Day Trading & Forex Forum

jel31

Hi there

Anyone looked at IGIndex's new Bungee Bets? Sounds interesting...

Hoggums

interesting but expensive - I don't think these bets represent any kind of value for money as the quotes are shifted firmly in IGs favour.

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shadowninja

I had a look. Not convinced. I noticed the price varies with the bungee you choose, which is annoying. It therefore could be profitable if you are already a good trader.

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Trevor2522

This is just a cynical attempt by IG Index to confuse punters and separate them from their money by promising 'no stopouts'.

Bets are excessively complex to set up: 16 floor or ceiling levels for each cross. Then the spreads are wider than regular spreadbets. And the prices are flagrantly biased in IG's favour.

What a sham! I think they will be quietly dropped once customers desert them.

Just stick to regular spreadbets with a stop and limit.

arabianights

It looks like a combination of a long and a put.... or a short and a call. So basically if vol increases massively then presumably so will the spread.

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r.w.

Those bets are equivalent to portfolio insurance, i.e. long position plus put option or short position plus call option.

The drawback with the Bungee bet is that you have to open both the spot and option position simultaneously, whereas the same protection will be cheaper to buy later, using options, than at position entry - assuming the underlying goes your way initially.

If the underlying doesn't go your way initially, you were simply wrong and an ordinary stop loss would be cheaper protection.

The benefit of the Bungee bet is that both spot and option get closed out at expiry, so the bet makes sense if you intend to leave the position open until expiry - for example if you will be unavailable to close the position manually. Then, again, a limit order and a wider stop would do a good job as well.

Finally, the insurance protection will be cheaper the later in the day you enter the position, as there will be less time premium to pay in the option.

tar

I would like to sneak a peak to some live examples cuz i dont have access to IG platform

forex999

well everyone has an opinion and off course views will differ.
i thought i would test it live! - did a bet on forex yesterday.

one was anormal bet with a stop
and the other was a bungee

guess what, the normal got stopped out , and retraced back heavily in the direction of my original trade! so i made a loss

On my bungee i made a profit
so guess there is a market for everything

so hats of to IG for being innovative
IG Index Zindabad!! LOL