Best Thread Spreadbetting, the myths and what is the reality?

[montmorencyt2w]

I thought the thread was about myth-busting, or, if appropriate, myth-confirming (with evidence).

Well in the past I've mentioned spikes in the USDX, which I happened to see from my SB platform (I don't trade it, but I use it as an "indicator").


An old hand mentioned that this had had happened on the real market, and it wasn't the first time; trades beyond a certain level had had to be invalidated (or whatever the technical term is). i.e (at least in these cases) it had actually happened; it wasn't the SB playing games, but just reflecting the underlying market. Not of course saying that this is always the case.

 

[D70]

Are there actually any posters here, who have had there accounts restricted by spreadbet companies, because they were too successful?

Gamma,
I think Trader_Dante was closed down by VDM (now called Gekko Global). He posted the saga on here somewhere for all to see.

I was closed down (many moons ago) by Choiceodds.

Due to being "too successful"..... i very much doubt it, but closed down none the less.

 

[gamma]

Gamma,
I think Trader_Dante was closed down by VDM (now called Gekko Global). He posted the saga on here somewhere for all to see.

I was closed down (many moons ago) by Choiceodds.

Due to being "too successful"..... i very much doubt it, but closed down none the less.

It does made sense really, to lose a sucessful client as all they have to do is hedge the bets.
Its almost like giving up a good crystal ball, which would show you, which bets to hedge and which to leave open to collect some easy money.

 

[gle101]

Gamma,
I think Trader_Dante was closed down by VDM (now called Gekko Global). He posted the saga on here somewhere for all to see.

I was closed down (many moons ago) by Choiceodds.

Due to being "too successful"..... i very much doubt it, but closed down none the less.

Yes I am restricted, excessive re-quote and referral to a dealer with some. No closed account though, very seldom done today. This could happen though, mostly due to harsh manners in communicating with them is my guess. Yes I agree, sucessful might be the wrong word to use, it is is rather on grounds of not acceptable trade patterns.

 

[gamma]

I can understand SB co's getting pissed with scalpers.

No time to hedge

 

[gle101]

I can understand SB co's getting pissed with scalpers.

No time to hedge

I think most so called SB scalpers hold positions long enough for them to hedge. They also don't need to hedge all the orders coming through.

 

[D70]

I can understand SB co's getting pissed with scalpers.

No time to hedge

Hi Gamma,
My experience with Choiceodds was somewhat comedy.
After putting thru very light volume and size to get a feel for their platform and to check all was above board. i started getting delays in trade confirmation, then i started to get rejected..... after a few days of rejection (executing via other platforms) i called up.........

I asked if there was an IT issue or if there platform was down, very politely....... I got the impression they had had similar phone calls because the guy was less than friendly. I then got a call back from the boss and was told he was freezing my account because it was expected that I was a "professional".......... laughable really. I had only made about 1,500 gbp........ they just shouldnt have been pricing their options so out of whack.

They were a joke back then and i suspect a joke still today (last thing i heard was that MAN group had bought them).

So scalping wasnt the issue here.

Trader_Dante is probably the guy with most knowledge, he has accounts with everyone.

 

[gle101]

Hi Gamma,
My experience with Choiceodds was somewhat comedy.
After putting thru very light volume and size to get a feel for their platform and to check all was above board. i started getting delays in trade confirmation, then i started to get rejected..... after a few days of rejection (executing via other platforms) i called up.........

I asked if there was an IT issue or if there platform was down, very politely....... I got the impression they had had similar phone calls because the guy was less than friendly. I then got a call back from the boss and was told he was freezing my account because it was expected that I was a "professional".......... laughable really. I had only made about 1,500 gbp........ they just shouldnt have been pricing their options so out of whack.

They were a joke back then and i suspect a joke still today (last thing i heard was that MAN group had bought them).

So scalping wasnt the issue here.

Trader_Dante is probably the guy with most knowledge, he has accounts with everyone.

Good trading then.

I guess, if you are a swingtrader you can trade for years without problem.

 

[Black Swan]

Good trading then.

I guess, if you are a swingtrader you can trade for years without problem.

IMO we should never do any trading 'lower' than swing with the SB firms...fly low, under the radar...

 

[gle101]

which (IMO) is all should do with the SB firms...fly low, under the radar...

Which radar?

 

[Black Swan]

Which radar?

heh man, that's deep, you been on the 'rooms whilst trading?

 

[gle101]

heh man, that's deep, you been on the 'rooms whilst trading?

Oh, then I get it.

 

[kwickwool]

All the issues discussed can be sorted by going to a company like prospreads that gaurantee fast execution and no requotes, I am not connected to the company at all but if you are a scalper or any sort of short term trader the platform is set up perfectly for very fast executions without requotes. Was extremely impressed with the fact that 100% of trades were hedged and profit only taken from the spread, which for me meant the platform and services would be totally set up around looking after the client, heard different recently in that 100% are now not hedged but either way as long as I can enter and fill trades with super fast execution times I am very happy.
Why would a short term trader ever consider using a SB firm that does not support short term trading? having problems when you do is a bit like complaining about getting wet when you go for a swim is it not?

 

[gle101]

All the issues discussed can be sorted by going to a company like prospreads that gaurantee fast execution and no requotes, I am not connected to the company at all but if you are a scalper or any sort of short term trader the platform is set up perfectly for very fast executions without requotes. Was extremely impressed with the fact that 100% of trades were hedged and profit only taken from the spread, which for me meant the platform and services would be totally set up around looking after the client, heard different recently in that 100% are now not hedged but either way as long as I can enter and fill trades with super fast execution times I am very happy.
Why would a short term trader ever consider using a SB firm that does not support short term trading? having problems when you do is a bit like complaining about getting wet when you go for a swim is it not?

Why choose Prospreads when you can trade the futures at a much lower cost? It being tax free doesn't account for much when you have a serious look at the long term costs for taking on the positions. A lot of traders decide to trade SB due to the lower entry level, e.g trading the FTSE futures is too much a stake for a lot of traders.

 

[kwickwool]

yes agree with the above but am very surprised that tax free does not compensate for the long term costs for positions? Not that I am disputing your info, just very surprised?

 

[SimonK]

Ok, here's a myth or fact I would like confirmed.

I've noticed that the IGIndex platform tends to crash or become unavailable after an unusual parabolic move in the market. An example was the morning of December 31st when the platform was down for a few hours. The day before, we had seen GBPUSD travel 250 pips against the trend. On Dec 31st, the move continued another 180 pips. A sure bet for most amateurs.

My theory is that spreadbetting companies can only make money when the markets behave normally, i.e. frequently changes direction. Parabolic moves mean that everyone can jump on board and fill their boots which the spreadbet companies do not like.

Any thoughts on this one?

 

[Splitlink]

Yes I agree, I have never understood why some traders prefers the charts that SB provides.

It's not that I prefer them. It's that they are there and I use them. I have the Forex charts, which are free, and seem to give the same reading as theirs. I keep an eye on my broker's index and share readings and see little difference to worry me unduly. Spikes, at the end of the day, are similarly recorded on Big Charts and Yahoo.

My wife is beginning to think that I am paranoid! I tell her that it is because I read you lot, in between trading, and that has made me more nervous than when I met her.

 

[Black Swan]

Ok, here's a myth or fact I would like confirmed.

I've noticed that the IGIndex platform tends to crash or become unavailable after an unusual parabolic move in the market. An example was the morning of December 31st when the platform was down for a few hours. The day before, we had seen GBPUSD travel 250 pips against the trend. On Dec 31st, the move continued another 180 pips. A sure bet for most amateurs.
My theory is that spreadbetting companies can only make money when the markets behave normally, i.e. frequently changes direction. Parabolic moves mean that everyone can jump on board and fill their boots which the spreadbet companies do not like.

Any thoughts on this one?

With all due respect bud who identifies this trend (swing), you? Looks perfectly tradeable (and was, on a 2hr TF) to me. If you're trading off dailys that's what happens; the longer trend has to change someday and it's hardly ever 'gentle' is it? and it (Cable) had been on quite a downward trajectory since mid late Nov so was arguably ready for a change in direction/sentiment...

There are infinite numbers of these types of, as you term it "parabolic", moves throughout the year and I've gained from many of them on several pairs. If it was an issue they'd never be able to take non farm trades or interest rate trades period. In conversation with IG you can always pick up the phone if you can't trade from the platform.

Having said that I was pissed of with the serious amount of downtime yesterday, but that was a once in a year event for me...be v. concerned if it happened often....

 

[SimonK]

With all due respect bud who identifies this trend (swing), you? Looks perfectly tradeable (and was, on a 2hr TF) to me. If you're trading off dailys that's what happens; the longer trend has to change someday and it's hardly ever 'gentle' is it? and it (Cable) had been on quite a downward trajectory since mid late Nov so was arguably ready for a change in direction/sentiment...

There are infinite numbers of these types of, as you term it "parabolic", moves throughout the year and I've gained from many of them on several pairs. If it was an issue they'd never be able to take non farm trades or interest rate trades period. In conversation with IG you can always pick up the phone if you can't trade from the platform.

Having said that I was pissed of with the serious amount of downtime yesterday, but that was a once in a year event for me...be v. concerned if it happened often....

ok, maybe I shouldnt have called it a trend, as it depends on your timeframe. But it was an out of the ordinary move at an unexpected time, i.e not during a scheduled news announcement. I still reckon this caught IG unawares.

I agree that generally the IG platform is stable, but I have seen it go down after huge moves before.

Saying that, I still made money from them yesterday

 

[kwickwool]

When it comes to these sorts of thoughts over underhand tactics of a spread betting company, things like this cannot stay secret forever, people inside IG spreads have to know whats going on and that will always make its way externally via whistle blowing and unhappy emplyee's etc etc etc. This sort of expsure would bring down any spread betting company for sure and the fact nothing does ever materialise that has substantial fact is probably proof in itself that they are albiet having issues via software and human error but not pure manipulation?