Bet against what exactly?

[farmerben]

Hi all, been lurking quite a while learning what I can from the posters on this board. It's all really good stuff for a newbie like me!
I am also trying out spread betting on the cheap to learn for myself exactly what I expect to gain from it, or rather how much, how quickly and in what way. I rather like watching the screen and like to try and take modest quick profits during the day, even the odd binary bet only for fun.

Firstly, I am using Finspreads and have read the rather lively comments and rants about them so I only need constructive comments rather than a good old slagging match. Don't take this the wrong way!

My question is this (probably going to turn into several!)

I am with Fins as you know and when betting the ftse100 what exactly am I trading? It seems like Fins own ftse100 and not the actual index itself. I get the impression I am betting against others betting on the ftse!

How does this relate to a live ftse quote or streaming chart and are any actually live anyway? (without paying ie livecharts, yahoo etc)

Therefore this may mean that trying to interpret the Fins charts of the ftse is not as 'pure' as studying the actual ftse chart?


And would paying for a live quote actually help me to bet against the other betters?

Head now hurts but I think you may be getting the gist of it so I will leave it here for now. I appreciate this may have been answered already but I still don't feel totally crystal clear on this and would be really grateful for any explanations you may have.

Ben

 

[jiggly]

you are betting against yourself really,

if you win you take a portion of the pool of money deposited with your broker by all traders. If you lose you add to the pool of money deposited by all traders. the broker always takes the spread over into their own pool of money. your broker must cover the net asset value of all accounts under management.

your broker provides for you live quotes obtained from the real markets price action.

it is always a good idea to source your own independent charting software which has no affiliation with your brokers. This is to ensure you get a separate opinion on every price quoted.

you broker allows you to trade the prices quoted.

 

[Lightning McQueen]

Hi Ben

Some good first questions and observations. I can give you my opinion, others may have a different view, so here goes.
Spread betting companies Index Rolling Bets use a price derived from the Futures market, taking into account funding and dividends(called fair value), to create a price that is representative of the underlying Index market. so for example, if you look on fins at the rolling price of the FTSE it may differ slightly from what you see, say on yahoo but not by much, remember the index itself is not tradeable in the real world, only its future.

This thread should help, its large so perseverance is needed.

http://www.trade2win.com/boards/showthread.php?t=16595

Regarding your impression of betting against other punters, well yes you are in effect, if you win you take money from the losers and visa versa. I try not to think of it like that, I think of it as my strategy against the movement of the price, Im trading in the right direction or not.

I dont think a separate live feed would help edge wise, your strategy is either good or pants. I find IT Financial charting (most SB charting use this format) is actually very good IMO, they are free with your SB company and are very advanced these days and getting better. I will go as far as saying that you have a slight edge in that strats exist on this platform that do not or appear vague on other paid for charting or standalone platforms.

By the way whats your general strategy/method to pull money out of the market, you do have one I hope.

Regards.

don

 

[Trader333]

It seems like Fins own ftse100 and not the actual index itself.

As with all bookmakers, you may take money from others who are betting in the opposite direction to you but in essence you are betting against the spreadbetting company itself. There have been many arguments about this on here about whether they hedge all bets. In my view this is highly unlikely as evidenced by one SB shareholder report that stated profits were less than anticipated because clients had been more lucky than was anticipated and that this anomaly was unlikely to continue.


Paul

 

[charliechan]

one SB shareholder report that stated profits were less than anticipated because clients had been more lucky than was anticipated and that this anomaly was unlikely to continue.


Paul

lol!

no sh!t....

 

[farmerben]

Sorry, been away for a while, sometimes farming gives you little time to play!

Thank you all for your replies, I continue to learn an enormous amount from this forum it is an absolute goldmine of information for a newbie like me.

Thanks again

Ben