Have only just read this thread and was interested with some of the comparisons with horse racing and casino's.
Firstly, at the end of the day, the often quoted 90%+ of those who fail at spread betting/ trading don't fail because the spread betting company rip them off generally, they fail because 90+% of traders using any trading instrument, be it stocks, futures, fx etc fail full stop. The fact that SB companies make money out of this makes little difference. Sure, they have wider spreads than some other methods around but stop running etc goes on in every type of trading. It may be harder to make money out of SB's than equivalent instruments with lower spreads but if the 90+% failure rate applies to traders generally as commonly suggested, then the fault has to lie with the individual themselves?
Experienced traders who start off spreadbetting and make a go of it often seem to progress to other methods of trading which can improve profitability due to lower spreads, faster execution, better service etc. But, if you blow your sb account, chances are you will blow "real" trading account.
In my opinion, trading is a form of gambling. I prefer to call it speculation. The differential for me is that when you place a bet on a horse or on a roulette wheel, the odds are stacked against you so in the long run, the bookie or casino will win. This is gambling.
In trading, you have to find a method. One which gives you an edge so that over a large number of trades, you come out on top.
In order to consistently trade using an edge, you have to define rules. You have to set the rules of your own game. You then have to stick to them.
The great thing about trading imo is that you can create your own unique "game". You pick your own trading instrument from an arsenal of 100's or 1000's of possibilities. You then work to create your own set of unique rules that no one else knows as well as you. If you stick to those rules and continue to tweek them to make sure they keep working, you are playing a game against thousands of others and only you know the exact rules!
Over a large number of trades, as long as your rules are sound and you have a genuine edge you will win more than you lose at your own game.
In other words, if you can do this, you put yourself in the position of the casino or the racing bookie, rather than the mug punter who has the odds stacked against him and will most probably lose his shirt after maybe having a few lucky wins ie the gambler. These people exist in racing, casino's and trading (ie the 90+%).
Thats the theory, the practice is of course much harder. How do you know if you have an edge in the first place? If you think you have one, how do you know it will continue working? If you hit a losing streak, is it a losing streak or has it stopped working? Are you psycholigically able to continue trading through a losing streak?
These are all issues that affect anyone attempting trading, whether SB's, stocks, indices fx or anything else imo.
Basically what I am saying is that whether a consistently winning trader or a consistently losing trader, the responsibility lies with the individual rather than the trading instrument. After all, if you took a winning trader who trades stock index futures for example, they could probably devise a method to profitably spreadbet too?
