Zero Spread WorldSpreads

[JSMITH07611]

Anyone know when we get our deposits back?

you will have to wait at least a year. for proof just look at customers from mfglobal still waiting for their money.

The reason is that administrators kmpg take as long as they can so that they can claim they spent more time on it and get more money. Im not even sure who is more corrupt worldspreads or kmpg. for proof telephone up kmpg and ask how long it has previoulsy taken for clients to recieve money from other organisations who went bust (don't ask anything about worldspreads they will just tell you i don't know or as soon as possible- nonsense) look at a website called worldspreadsheist blogspot for more info.

 

[JSMITH07611]

well you see now why they offered it

so that you deposit 5k

then they do ponzi scheme

moneys now gone

worldspreads bankrupt

the proof it was a ponzi

firstly why did they require £5000 for zero spreads only because they were planning on going bust

secondly why did they need about 25 white label websites only to get as many customers and there money - you can see the list here FSA Register other brokers just have about one or two white lables

thirdly how come the boss resigned the day beforehand of course ponzi he runs off with his money

fourthly the guy conor foley (the ceo)is definitley irish in saying he had no idea about the issue he just happened to resign The brains of an irish man thinking people will believe him

fifthly they were legally required to segregate funds which they deliberately stole

I CHALLENGE ANYONE TO SAY THAT THIS WAS AN HONEST COMPANY

 

[JSMITH07611]

also by the way look at this link to find out what mr conor was really like

This is the story of Conor Foley and WorldSpreads

 

[Ross Spur]

also by the way look at this link to find out what mr conor was really like

This is the story of Conor Foley and WorldSpreads

Like the bit at the end, which says he's 'learning to fly'. A skill fully-mastered now, apparently.🙂

 

[stevespray]

Like the bit at the end, which says he's 'learning to fly'. A skill fully-mastered now, apparently.🙂

This bit in particular made me laugh (when we consider Mr Foley's statement denying knowledge from Monday)....

"Mr Foley believes one of the factors in the group's ability to reinvent itself has been its simple corporate structure. 'From the start, everything was transparent - there were no funnies, no offshore entities, no part-owned businesses. It also made the flotation in 2007 a hell of lot easier.' "

 

[alphadude]

my $0.02 on SB:

i have been working for 2 brokers for more than 10 years; and here is the business model of SB companies:
- they rely on statistics; and the law of large numbers: 95% of retail punters lose money in the market.
- they profit from losing trades. they are on the other side of the trade; i.e. your counter party
- some SBs profit from both; the spread itself; and being the other side of the losing trades. In the case of WS; they decided to offer zero spreads; because they can still make money from losers.
- profitable traders are not welcome in their platforms; and hence the "dealer referral"; is to slow you down; and wait until your trade turns onto a loser; and then trade it
- if they rely purely on statistics; and let losers lose and winners win; they can still make money because majority of punters lose money; however WS are as greedy as anybody else; they can't wait; but kick out profitable traders out of the game.
- In other words; these guys operates like Mafias.

Professional traders will never ever use SB companies. If any pro in this forum benefited from SB; come forward!!!

my advice to you guys is;
- trade with a broker that sends your order to the market. i.e. your order executes on the exchange; and settles on the exchange. The exchanges are setup to guarantee delivery of goods; even if the counter party defaults.
- avoid brokers with conflict of interest. i.e. brokers who market make your orders. you will be surprised to know that majority of all brokers in FX markets have conflict of interest with you. Let me spit them out: OANDA, FXCM, DurasCopy, Alpari, IBFX...etc.
The only broker that has absolutely no conflict of interest; and trades your orders on the exchange; is my beloved broker: Interactive Brokers.

-

 

[The Leopard]

my $0.02 on SB:

i have been working for 2 brokers for more than 10 years; and here is the business model of SB companies:
- they rely on statistics; and the law of large numbers: 95% of retail punters lose money in the market.
- they profit from losing trades. they are on the other side of the trade; i.e. your counter party
- some SBs profit from both; the spread itself; and being the other side of the losing trades. In the case of WS; they decided to offer zero spreads; because they can still make money from losers.
- profitable traders are not welcome in their platforms; and hence the "dealer referral"; is to slow you down; and wait until your trade turns onto a loser; and then trade it
- if they rely purely on statistics; and let losers lose and winners win; they can still make money because majority of punters lose money; however WS are as greedy as anybody else; they can't wait; but kick out profitable traders out of the game.
- In other words; these guys operates like Mafias.

Professional traders will never ever use SB companies. If any pro in this forum benefited from SB; come forward!!!

my advice to you guys is;
- trade with a broker that sends your order to the market. i.e. your order executes on the exchange; and settles on the exchange. The exchanges are setup to guarantee delivery of goods; even if the counter party defaults.
- avoid brokers with conflict of interest. i.e. brokers who market make your orders. you will be surprised to know that majority of all brokers in FX markets have conflict of interest with you. Let me spit them out: OANDA, FXCM, DurasCopy, Alpari, IBFX...etc.
The only broker that has absolutely no conflict of interest; and trades your orders on the exchange; is my beloved broker: Interactive Brokers.

-

There are 2 DMA spreadbet companies that I'm aware of - ibetfinancials and FP Markets.

 

[alphadude]

There are 2 DMA spreadbet companies that I'm aware of - ibetfinancials and FP Markets.

problem is; as a client; your counter party is not the Exchange; even with DMA; but rather the SB company; which means you are not covered. SB companies deal on client orders. they may send some orders to the market and may not; depending on their trading strategies. these strategies are known as "inventory trading".

The bottom line is; the fact a company call itself "spreadbetting" it really means you are trading a derivative of the underlying; and that is trouble.

SBs claim to hedge client orders with the underlying; but doing that incurs huge bill and render the business case worthless. Behind the scenes these companies will not hedge; and pray on losing punters. they will also drive profitable clients out of their platform one way or another to keep the money machine rolling.

these companies do not last; and will end up in tears sooner or later. Look at MF Global, WS, Lehman and many others disappeared and with client money.

The safest way to trade profitably is to trade the markets on the exchanges.

Hedge Funds are well aware of this. they have a term for it "Counter Party Risk". Even when they trade on the exchange; the broker have to have the right balance sheet to make sure they won't end up with the administrators. let alone if that broker or SB is not trading on the exchange.

 

[The Leopard]

Those two claim (very publicly) that they automatically pass every single order through to the relevant exchange, and that they cannot profit from client losses. This is essentially meant to be the USP that distinguishes them from the usual SB companies.

This is different to Prospreads for example which offers "DMA functionality" and admits that it doesn't automatically place order for order with the exchange.

Are you saying that FP and ibf are lying about their claims?

problem is; as a client; your counter party is not the Exchange; even with DMA; but rather the SB company; which means you are not covered. SB companies deal on client orders. they may send some orders to the market and may not; depending on their trading strategies. these strategies are known as "inventory trading".

The bottom line is; the fact a company call itself "spreadbetting" it really means you are trading a derivative of the underlying; and that is trouble.

SBs claim to hedge client orders with the underlying; but doing that incurs huge bill and render the business case worthless. Behind the scenes these companies will not hedge; and pray on losing punters. they will also drive profitable clients out of their platform one way or another to keep the money machine rolling.

these companies do not last; and will end up in tears sooner or later. Look at MF Global, WS, Lehman and many others disappeared and with client money.

The safest way to trade profitably is to trade the markets on the exchanges.

Hedge Funds are well aware of this. they have a term for it "Counter Party Risk". Even when they trade on the exchange; the broker have to have the right balance sheet to make sure they won't end up with the administrators. let alone if that broker or SB is not trading on the exchange.

 

[ChocolateDigestive]

my $0.02 on SB:

i have been working for 2 brokers for more than 10 years; and here is the business model of SB companies:
- they rely on statistics; and the law of large numbers: 95% of retail punters lose money in the market.
- they profit from losing trades. they are on the other side of the trade; i.e. your counter party
- some SBs profit from both; the spread itself; and being the other side of the losing trades. In the case of WS; they decided to offer zero spreads; because they can still make money from losers.
- profitable traders are not welcome in their platforms; and hence the "dealer referral"; is to slow you down; and wait until your trade turns onto a loser; and then trade it
- if they rely purely on statistics; and let losers lose and winners win; they can still make money because majority of punters lose money; however WS are as greedy as anybody else; they can't wait; but kick out profitable traders out of the game.
- In other words; these guys operates like Mafias.

Professional traders will never ever use SB companies. If any pro in this forum benefited from SB; come forward!!!

my advice to you guys is;
- trade with a broker that sends your order to the market. i.e. your order executes on the exchange; and settles on the exchange. The exchanges are setup to guarantee delivery of goods; even if the counter party defaults.
- avoid brokers with conflict of interest. i.e. brokers who market make your orders. you will be surprised to know that majority of all brokers in FX markets have conflict of interest with you. Let me spit them out: OANDA, FXCM, DurasCopy, Alpari, IBFX...etc.
The only broker that has absolutely no conflict of interest; and trades your orders on the exchange; is my beloved broker: Interactive Brokers.

-

Good post. Don't think interactive brokers have no conflict of interest. I don't know about FX but in equities they are huge market internalisers. Google market internalisation.

 

[Ross Spur]

Those two claim (very publicly) that they automatically pass every single order through to the relevant exchange, and that they cannot profit from client losses. This is essentially meant to be the USP that distinguishes them from the usual SB companies.

This is different to Prospreads for example which offers "DMA functionality" and admits that it doesn't automatically place order for order with the exchange.

Are you saying that FP and ibf are lying about their claims?

If FP and IBF really have a 100% fully automatic hedge, how do they make enough profit on SB for it to be viable? They'll need thousands of clients making thousands of trades, and where do they come from, when the effective commissions are much higher than you'd get from a futures broker?

 

[The Leopard]

If FP and IBF really have a 100% fully automatic hedge, how do they make enough profit on SB for it to be viable? They'll need thousands of clients making thousands of trades, and where do they come from, when the effective commissions are much higher than you'd get from a futures broker?

Well, you'll have to ask them. 🙂

But futures brokers make money. These (apparently) are just the same, but they charge a higher commission. All they are really doing in effect is providing a spreadbet wrapper, otherwise (so they claim) they are simply acting in the same way as any futures broker. In return for the spreadbet wrapper you pay higher commissions.

As for customers, I guess anyone who prefers to pay a couple of dollars per round trip extra rather than pay tax.

 

[Ross Spur]

Well, you'll have to ask them. 🙂

But futures brokers make money. These (apparently) are just the same, but they charge a higher commission. All they are really doing in effect is providing a spreadbet wrapper, otherwise (so they claim) they are simply acting in the same way as any futures broker. In return for the spreadbet wrapper you pay higher commissions.

As for customers, I guess anyone who prefers to pay a couple of dollars per round trip extra rather than pay tax.

As I understand it, a DMA SB is taxed in way that wipes out a lot of the profit. Hence the wide spreads, which make it far less attractive to those who trade lots of times on short time frames. You have to make a profit before you worry about paying tax.

 

[The Leopard]

As I understand it, a DMA SB is taxed in way that wipes out a lot of the profit. Hence the wide spreads, which make it far less attractive to those who trade lots of times on short time frames. You have to make a profit before you worry about paying tax.

I believe that they are subject to the standard betting levy, which (if memory serves) is 3% of net client losses, calculated monthly. They are of course also subject to all the normal taxes as well, like any business.

With this model, there are no wide spreads (we are not talking about the likes of Prospreads here). The spread is the spread, whatever that might be. ES, 1 tick etc. They simply charge a higher commission than a standard futures broker.

Your point is absolutely correct of course, but I suspect many bigger futures traders would be better off paying higher commissions and no tax. Each to his own, of course, but I wouldn't be surprised to see this model becoming more widespread, with regular brokers offering the same service alongside their existing operations.

 

[alphadude]

Good post. Don't think interactive brokers have no conflict of interest. I don't know about FX but in equities they are huge market internalisers. Google market internalisation.

Internalisers are a feature that traders want. Surely it benefits IB in exchange fees savings; but it's a win/win.

I particularly likes IB internaliser in FX. I have seen many of my trades execute on IB internalizer on narrower spreads compared to other broker quotes.

As long as the internaliser match client orders; it's a good one to have. The conflict of iterest arises when the broker becomes the counter party on your trades.

IB does not do that. all you trades are executed against other client trades (non-affilicated with IB).

 

[DJS1]

my $0.02 on SB:

i have been working for 2 brokers for more than 10 years; and here is the business model of SB companies:
- they rely on statistics; and the law of large numbers: 95% of retail punters lose money in the market.
- they profit from losing trades. they are on the other side of the trade; i.e. your counter party
- some SBs profit from both; the spread itself; and being the other side of the losing trades. In the case of WS; they decided to offer zero spreads; because they can still make money from losers.
- profitable traders are not welcome in their platforms; and hence the "dealer referral"; is to slow you down; and wait until your trade turns onto a loser; and then trade it
- if they rely purely on statistics; and let losers lose and winners win; they can still make money because majority of punters lose money; however WS are as greedy as anybody else; they can't wait; but kick out profitable traders out of the game.
- In other words; these guys operates like Mafias.

Professional traders will never ever use SB companies. If any pro in this forum benefited from SB; come forward!!!

my advice to you guys is;
- trade with a broker that sends your order to the market. i.e. your order executes on the exchange; and settles on the exchange. The exchanges are setup to guarantee delivery of goods; even if the counter party defaults.
- avoid brokers with conflict of interest. i.e. brokers who market make your orders. you will be surprised to know that majority of all brokers in FX markets have conflict of interest with you. Let me spit them out: OANDA, FXCM, DurasCopy, Alpari, IBFX...etc.
The only broker that has absolutely no conflict of interest; and trades your orders on the exchange; is my beloved broker: Interactive Brokers.

-

Totally agree with pretty much everything you say, nice to see someone on here who actually has experience working in the industry and who tells it exactly how it is.....

Personally a broker who sends and executes your trades to market is paramount, as you just can't trust a market maker not to do everything you highlighted above.

As for Pro's spread betting, there are new brokers coming onto the scene offering DMA SB (FP Markets, IBet & ProSpreads though ProSpreads aren't actually DMA as they don't hedge all trades and as far as I can tell IBet only cover futures rather than equities, FX etc). DMA SB is definitely the way forward

 

[The Leopard]

DMA SB is definitely the way forward

Let's hope so. I'm amazed IG hasn't launched the facility alongside its traditional bucket shop operation.

More competition is needed, although in fairness FP seem to have at least a reasonable cost structure in place (it still needs to be lower, and I'm sure it could be).

 

[DJS1]

problem is; as a client; your counter party is not the Exchange; even with DMA; but rather the SB company; which means you are not covered. SB companies deal on client orders. they may send some orders to the market and may not; depending on their trading strategies. these strategies are known as "inventory trading".

The bottom line is; the fact a company call itself "spreadbetting" it really means you are trading a derivative of the underlying; and that is trouble.

SBs claim to hedge client orders with the underlying; but doing that incurs huge bill and render the business case worthless. Behind the scenes these companies will not hedge; and pray on losing punters. they will also drive profitable clients out of their platform one way or another to keep the money machine rolling.

these companies do not last; and will end up in tears sooner or later. Look at MF Global, WS, Lehman and many others disappeared and with client money.

The safest way to trade profitably is to trade the markets on the exchanges.

Hedge Funds are well aware of this. they have a term for it "Counter Party Risk". Even when they trade on the exchange; the broker have to have the right balance sheet to make sure they won't end up with the administrators. let alone if that broker or SB is not trading on the exchange.

The brokers offering DMA SB are technically the counterparty to the trade, but because everything is automatically hedged, there are no conflicts of interest.

 

[DJS1]

Let's hope so. I'm amazed IG hasn't launched the facility alongside its traditional bucket shop operation.

More competition is needed, although in fairness FP seem to have at least a reasonable cost structure in place (it still needs to be lower, and I'm sure it could be).

Likewise, but with these new brokers coming onto the scene offering DMA, it's only a matter of time before the likes of IG start to offer it...

IMO when there's a choice between DMA or bucket shops like CMC/CS etc etc etc, DMA gets my vote everyday of the week...

I use FP myself, their rates are competitive enough though yes, as always, lower costs are always welcome!! I prefer to pay that little extra, safe in the knowledge no shenanigans are going on behind the scenes

 

[alphadude]

As for Pro's spread betting, there are new brokers coming onto the scene offering DMA SB (FP Markets, IBet & ProSpreads though ProSpreads aren't actually DMA as they don't hedge all trades and as far as I can tell IBet only cover futures rather than equities, FX etc). DMA SB is definitely the way forward

i still struggle with the DMA SB.

in principle; i will stay away 100 miles from SB; whether they are DMA or not. why would an SB do DMA?. Personally i haven't had any experience with FP Markets, IBet and ProSpreads; but the fact that they call themself Spread Betters; it's a signal for trouble.

I simply trade with brokers; who call themselves ECNs; meaning they don't do market making with client orders at all.

Take for example FXCM; who are an FX broker. I did trade with them for few months; and I did see horrible stuff happening to my orders. all orders goes through the dealing software; and they DEFINITELY dont send your order to the market. They probably hedge the net positions across many clients.

So my golden rule; stay away from any SB or broker who does not do 100% DMA.

few hints: MT4 (MetaTrader software) is designed primarely for these SB or brokers who deal your orders. Until todate; ALL MT4 brokers; deal with your orders. There are a couple of brokers who claim to have developed software to link MT4 servers directly to their trading engine (i.e. OANDA); but guess what; their trading engine is an inhouse dealing software.

It's all crap I can tell you.

I challenge these brokers (SBs and the like who deal) to come forward to this forum and prove otherwise; or at least falsify the facts presented here.