permanently trade at a discount to NAV - it's not a normally use Fundamental analytcal tool. But well done if it worked for you, all be it for the wrong reasons!
 
Destiny,

I found your story interesting so I just had to offer my contribution with the hope things work out for you.

Let's see, you lost 10K of your own money plus interest in 1 year. That I'm afraid is the high cost of the education. And it's only the beginning. Scared. You should be.
I've seen some good advice here. Trading education also means pain and you've experienced that. Now you've attended the first year in trading college. Welcome to the club.

You've had the lectures by learning first hand, but what have you learnt. Seems to me you have paid for the education, but you're going to flunk out in the finals because you still haven't learnt.

So you are going to use leverage by spread betting or horse betting or trading futures. Well, think of it this way. Do you seriously think you're going to succeed by jumping from the one area where you took the lectures into a different class of which you know little. Get real. Sorry.

One of the lessons you should have learn from the experience is not to trade with money you need for living. You were basically undercapitalised and you know it. Want to make the same mistake again and expect different results!!

Let's see if I get this right. You were at Uni. Why did you go in the first place. Is it your intention to use trading to finance your education. I have a better idea. Get a job if you can and don't give up on getting the qualifications you originally planned.

Sure, do what you're doing now as well. research and read about trading. In your spare time. Then when you're capatilized sufficiently, you won't have to pay for the first year of your trading education again. And you will be trading with a big advantage because you won't be pressed to close out winning positions early just because you need the money.

Hey, I don't want to depress you. I want to enlighten you. If it hadn't happened to you when it did, be assured it would most probably have happened later.

So here's some advice for some of your spare time. Read wyckoff, look up on the web bet size for money management and use a free tool to paper trade in your spare time using different loss management (i.e. stop placement) and money management strategies. There's also a book, Reminiscences of a stock market operator for light reading.

One positive thing you have going for you is incorporating the fundamental research. That will help you to select stocks, but technical analysis will help you to time the move to get you in on the right side of the market. Be also very careful of those How to books and trading courses. Do some research into who's writing it. And some of those questions you're asking about how news affects prices shows you're asking the right questions so when you do start trading again, the odds will be on your side. And that's what you need to win.
 
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