best online broker for scalping the Dow (or FTSE etc.)?

It's easy to make imaginary money scalping the Dow using a City Index demo account. Not by having access to properly live prices and capitalising on discrepancies. Just by using your bonce, usually getting in and out in 5-30 seconds, occasionally hanging around for a minute or two. Their spread on the Dow is only 1 point. It's easy on say 30 trades a day to triple your money in a year. Shame there's a catch!

The catch of course is that if you try it using a live account, you'll get put on "dealer confirm" as fast as greased lightning. You'll get slow fills when the market's against you, and slippage with your stops, and no, sorry, they won't let you walk away with lots of money for your efforts. What you make, they lose.

Not so with a DMA firm. OK so my question is: what's the best place to scalp the Dow, or indeed the FTSE? Starting with a bankroll of £20K and staking £15-£25 a point 30 times a day.

Ideally where you can open a demo account first, and where all charges and costs are totally transparent and you don't have to spend a few minutes calculating them for each trade (which would make the trading strategy impossible).

I've heard of prospreads.com, who offer some version of DMA trading in an SB wrapper. Are they any good? What spreads are available on the Dow and FTSE for scalpers using the above sort of strategy and with a bankroll, stake size, and trading rate as above? What other firms are there?

(I haven't studied the FTSE, but my strategy probably wouldn't work with a spread of more than 2 points on the Dow).

Thanks!

John

Hi, thanks to D who PMed - I've put Alexander David on my list and will have a good look at their IG CFD DMA offering.

The main thing I'm studying at the moment is IB with ButtonTrader, which a lot of scalpers rave about, but so far I haven't been able to get much joy with it. I downloaded the demo version (8.00.56.3). Don't all jump on me, but I prefer the City Index SB interface, even though I won't be using either CI or any other SB!

My strategy involves doing nothing during volatility spikes, which on the Dow seem to come at an average of 5-15 minutes apart; watching for trading ranges of about 8 points, and when there's a tiny jump outside of that range, staking on a reversal; and then scalping off a few points, usually within 5-30 seconds. I've been using guaranteed stop losses about 8 points away. The system obviously needs further improvement, but it's been working fine at CI, with 30 trades per day.

What I like about the CI interface is

1) the spread is clearly shown, and the moment there's a jump outside of the range you're looking at, you can get in there. Obviously if you did this for real, you'd get hit with slow fills etc. and it wouldn't work, but the interface is ideal. Therefore if possible I'd like DMA but in an SB wrapper. I'll prob use level 2 later, but for the moment I want to work on the system without level 2.

2) the candlestick graphs. All I've managed to get with BT is candles without wicks and they're too thick and move too quickly. At CI you can use 1-minute candles and the gaps between them horizontally make them easier to take stock of - for me, anyway.

3) volatility indicator showable on same screen as candlestick graphs

4) stop loss set up, then in you go with one click

I think what I need is DMA (with ECN), and that I should be able to get the necessary using IB and BT, but haven't been able to get it off the ground using the system I'm working on. All advice would be very welcome.

Lastly - where can I get historical data for the Dow, usable with the BT simulator or similar? Even a couple of days' worth would be great.

John

Try Interactivebrokers.co.uk

neil said:

Try Interactivebrokers.co.uk

Click to expand...

Thanks for this. Have downloaded their WebTrader manual, which I'm ploughing through. Can you advise as to software I could use if I want to write a bot and leave it to apply my strategy on past data, factoring in IB commission etc.?

Also, is there any advantage of Trader Workstation over WebTrader, and would I need some kind of plug-in to be able to write and run the bot?

Cheers!
John

I can recommend you to take a look to :

FinFx
ATC Brokers
MB Trading

I know this brokers have good reputation.

Your technique is exactly what im working on, i have been using IG Index as they have a 1pt Spread 8am - 4:30pm on FTSE 100, if i choose my trades carefully i can make money and again its simply taking advantage of volatility, i have only been doing on average between £2-5 per point, but i think that if i got it down to a T then i'd be on call, although from what i have learned IG are much less likely to put you on call than World Spreads (who offer zero spread) and the likes of City Index, Capital Spreads etc.

Like you my trades are very short, often a few minutes max for best results from 1 min and 5 min candles... there is a journal on here of a guy who's using http://www.openecry.com/ they seem extremely good, but i have not even got my demo fired up for sure to can not comment, here's the deal each 'batch' works out at £10 per point, and it costs £1.29 per trip, so £2.58 per trade

The main benefit with this, is that it works out cheaper than a spread bet and as far as im aware you'll never be on call!

Getting put on call for making money is ridiculous! Especially when 90% lose.

Doomberg said:

Your technique is exactly what im working on, i have been using IG Index as they have a 1pt Spread 8am - 4:30pm on FTSE 100, if i choose my trades carefully i can make money and again its simply taking advantage of volatility, i have only been doing on average between £2-5 per point, but i think that if i got it down to a T then i'd be on call, although from what i have learned IG are much less likely to put you on call than World Spreads (who offer zero spread) and the likes of City Index, Capital Spreads etc.

Like you my trades are very short, often a few minutes max for best results from 1 min and 5 min candles... there is a journal on here of a guy who's using http://www.openecry.com/ they seem extremely good, but i have not even got my demo fired up for sure to can not comment, here's the deal each 'batch' works out at £10 per point, and it costs £1.29 per trip, so £2.58 per trade

The main benefit with this, is that it works out cheaper than a spread bet and as far as im aware you'll never be on call!

Getting put on call for making money is ridiculous! Especially when 90% lose.

Click to expand...

dont forget the market spread on top

Whats the market spread with them? I had a chat with them, but missed this?

Doomberg said:

Whats the market spread with them? I had a chat with them, but missed this?

Click to expand...

usually half a point on ftse

trader-john said:

I can recommend you to take a look to :

FinFx
ATC Brokers
MB Trading

I know this brokers have good reputation.

Click to expand...

be so kind

provide any information possible about finfx

currently running demo is fine

but reliability of company is a bit doubtful

cos finland has no regulation of brokerages as i know

your advice would be precious

thanks in advance and lucky trading

johnnn said:

It's easy to make imaginary money scalping the Dow using a City Index demo account. Not by having access to properly live prices and capitalising on discrepancies. Just by using your bonce, usually getting in and out in 5-30 seconds, occasionally hanging around for a minute or two. Their spread on the Dow is only 1 point. It's easy on say 30 trades a day to triple your money in a year. Shame there's a catch!

The catch of course is that if you try it using a live account, you'll get put on "dealer confirm" as fast as greased lightning. You'll get slow fills when the market's against you, and slippage with your stops, and no, sorry, they won't let you walk away with lots of money for your efforts. What you make, they lose.

Not so with a DMA firm. OK so my question is: what's the best place to scalp the Dow, or indeed the FTSE? Starting with a bankroll of £20K and staking £15-£25 a point 30 times a day.

Ideally where you can open a demo account first, and where all charges and costs are totally transparent and you don't have to spend a few minutes calculating them for each trade (which would make the trading strategy impossible).

I've heard of prospreads.com, who offer some version of DMA trading in an SB wrapper. Are they any good? What spreads are available on the Dow and FTSE for scalpers using the above sort of strategy and with a bankroll, stake size, and trading rate as above? What other firms are there?

(I haven't studied the FTSE, but my strategy probably wouldn't work with a spread of more than 2 points on the Dow).

Thanks!

John

Click to expand...

I understand Prospreads will probably be opening up to retail clients later this year.