Using a GSL for a 100k short position ?

This is a discussion on Using a GSL for a 100k short position ? within the General Trading Chat forums, part of the Reception category; Originally Posted by shortsell of course, equity clients who swing £5-10m notional per position are traditionally a bunch of toothless ...

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Old Jan 14, 2011, 2:14pm   #11
Joined Oct 2006
Re: Using a GSL for a 100k short position ?

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Originally Posted by shortsell View Post
of course, equity clients who swing £5-10m notional per position are traditionally a bunch of toothless halfwits aren't they?

your lack of knowledge is transparent as it is embarrassing.
Er...Mike Ashley ring a bell?

http://www.dailymail.co.uk/news/arti...-HBOS-bet.html
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Old Jan 14, 2011, 2:17pm   #12
Joined Sep 2008
Re: Using a GSL for a 100k short position ?

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Originally Posted by shortsell View Post
what do you think a major spread betting firm charges for being long a UK stock overnight?
OK, how much?

Peter
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Old Jan 14, 2011, 2:19pm   #13
Joined Oct 2006
Re: Using a GSL for a 100k short position ?

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OK, how much?

Peter
Cant tell you, GW Bush banned you all from this spreadbetting lark.
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Old Jan 14, 2011, 2:19pm   #14
Joined Apr 2006
Re: Using a GSL for a 100k short position ?

oh i see pboyles, you're the sort of guy who uses one example out of a million trades to prove your point.

in which case there's not a great deal of point in engaging you in conversation.

i would encourage anyone reading this to ignore pboyles' contributions with regard to the spread betting industry. he doesn't understand the product in the slightest.
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Old Jan 14, 2011, 2:19pm   #15
Joined Sep 2009
Re: Using a GSL for a 100k short position ?

leonarda started this thread I agree with shortsell,
but lets get back to my question...

with a standard stop you theoretically are exposed to say a 500% loss in a 0.001% chance scenario (guess!!), and especially when dealing with a large position that could take longer to unwind if there's liquidity problems.
with a GSL you'd be exposed to say a 10% loss, but you pay an extra 1% charge every trade...

so taking my guestimates, and say 100 trades per year:
SSL: 500% loss that will probably never happen!
GSL: Extra 100% charge per year, so in 5 years of short selling you're in the same position. So say short selling 1 year out of 4, that's 20 years of trading and you're in the same position.

To me the only difference is peace of mind and happiness/comfort with your risk level when using a GSL.

oh I don't know...but that's why i'm asking the question...
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Old Jan 14, 2011, 2:21pm   #16
Joined Apr 2006
Re: Using a GSL for a 100k short position ?

pete, typically most charge 2.5% over 1 month libor. obviously guys position trading size aren't going to be on 2.5% - in my experience 1.5-2% is closer to the norm.

pboyles, any thoughts on how this compares to leverage costs with a DMA broker?
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Old Jan 14, 2011, 2:25pm   #17
Joined Apr 2006
Re: Using a GSL for a 100k short position ?

leonarda it's basically like house insurance. it's not a value trade - which is why insurance companies make money (over-simplified i know, but you get the gist). so from a value point of view, it's a no. from a sleep easy point of view - only you know the value of your sleep!
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Old Jan 14, 2011, 2:25pm   #18
Joined Sep 2008
Re: Using a GSL for a 100k short position ?

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Originally Posted by shortsell View Post
pete, typically most charge 2.5% over 1 month libor. obviously guys position trading size aren't going to be on 2.5% - in my experience 1.5-2% is closer to the norm.

pboyles, any thoughts on how this compares to leverage costs with a DMA broker?
ok, question since I'm in US and I don't know....Does the sb firm charge for overnight positions even if you are not leveraged?

Peter
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Old Jan 14, 2011, 2:26pm   #19
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Re: Using a GSL for a 100k short position ?

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Originally Posted by shortsell View Post
oh i see pboyles, you're the sort of guy who uses one example out of a million trades to prove your point.

in which case there's not a great deal of point in engaging you in conversation.

i would encourage anyone reading this to ignore pboyles' contributions with regard to the spread betting industry. he doesn't understand the product in the slightest.
You are rather touchy about this criticism, can I ask if you are by any chance involved with a spreadbetting company?
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Old Jan 14, 2011, 2:28pm   #20
Joined Apr 2006
Re: Using a GSL for a 100k short position ?

yes they do pete - but then they suffer funding costs with their underlying brokers on the value of their notional too - without discounting cash on deposit. it's pretty much industry average over here in my experience.
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