Spreadbetting gtd stop losses.

Hey all,

I see FinSpreads have an account that will always give you guaranteed stop losses, or you can just use them on a regular account in general. If you are using these, then surely leverage should never be a problem for you since you will always be covered for any massive spike and against any black swan. Is that correct?

I know they are an extra 3 pips it adds to your spread every time, but surely this is a small price to pay for security.

Does anyone use them religiously?

Thanks.

tehmac said:

Hey all,

I see FinSpreads have an account that will always give you guaranteed stop losses, or you can just use them on a regular account in general. If you are using these, then surely leverage should never be a problem for you since you will always be covered for any massive spike and against any black swan. Is that correct?

I know they are an extra 3 pips it adds to your spread every time, but surely this is a small price to pay for security.

Does anyone use them religiously?

Thanks.

Click to expand...

Good idea if you swing trade especially for stocks , but for daytrading its a waste of money , you could easily choose one of the brokers with - negative balance protection - instead .

GSL's sound fine but I'm thinking they're an easy way for the firm to make more money from offering the same product - like the extended warranty offer on white goods.

There's a wider spread to accept, but there's also an up-front fee payment required. This is non-refundable even if your GSL is never hit, even if you cancel your GSL. Don't know for sure about Fins but you usually can't move or change the GSL like a trailing stop, that would mean a new GSL which would mean another opening fee.

I use GSL for 80% of my currency trades, after the SNB situation earlier this year I really didn't fancy being bankrupted if a position goes 16000 points against me in the blink of an eye!

I use IG, whose GSL charge varies per instrument but generally just doubles the spread - which I think is a small price to pay for peace of mind for any swing trades...

Plus IMO the cool thing with GSL's is that once your position is in profit and you move the GSL to breakeven or better you free up 100% of your margin to put to work on new trades or increasing your exposure to the current trade.

Think of them as an insurance, you can't insure your car after you crashed it through the wall, its only then you wished you had taken it out beforehand. Shop around for a broker with tighter spreads and cheaper GSL, you may find you can get one for the same price as your paying now in spread..