Using a GSL for a 100k short position ?

pboyles · Jan 14, 2011, 8:04am

Quote:

Originally Posted by shortsell

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.

You know that FX brokers also manipulate spreads and even change their margin levels to rip people of?

shortsell · Jan 14, 2011, 8:07am

did you know that some footballers dive?

there are any number of completely irrelevent issues we can discuss whilst the market is quiet, but really we should concentrate on the one at hand - namely your belief that a serious investor in stocks shouldn't be spread betting.

you mention financing. what do you think a major spread betting firm charges for being long a UK stock overnight?

pboyles · Jan 14, 2011, 8:14am

Quote:

Originally Posted by shortsell

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

wackypete2 · Jan 14, 2011, 8:17am

Quote:

Originally Posted by shortsell

what do you think a major spread betting firm charges for being long a UK stock overnight?

OK, how much?

Peter

pboyles · Jan 14, 2011, 8:19am

Quote:

Originally Posted by wackypete2

OK, how much?

Peter

Cant tell you, GW Bush banned you all from this spreadbetting lark.

shortsell · Jan 14, 2011, 8:19am

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.

leonarda · Jan 14, 2011, 8:19am

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...

shortsell · Jan 14, 2011, 8:21am

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?

Jan 14, 2011, 8:07am	#10
shortsell Senior Member Member Since Apr 2006 140 Posts	Re: Using a GSL for a 100k short position ? did you know that some footballers dive? there are any number of completely irrelevent issues we can discuss whilst the market is quiet, but really we should concentrate on the one at hand - namely your belief that a serious investor in stocks shouldn't be spread betting. you mention financing. what do you think a major spread betting firm charges for being long a UK stock overnight?

Jan 14, 2011, 8:19am	#14
shortsell Senior Member Member Since Apr 2006 140 Posts	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.

Jan 14, 2011, 8:19am	#15
leonarda Veteran Member Member Since Sep 2009 603 Posts	Re: Using a GSL for a 100k short position ? 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...

Jan 14, 2011, 8:21am	#16
shortsell Senior Member Member Since Apr 2006 140 Posts	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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