Spreadbetting.

kimo'sabby · Apr 7, 2011

How come spread betting companies only give tight spreads on hugely ranging markets? The smaller the range and pricing, the bigger the spread becomes in general.

It's as if the spreadbetting companies don't want people to have a slice of the 'easy' money...at least not on their watch.

Conniving barstewards. Punters beware.

Doomberg · Apr 7, 2011

Worst i have seen was bank of ireland bid €0.31 ask €0.32 what a joke lol

Although its rarely that bad

shortsell · Apr 7, 2011

well on stocks they just wrap their spread around the underlying, and the smaller less liquid stocks tend to have bigger percentage spreads so naturally this is reflected in the SB's price.

no need to let that get in the way of a good baseless moan though obviously.

kimo'sabby · Apr 7, 2011

Doomberg said:
Worst i have seen was bank of ireland bid €0.31 ask €0.32 what a joke lol

Although its rarely that bad

Its similar to a bookmaker shortening the odds on a horse.

shortsell · Apr 7, 2011

bwahahahaha.

kimo'sabby · Apr 7, 2011

shortsell said:
well on stocks they just wrap their spread around the underlying, and the smaller less liquid stocks tend to have bigger percentage spreads so naturally this is reflected in the SB's price.

no need to let that get in the way of a good baseless moan though obviously.

Liquidity doesn't come into it and i'm not on about stocks. Thanks for posting though.

shortsell · Apr 7, 2011

what markets are you talking about for example?

i think it fairly obvious that the other chap was talking about stocks...

and if you think liquidity doesn't impact market spread....

kimo'sabby · Apr 7, 2011

shortsell said:
what markets are you talking about for example?

Mainstream punter markets,..... oh wait, no, i mean really obscure markets that nobody bets on. Ffs.

shortsell · Apr 7, 2011

kimo'sabby said:
shortsell said:

what markets are you talking about for example?

Mainstream punter markets,..... oh wait, no, i mean really obscure markets that nobody bets on. Ffs.

Click to expand...

well the main markets for most sb firms would be ftse, dow, s&p (which is the one i thought you might say as some firms are still a bit wide), e/$, £/$. of those 'mainstream punter markets' most are available on either 1 or 2 points, so can you give a specific example?

tar · Apr 7, 2011

shortsell said:
well the main markets for most sb firms would be ftse, dow, s&p (which is the one i thought you might say as some firms are still a bit wide), e/$, £/$. of those 'mainstream punter markets' most are available on either 1 or 2 points, so can you give a specific example?

He meant short sterling and euribor , the spread is 2-3 points ...

shortsell · Apr 7, 2011

as mainstream retail punter markets?! or markets that would be 'easy money' otherwise?

come off it.

counter_violent · Apr 7, 2011

Well yep...the more savvy SB'ers clearly know which products are value and which are'nt . Thats all there is to say about it really.

TheBramble · Apr 7, 2011

If I understand it correctly, the moan is the perennial one about the amount of padding the SBs insulate themselves with. I really can’t blame them. It’s a great business model and when I grow up, I want an SB company so I can screw pocket-money traders too.

The argument often used to normalise their slice and make it seem all nice and regulated is that they must remain competitive (in their spreads) in order to attract/maintain their client base and minimise arbing opportunities.

The bookies managed to keep themselves rather splendidly synchronised for a good many years before the advent of internet technology so I think it’s reasonable to assume their 21st century offspring can more than handle the small effort involved in keeping up appearances. Especially as today’s average SB punter is somewhat less clued up than their grandfather when it comes to how things really work in that particular game.

kimo'sabby · Apr 7, 2011

tar said:
He meant short sterling and euribor , the spread is 2-3 points ...

Actually, the Euriboring could fall into that catagory.....so predictable.

TheBramble · Apr 7, 2011

counter_violent said:
Well yep...the more savvy SB'ers clearly know which products are value and which are'nt .

I wouldn't go so far as to suggest that's a contradiction in terms as there are a few. But only a very few.

kimo'sabby · Apr 7, 2011

counter_violent said:
Well yep...the more savvy SB'ers clearly know which products are value and which are'nt . Thats all there is to say about it really.

True.

shortsell · Apr 7, 2011

TheBramble said:
If I understand it correctly, the moan is the perennial one about the amount of padding the SBs insulate themselves with. I really can’t blame them. It’s a great business model and when I grow up, I want an SB company so I can screw pocket-money traders too.

The argument often used to normalise their slice and make it seem all nice and regulated is that they must remain competitive (in their spreads) in order to attract/maintain their client base and minimise arbing opportunities.

The bookies managed to keep themselves rather splendidly synchronised for a good many years before the advent of internet technology so I think it’s reasonable to assume their 21st century offspring can more than handle the small effort involved in keeping up appearances. Especially as today’s average SB punter is somewhat less clued up than their grandfather when it comes to how things really work in that particular game.

when i was on an SB desk (albeit a specialist desk within a firm) my client list was made up almost entirely of current and ex market professionals - sophisticated guys who knew exactly what they were doing, trading big size (for a retail environment) and making big money - tax free.

obviously there are the £2 of ftse guys who punt for a bit of fun, but are they really looking to day trade euribor? no.

kimo'sabby · Apr 7, 2011

shortsell said:
when i was on an SB desk (albeit a specialist desk within a firm) my client list was made up almost entirely of current and ex market professionals - sophisticated guys who knew exactly what they were doing trading big size (for a retail environment) and making big money - tax free.

obviously there are the £2 of ftse guys who punt for a bit of fun, but are they really looking to day trade euribor? no.

Did they refer to you as a trader?... "I'll just put you over to one of our 'traders' on the 'dealing desk'...". Luv it.

shortsell · Apr 7, 2011

kimo'sabby said:
Did they refer to you as a trader?... "I'll just put you over to one of our 'traders' on the 'dealing desk'...". Luv it.

my title was sales trader, but execution dealer would probably have been more appropriate. why do you ask?

kimo'sabby · Apr 7, 2011

shortsell said:
my title was sales trader, but execution dealer would probably have been more appropriate. why do you ask?

Doesn't matter. Lets just say it's been noted for future reference.

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