Best Thread Capital Spreads
lurkerlurker
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Out of hours pricing
I think most of us here are of the opinion that while guaranteed stops are a bit of a gimmick, and only useful in extreme circumstances, I can see why some clients would find it beneficial. Personally I would not pay for a guaranteed stop for indices or FX, however I can see why it would be a useful feature for some commodities and certainly for equities. (NRK anyone?) I think that the minimum distance specified by most of the SB companies makes a GSO pretty useless anyway - I'm sure if CS ever did do guaranteed stops they would be much tighter than other firms!
Is it the case (and I may have misunderstood the FSA rules on this) that a spreadbetting company who offers GSO's must treat this as a form of insurance and comply with additional bookkeeping requirements? If so, I think it makes it easier to understand why it isn't attractive for you to offer a service which few (if any) clients would truly benefit from when it distracts you and your team from your core services.
Regarding out of hours markets, I'd be quite interested to know how SB firms come up with a price for an instrument which isn't trading. My presumption would be that you take another instrument which is trading at this time and displays high correlation to the out of hours market, and put it through an algorithm which gives you an approximation of the price. However, I'd be interested to know more about how this would be done.
For example, I'd assume the FTSE out of hours is priced on the Dow/S&P. However, if you were to offer this market 24 hours, what would happen if there was news or data which only affected a FTSE 100 constituent (or sector) and not America? Would the FTSE price algorithm take into account the movements of many instruments, including those that trade in the Asian session?
Further, how accurate are these models? I might be a little naive here, but if it were possible to construct a model to estimate with reasonable accuracy the fair value of instrument X given the prices of instrument Y and Z, would this not open up interesting possibilities for taking proprietary positions based on these relationships?
An example of this which comes to mind is in commodities, where it is possible to trade a position on one commodity on the basis that it has fallen out of sync with another correlated instrument (think calendar spreads on soy beans,oil, and meal, or the relationship between corn and livestock, or certain metals and energies). Wouldn't having a model to accurately determine stock index values out of hours allow similar trades during market hours?
Finally, how does a SB firm go about finding these models? Are they developed in house by your quants or dealers, or do you hire consultants? If the models are ever wrong, does this directly cost CS? For example if you were quoting the FTSE at 6500/1 and it opened at 6563/4 and your clients had been net long pre market, would this come out of your pocket, or can you hedge? If you can hedge, doesn't that expose you to additional market risk relying on the correlation to hold firm enough to limit your exposure in the underlying. Also, what protection do you (and clients) have from pricing errors if the underlying is closed. As in the above example, if your price for the FTSE premarket was quite far away from the opening price, and clients had been generally bullish before the open, would you allow those trades? Conversely, if your clients lost money because your estimate of the FTSE was quite far away from where it opened, would you break the trades? In the case of a dispute, what do you use as a reference price given that the underlying is closed? Is it simply your risk and the clients risk to trade on "grey market" prices? Would you for example amend the entry price of the premarket trades to the first print from Z at LIFFE?
Sorry if these are a lot of questions, but I think people would be interested to know some of the answers, and you have done a good job of shining a light on the mysterious internals of SB firms in the past. Naturally I'd understand if you can't answer these questions for business reasons, or don't have the time to respond in detail.
I think most of us here are of the opinion that while guaranteed stops are a bit of a gimmick, and only useful in extreme circumstances, I can see why some clients would find it beneficial. Personally I would not pay for a guaranteed stop for indices or FX, however I can see why it would be a useful feature for some commodities and certainly for equities. (NRK anyone?) I think that the minimum distance specified by most of the SB companies makes a GSO pretty useless anyway - I'm sure if CS ever did do guaranteed stops they would be much tighter than other firms!
Is it the case (and I may have misunderstood the FSA rules on this) that a spreadbetting company who offers GSO's must treat this as a form of insurance and comply with additional bookkeeping requirements? If so, I think it makes it easier to understand why it isn't attractive for you to offer a service which few (if any) clients would truly benefit from when it distracts you and your team from your core services.
Regarding out of hours markets, I'd be quite interested to know how SB firms come up with a price for an instrument which isn't trading. My presumption would be that you take another instrument which is trading at this time and displays high correlation to the out of hours market, and put it through an algorithm which gives you an approximation of the price. However, I'd be interested to know more about how this would be done.
For example, I'd assume the FTSE out of hours is priced on the Dow/S&P. However, if you were to offer this market 24 hours, what would happen if there was news or data which only affected a FTSE 100 constituent (or sector) and not America? Would the FTSE price algorithm take into account the movements of many instruments, including those that trade in the Asian session?
Further, how accurate are these models? I might be a little naive here, but if it were possible to construct a model to estimate with reasonable accuracy the fair value of instrument X given the prices of instrument Y and Z, would this not open up interesting possibilities for taking proprietary positions based on these relationships?
An example of this which comes to mind is in commodities, where it is possible to trade a position on one commodity on the basis that it has fallen out of sync with another correlated instrument (think calendar spreads on soy beans,oil, and meal, or the relationship between corn and livestock, or certain metals and energies). Wouldn't having a model to accurately determine stock index values out of hours allow similar trades during market hours?
Finally, how does a SB firm go about finding these models? Are they developed in house by your quants or dealers, or do you hire consultants? If the models are ever wrong, does this directly cost CS? For example if you were quoting the FTSE at 6500/1 and it opened at 6563/4 and your clients had been net long pre market, would this come out of your pocket, or can you hedge? If you can hedge, doesn't that expose you to additional market risk relying on the correlation to hold firm enough to limit your exposure in the underlying. Also, what protection do you (and clients) have from pricing errors if the underlying is closed. As in the above example, if your price for the FTSE premarket was quite far away from the opening price, and clients had been generally bullish before the open, would you allow those trades? Conversely, if your clients lost money because your estimate of the FTSE was quite far away from where it opened, would you break the trades? In the case of a dispute, what do you use as a reference price given that the underlying is closed? Is it simply your risk and the clients risk to trade on "grey market" prices? Would you for example amend the entry price of the premarket trades to the first print from Z at LIFFE?
Sorry if these are a lot of questions, but I think people would be interested to know some of the answers, and you have done a good job of shining a light on the mysterious internals of SB firms in the past. Naturally I'd understand if you can't answer these questions for business reasons, or don't have the time to respond in detail.
lurkerlurker
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Sorry if it is a little cheeky to recommend a competitor on the CS thread, but here goes.
Some other SB firms (I'm thinking IG and CMC here) offer most markets 24 hours. Keep some funds in an account with one of these companies, and the one time per year that you find yourself locked into a position similar to what you describe above with CS and no way to cover, immediately offset your exposure in your IG/CMC account. You will pay 2 spreads, however you only pay extra in the very very rare occasions when it is necessary to exit a position overnight, which is cheaper in the long run than paying a premium on every trade.
So, you can continue to trade with CS, and take advantage of the 24 hour markets in other firms if you need to cover during the night! Further, I think that it fosters good discipline not to be able to exit - it forces you to set your size and risk appropriately when holding overnight positions. Remember, in the underlying there would be no way to exit until the open, and I'm fairly sure that it is the ambition of every successful trader who spreadbets to eventually trade at the exchange (with the exception of Joe Taxpayer who does 400 per point on the S&P and wouldn't want the CGT/IT for trading the underlying).
On a lighter note, I wonder how many people who trade size in the stock index futures call a SB company in the middle of the night for a price in 200 per point of the closed market in order to limit their risk in the case of a mini-crash).
Guaranteed stops:
It's really to cover gaps, that may occur when the market is closed and therefore (possibly) allowing a price to gap significantly past a stop whilst the trader is unable to do a darn thing about it. Bearing in mind that SB is a noticeably leveraged product then a price gap becomes a noticeably leveraged gain or loss.
Let's put it another way - if I put £1 a point on the Dow, intending to run my bet for a week with a 100 pt stop loss, then in the normal course of events I'm looking to make a couple of hundred quid on a good week, but trying to ensure a bad week costs me only £100.
I accept that price might gap a little past my stop during market hours, so my risk is a little more than £100 in the normal course of events.
With a market that is not tradeable (therefore my stop is being ignored) for 10 hrs of the 24 it is free to gap a great deal further than the 100 pts I've set.
I would have thought an SB company's biggest objection to a Gstop is simply that it provides the customer with a definite limit to their risk, for a small premium, whilst if the market gapped in favour of the client the SB company don't enjoy the same benefit.
Whether the size of stop required, and the premium charged, was reasonable or not would be up to the customer to decide, not (with respect) for the bookmaker to decide for them. As customers using gstops would, presumably, be playing only with money held in the account it would also avoid problems with people losing more than they had in their accounts, which I imagine occasionally occurs?
It's really to cover gaps, that may occur when the market is closed and therefore (possibly) allowing a price to gap significantly past a stop whilst the trader is unable to do a darn thing about it. Bearing in mind that SB is a noticeably leveraged product then a price gap becomes a noticeably leveraged gain or loss.
Let's put it another way - if I put £1 a point on the Dow, intending to run my bet for a week with a 100 pt stop loss, then in the normal course of events I'm looking to make a couple of hundred quid on a good week, but trying to ensure a bad week costs me only £100.
I accept that price might gap a little past my stop during market hours, so my risk is a little more than £100 in the normal course of events.
With a market that is not tradeable (therefore my stop is being ignored) for 10 hrs of the 24 it is free to gap a great deal further than the 100 pts I've set.
I would have thought an SB company's biggest objection to a Gstop is simply that it provides the customer with a definite limit to their risk, for a small premium, whilst if the market gapped in favour of the client the SB company don't enjoy the same benefit.
Whether the size of stop required, and the premium charged, was reasonable or not would be up to the customer to decide, not (with respect) for the bookmaker to decide for them. As customers using gstops would, presumably, be playing only with money held in the account it would also avoid problems with people losing more than they had in their accounts, which I imagine occasionally occurs?
I think this is very sound advice indeed, not solely for the sake of protecting an overnight position, but also for securing a stop loss. For instance, when the main SB that one trades with, freezes, and more so, if the site goes down just as one is about to change the stop loss for the position. This has happened to me a couple of times. If that occurs, you have a choice to either hedge the position immediately at the other SB, or put an opposite limit order in place. As you are saying this is a low cost insurance against a very bad scenario.
capitalspreads
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second accounts
I think that I have mentioned several times on this thread that it is always advisable to have secondary accounts because you never know. At Capital Spreads we have three seperate routes into all our various markets our main electronic broker, a back up electronic broker and an old fashioned telephone broker.
Of course you should pick one that gives reasonable spreads and does not require funds to keep open but these days one should not be difficult to find.
calculating the FTSE out of hours is a matter of taking the Dax S&P and Dow after the 17.30 close in the FTSE and creating an algorithm that works to a reasonable degree of success. Of course there are also ADM's to help out as well(although fewer than there used to be because of Sarbannes Oxley). Whilst we offer the markets in good faith there is no guarantee that we get it right. Nearly every day there is some 10 points move around the 08.00 opening on the markets. A classic day was the 9th October where we were happily quoting around 6550 (the closing level of the night before) just before the open and after the first few seconds we were down at 6530 and then 6520. Anyone who called the open as very weak and sold to us in the premarket period would have done well. But remember the spread is 4 points and my dealers are very good at early calls so you would have to be very good to consistently beat us.
As mentioned by lurker guaranteed stops are most worthwhile in equities which is probably why most SB companies will not give a closer stop than 5 to 10% away depending on the stock !!
I am pretty sure that a responsible trading desk would not have been offering guaranteed stops on Northern Rock after the initial turmoil. I would have strong words with any dealer of mine who continued to offer such cheap insurance in such a dangerous stock.
Simon
I think that I have mentioned several times on this thread that it is always advisable to have secondary accounts because you never know. At Capital Spreads we have three seperate routes into all our various markets our main electronic broker, a back up electronic broker and an old fashioned telephone broker.
Of course you should pick one that gives reasonable spreads and does not require funds to keep open but these days one should not be difficult to find.
calculating the FTSE out of hours is a matter of taking the Dax S&P and Dow after the 17.30 close in the FTSE and creating an algorithm that works to a reasonable degree of success. Of course there are also ADM's to help out as well(although fewer than there used to be because of Sarbannes Oxley). Whilst we offer the markets in good faith there is no guarantee that we get it right. Nearly every day there is some 10 points move around the 08.00 opening on the markets. A classic day was the 9th October where we were happily quoting around 6550 (the closing level of the night before) just before the open and after the first few seconds we were down at 6530 and then 6520. Anyone who called the open as very weak and sold to us in the premarket period would have done well. But remember the spread is 4 points and my dealers are very good at early calls so you would have to be very good to consistently beat us.
As mentioned by lurker guaranteed stops are most worthwhile in equities which is probably why most SB companies will not give a closer stop than 5 to 10% away depending on the stock !!
I am pretty sure that a responsible trading desk would not have been offering guaranteed stops on Northern Rock after the initial turmoil. I would have strong words with any dealer of mine who continued to offer such cheap insurance in such a dangerous stock.
Simon
Re the Northern Rock scenario, I quite understand - I also can see why an SB company might prefer not to accept limited risk on the clients' side of the deal, whilst retaining (almost) unlimited risk on their own behalf...a gap might well be in favour of the client, after all. The problem would probably dwindle to zero with 24 hr coverage, I'm purely looking to remove the problems caused by gaps, I have no trouble accepting seeing my stop hit as the price passes through it - although I would have been happier to have worked this out theoretically rather than by extensive experience.
I have to disagree with
- although that's just about all I'd argue with from LurkerLurker...you've decided your trade, you've decided what you are prepared to risk on this one deal, and for 14 hours you are free to decide the dynamic has altered sufficiently to alter your view of the traded instrument. Then for the next 10 hours you are locked in, even if the martians just landed.
Trading the underlying - yes, I expect you are correct there too. Were I trading the actual future I would not be considering this strategy...
Thanks for all contributions, and for Simon's patience
I have to disagree with
- although that's just about all I'd argue with from LurkerLurker...you've decided your trade, you've decided what you are prepared to risk on this one deal, and for 14 hours you are free to decide the dynamic has altered sufficiently to alter your view of the traded instrument. Then for the next 10 hours you are locked in, even if the martians just landed.
Trading the underlying - yes, I expect you are correct there too. Were I trading the actual future I would not be considering this strategy...
Thanks for all contributions, and for Simon's patience
lurkerlurker
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For those of us who aren't market professionals, could you clarify what an ADM is and why SOx causes problems?
I don't think it would be advisable to try and trade against a SB firm rather than against the market in any circumstances! However, from what I understand from your posts, your profit is quite similar to trades * spread * average trade size, and you generally make money from hedging when you don't make money on the book. In out of hours markets, isn't it the case that you profit from losing trades and the winning clients win at your expense on out of hours indices? I was just wondering where the risks lie in the instances where there is an unexpected opening gap - I was also wondering how a fair price would be defined in the case of any dispute since neither side can point to the exchange T&S and say "it traded (or didn't trade) there". Regarding the spread, if you entered the trade premarket and closed after the open, you'd pay half the 4 point spread to enter (assuming your bid/offer are both 2 away from the market mid), and a 0.5 spread to exit for a total of 2.5. That seems a little easier to make a profit.
Perhaps that, and the fact that with very close guaranteed stops it would be possible to take opposing orders in two accounts or firms when the probability of a directional move > the GSO minimum distance + spread became sufficiently high (ie the day before an quarterly report, dividend size announcement, merger meeting, etc). You would effectively pay 2 spreads and 2 GSO premiums, and then have a profit locked in if the underlying moves more than the GSO distance in a single direction. With the volatility in some stocks, allowing very close GSO's would give punters the opportunity to print money at the SB firms expense.
Regarding NRK, could you tell us some more about how your desk handled that? Was there a lot of hedging activity at the time? I'm sure you kept quoting, however did you widen your spreads? As a general rule, does CS hedge in outrights, options, or a combination?
Thanks for the contributions to the board. If I'm asking too many questions, or nobody else cares about the answers, please feel free to tell me to shut up. I wonder why nobody at CMC, IG, City, etc have thought to answer some questions and provide clients with information on these boards. It is clearly good PR to do so.
davecrom01
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Error msg on log in.
Evening all,
Anyone else getting:
Description: An error occurred during the compilation of a resource required to service this request. Please review the following specific error details and modify your source code appropriately.
Compiler Error Message: BC30002: Type 'Ariel.GatewayProviders.Protx.Request' is not defined.
Source Error:
Line 1505:
Line 1506: 'Initiate the Request Object
Line 1507: Dim req As New Ariel.GatewayProviders.Protx.Request
Line 1508: 'Initiate the Response Object
Line 1509: Dim resp As New Ariel.GatewayProviders.Protx.Response
When they try and log into CS tonight?
Cheers,
Dave
Evening all,
Anyone else getting:
Description: An error occurred during the compilation of a resource required to service this request. Please review the following specific error details and modify your source code appropriately.
Compiler Error Message: BC30002: Type 'Ariel.GatewayProviders.Protx.Request' is not defined.
Source Error:
Line 1505:
Line 1506: 'Initiate the Request Object
Line 1507: Dim req As New Ariel.GatewayProviders.Protx.Request
Line 1508: 'Initiate the Response Object
Line 1509: Dim resp As New Ariel.GatewayProviders.Protx.Response
When they try and log into CS tonight?
Cheers,
Dave
lurkerlurker
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Yes, that error is present, along with various web server errors (500 internal server error). Further, the platform is moaning about processor errors and no instruments come up.
London Capital Group Holdings plc
Betfair White Label Agreement
London Capital Group Holdings plc (the "Company"), the financial services and
online spread betting company, is pleased to announce that it has reached an
agreement with Betfair, the revolutionary egaming operator, to provide it with
the Company's white label spread betting product.
Betfair is the world's leading online betting exchange, a concept it has
pioneered. Driven by cutting-edge technology, Betfair enables its customers to
choose their own odds and bet against each other, even after an event has
started. Betfair processes five million transactions a day and more than 300
bets a second.
300 BETS A SECOND... Not a bad audience to tap into..... I think the 7 and a half percent jump in the share price today is just the beginning of a long vertical ride
JK
Betfair White Label Agreement
London Capital Group Holdings plc (the "Company"), the financial services and
online spread betting company, is pleased to announce that it has reached an
agreement with Betfair, the revolutionary egaming operator, to provide it with
the Company's white label spread betting product.
Betfair is the world's leading online betting exchange, a concept it has
pioneered. Driven by cutting-edge technology, Betfair enables its customers to
choose their own odds and bet against each other, even after an event has
started. Betfair processes five million transactions a day and more than 300
bets a second.
300 BETS A SECOND... Not a bad audience to tap into..... I think the 7 and a half percent jump in the share price today is just the beginning of a long vertical ride
JK
Last edited:
capitalspreads
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general questions/ lurker
For those of us who aren't market professionals, could you clarify what an ADM is and why SOx causes problems?
I actually meant ADRs which are UK shares quoted in USD on a US exchange, they generally trade until 21.00 and are in the bigger weighted stocks on the FTSE 100. One of the unintended consequences of Sarbannes Oxley was that a UK company that wished to have its shares quoted on a US exchange as well as the FTSE would have to abide by all the US accounting rules etc which are very, very expensive and have several other nasty consequences as well. As a result many UK companies decided to remove their listings and, of course, AIM has become the global exchange of choice for new IPOs.
Out of hours FTSE pricing is a bit of a bug bear for us in that we do not get all that much business in it but as all the other SB companies quote it and our clients demand it we have to be seen to be in the same space. We do quote it on just 4 pips wide which is tighter than most. Our terms have a special clause for 'out of hours' quoted markets where the price is defined as where we reasonably quote it in relation to other world markets or words to that effect. We can reference our price against competitor prices of course in the instance of a dispute.
Regarding NRK, could you tell us some more about how your desk handled that? Was there a lot of hedging activity at the time? I'm sure you kept quoting, however did you widen your spreads? As a general rule, does CS hedge in outrights, options, or a combination?
we continued to quote NRK throughout the turmoil but after the fall to 400p we did increase our margin to 20% (remember we are only at 3% for FTSE 100 stock which we have retained all the way through all the chaos of the last three months) we hedge with outright share purchases and also we have a FTSE 100/250 tracker calculator which means that we combine many of the bets to create a FTSE equivalent product and then hedge using FTSE futures.
simon
For those of us who aren't market professionals, could you clarify what an ADM is and why SOx causes problems?
I actually meant ADRs which are UK shares quoted in USD on a US exchange, they generally trade until 21.00 and are in the bigger weighted stocks on the FTSE 100. One of the unintended consequences of Sarbannes Oxley was that a UK company that wished to have its shares quoted on a US exchange as well as the FTSE would have to abide by all the US accounting rules etc which are very, very expensive and have several other nasty consequences as well. As a result many UK companies decided to remove their listings and, of course, AIM has become the global exchange of choice for new IPOs.
Out of hours FTSE pricing is a bit of a bug bear for us in that we do not get all that much business in it but as all the other SB companies quote it and our clients demand it we have to be seen to be in the same space. We do quote it on just 4 pips wide which is tighter than most. Our terms have a special clause for 'out of hours' quoted markets where the price is defined as where we reasonably quote it in relation to other world markets or words to that effect. We can reference our price against competitor prices of course in the instance of a dispute.
Regarding NRK, could you tell us some more about how your desk handled that? Was there a lot of hedging activity at the time? I'm sure you kept quoting, however did you widen your spreads? As a general rule, does CS hedge in outrights, options, or a combination?
we continued to quote NRK throughout the turmoil but after the fall to 400p we did increase our margin to 20% (remember we are only at 3% for FTSE 100 stock which we have retained all the way through all the chaos of the last three months) we hedge with outright share purchases and also we have a FTSE 100/250 tracker calculator which means that we combine many of the bets to create a FTSE equivalent product and then hedge using FTSE futures.
simon
nkruger
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Spanish Ibex Index
Hi Simon - haven't been on these boards for a while, so you may have answered this perenial question (from me) already.
Any more news on whether CS may include the Spanish 35 Index in your armoury ? (Fins/CMC's spread is sooooo wide !!)
Thanks.
.
Hi Simon - haven't been on these boards for a while, so you may have answered this perenial question (from me) already.
Any more news on whether CS may include the Spanish 35 Index in your armoury ? (Fins/CMC's spread is sooooo wide !!)
Thanks.
.
lurkerlurker
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Thanks for the informative reply, especially re SOx. The mind boggles at the latter part of your post - with so many clients, and so many views on a market, your net exposure must be extremely low in contrast to your clients position sizes. I'm just thinking about the volume you must take in your daily FTSE contract, and what your total net exposure to the FTSE must be when you have clients in usual long equities and day traders selling the FTSE....
binaries
simon,
I´m sorry. i already asked for this, but wouldn´t it be possible to make some small improvements with your binary bets? There are mainly three things I´d like to see:
- the starting value of the underlying (maybe in the info tab) to have a clear reference point.
- updates of the net change in real time.
- continued quotes after the close until the outcome of a bet is finally decided.
i really enjoy adding binaries to my trading from time to time, so i would be happy to see some little changes there.
simon,
I´m sorry. i already asked for this, but wouldn´t it be possible to make some small improvements with your binary bets? There are mainly three things I´d like to see:
- the starting value of the underlying (maybe in the info tab) to have a clear reference point.
- updates of the net change in real time.
- continued quotes after the close until the outcome of a bet is finally decided.
i really enjoy adding binaries to my trading from time to time, so i would be happy to see some little changes there.
0007
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Good firewall advice ?
I was surprised to read this on Capital Spreads' FAQ section of their website:
"Firewalls
Although we have taken care to design the site to be compatible with the most popular firewall vendors, it is quite possible that specific firewall settings or configuration could limit your experience of the Capital Spreads website. If you are using a firewall and are not sure whether it is the cause of your problem, please email us with details of the type of firewall that you have. As a simple test, you could shut down your firewall for a few seconds while you reload the Capital Spreads site."
I've heard reports that an unfirewalled PC could be vulnerable to attack even for short periods. Could any IT experts comment please?
I was surprised to read this on Capital Spreads' FAQ section of their website:
"Firewalls
Although we have taken care to design the site to be compatible with the most popular firewall vendors, it is quite possible that specific firewall settings or configuration could limit your experience of the Capital Spreads website. If you are using a firewall and are not sure whether it is the cause of your problem, please email us with details of the type of firewall that you have. As a simple test, you could shut down your firewall for a few seconds while you reload the Capital Spreads site."
I've heard reports that an unfirewalled PC could be vulnerable to attack even for short periods. Could any IT experts comment please?
lurkerlurker
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Offtopic
Yes, you could be unlucky enough to be hacked in the 30 seconds your firewall software is not running.
Without meaning to sound condescending, any PC administered by an individual with inadequate knowledge of security is vulnerable to attack. This is a simple fact. In general, it is unlikely that anyone would manually probe your box in the few seconds it would take to disable your firewall and test the CS site, so your only real risk is from "bots" which make automated attempts to access systems.
If you have a router on your home network, you should be relatively safe provided that certain ports are not forwarded - and they aren't by default on most routers. Remember that the "firewall" software you are operating is most likely one which actively interferes in connections and blocks perfectly legitimate traffic. Many of the software "firewalls" designed for home users interfere with the correct operation of some websites, and other Internet services.
My advice would be to try a different firewall and see if the issue persists. This has the advantage of not having you fully exposed to an untrusted network. Just make sure you have everything you might need saved to your hard drive, including the instructions for installing and removing the two firewall programs, so that you can resolve problems without risking Internet access.
On a more general point, in my view CS are quite right to suggest this. They do not make any representations that it would be entirely safe for the user to do so, however it is a fairly certain way of quickly ascertaining if a certain piece of software is interfering with a client's use of the platform. They also seem happy to advise by email. People are responsible for their own security, and it is quite clear where the blame should lie in a case where a user is hacked because he followed the instructions of a website which asked him to turn off the firewall.
Unless this question was specifically about the advice on the CS site (which I don't see why anyone would have an issue), could these posts be moved to a more appropriate section of the forum?
Yes, you could be unlucky enough to be hacked in the 30 seconds your firewall software is not running.
Without meaning to sound condescending, any PC administered by an individual with inadequate knowledge of security is vulnerable to attack. This is a simple fact. In general, it is unlikely that anyone would manually probe your box in the few seconds it would take to disable your firewall and test the CS site, so your only real risk is from "bots" which make automated attempts to access systems.
If you have a router on your home network, you should be relatively safe provided that certain ports are not forwarded - and they aren't by default on most routers. Remember that the "firewall" software you are operating is most likely one which actively interferes in connections and blocks perfectly legitimate traffic. Many of the software "firewalls" designed for home users interfere with the correct operation of some websites, and other Internet services.
My advice would be to try a different firewall and see if the issue persists. This has the advantage of not having you fully exposed to an untrusted network. Just make sure you have everything you might need saved to your hard drive, including the instructions for installing and removing the two firewall programs, so that you can resolve problems without risking Internet access.
On a more general point, in my view CS are quite right to suggest this. They do not make any representations that it would be entirely safe for the user to do so, however it is a fairly certain way of quickly ascertaining if a certain piece of software is interfering with a client's use of the platform. They also seem happy to advise by email. People are responsible for their own security, and it is quite clear where the blame should lie in a case where a user is hacked because he followed the instructions of a website which asked him to turn off the firewall.
Unless this question was specifically about the advice on the CS site (which I don't see why anyone would have an issue), could these posts be moved to a more appropriate section of the forum?
0007
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Lurker,
Thanks for your lucid & well-informed reply. I raised it on this thread as it is advice specifically given by Capital Spreads and as you point out, the non-expert (who may be reading CS's FAQs) is particularly vulnerable. I agree it is not directly related to spread betting so I am very happy to let the mods decide the appropriate place for these postings.
I would like to know from you guys who trade with Capitalspreads, will they allow you to trade picking up 3 to 10 ticks through the day trading their forex instruments?. Basicaly short term trades where I can be in a trade from 5 mins to 30 mins.
Cheers
LT
Cheers
LT
nkruger
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