Can spread betting company cheat?

[newTraderMike]

Hi folks,

I am new to this forum and like to ask some opinions from all experienced traders using spreadbetting.

I am not excatly new to spreadbetting and been doing this for about 4 years. I didn't made much money out of it and did't loss big as well. I had found some interesting statistics when I studied last 4 years positions (each one of them). what I realised is that the bigger I place the bet, the more chance my stop lost was hit. I am not here to argue when I was wrong and the market was against me. But there are really a lot of times I was right about the direction but the system just managed to hit my stop lost and turn in to my favour afterwards. To clairify how to get the data, here is what I normally do.

When I place a trade, I make a plan about size, direction, period I am holding it for, stop lost and stop win. If stop win is hit or I closed the position by myself, nothing recorded apart from profit. If the stop lost was hit I will record the lost and recheck the price at the end of the planned period. I only make about one/two trade per week, so it's not a lot of work to record them.

Does anyone had similiar experiences? Thanks in advance for any help.

 

[Aston1st]

Who is your broker?

 

[Jessi_trader]

Hi folks,

I am new to this forum and like to ask some opinions from all experienced traders using spreadbetting.

I am not excatly new to spreadbetting and been doing this for about 4 years. I didn't made much money out of it and did't loss big as well. I had found some interesting statistics when I studied last 4 years positions (each one of them). what I realised is that the bigger I place the bet, the more chance my stop lost was hit. I am not here to argue when I was wrong and the market was against me. But there are really a lot of times I was right about the direction but the system just managed to hit my stop lost and turn in to my favour afterwards. To clairify how to get the data, here is what I normally do.

When I place a trade, I make a plan about size, direction, period I am holding it for, stop lost and stop win. If stop win is hit or I closed the position by myself, nothing recorded apart from profit. If the stop lost was hit I will record the lost and recheck the price at the end of the planned period. I only make about one/two trade per week, so it's not a lot of work to record them.

Does anyone had similiar experiences? Thanks in advance for any help.

Hi There,

In this market, anyone can cheat. no matter if they are equity broker, future broker etc...

That's why its important to go with reputation.

In case of SB, SB companies frequently change spread between bid and ask and that's how they hit stops. This is known thing.

JT

 

[darktone]

Hi There,

In this market, anyone can cheat. no matter if they are equity broker, future broker etc...

That's why its important to go with reputation.

In case of SB, SB companies frequently change spread between bid and ask and that's how they hit stops. This is known thing.

JT

??? and what about the guys who offer fixed spreads?

 

[darktone]

Hi folks,

I am new to this forum and like to ask some opinions from all experienced traders using spreadbetting.

I am not excatly new to spreadbetting and been doing this for about 4 years. I didn't made much money out of it and did't loss big as well. I had found some interesting statistics when I studied last 4 years positions (each one of them). what I realised is that the bigger I place the bet, the more chance my stop lost was hit. I am not here to argue when I was wrong and the market was against me. But there are really a lot of times I was right about the direction but the system just managed to hit my stop lost and turn in to my favour afterwards. To clairify how to get the data, here is what I normally do.

When I place a trade, I make a plan about size, direction, period I am holding it for, stop lost and stop win. If stop win is hit or I closed the position by myself, nothing recorded apart from profit. If the stop lost was hit I will record the lost and recheck the price at the end of the planned period. I only make about one/two trade per week, so it's not a lot of work to record them.

Does anyone had similiar experiences? Thanks in advance for any help.

Sb dont need to cheat when theres a steady supply of crap traders out there to fade. The only time ive had an issue is when i was taking advantage of their pricing, i was then given 'more realistic' fills and a load of bollox when I phoned up to contest. "you wernt being very fair to us" they were right, I wasnt!

 

[counter_violent]

Hi There,

In this market, anyone can cheat. no matter if they are equity broker, future broker etc...

That's why its important to go with reputation.

In case of SB, SB companies frequently change spread between bid and ask and that's how they hit stops. This is known thing.

JT

Hopefully this guy can answer your questions, if you have any.

http://www.trade2win.com/boards/spread-betting-cfds/182926-other-side-screen.html

 

[newTraderMike]

Who is your broker?

I am using capital spread.

 

[newTraderMike]

I am using capital spread.

Got to say thanks for all the replies. I would guess I had to relook into my model and figure out whats wrong. I normally trade short term and with a stop lost less than 50 pips with 3% safty. The reason why I am asking is interesting. From my old records, the stop lost hit rate was much higher when I trade big. I.e. 10 or more. I personally don't think 10 is big trade but records shown my smaller trades are lot of more profitable than the big ones althought the same method was used. One more question here, would a 20 bet be a big impact on the market? I won't think so myself as I am trading index and that got be a lot money in the game. Thanks.

 

[Jessi_trader]

??? and what about the guys who offer fixed spreads?

Oviously, I was refering to the one who doesn't have fixed spread. Many have fixed spread during normal market hours and different spread in out of market hours.

Certainly not all have fixed spread. If you see their terms and conditions you will find some interesting stuff.

 

[darktone]

Oviously, I was refering to the one who doesn't have fixed spread. Many have fixed spread during normal market hours and different spread in out of market hours.

Certainly not all have fixed spread. If you see their terms and conditions you will find some interesting stuff.

Watching the order book out of hours its easy to see how thin markets can get, its then easier to understand why some sb would widen their spread then, or how a dynamic spread can widen and close back up rapidly.
Its also easy to see how joe bloggs sb trader sat there with his stop at 5, thinks hes been robbed when the market is bid 10 offered 11 and somewhere out there real market land 'other trader1' dumps 20 contracts at market. Other trader1 sees the market is only 20 contracts deep to 5 so understands that he will get filled at various prices between 10 and 5 and that his order will clear all bids at 5.
Unfortunately joe just sees his 'dynamic' spread price whack from 1 wide to 6 wide and back to 1 wide (when 'other trader2' bids 1 at 10 in real market a nano second later). To add insult to injury joes stop (market order to fire when x price is hit) is filled at 4!
After joes has got off the phone from his sb and completed his "I just been robbed!" post on T2W he has a chance to calm down. At this point joe can choose to do 1 of 2 things in regards to what just happened.
i) Go on believing he was robbed.
ii) Investigate the 'underlying price' thing the guy at the sb was talking about.

Imo, one of these choices will help him progress as a trader and one wont.

 

[darktone]

Got to say thanks for all the replies. I would guess I had to relook into my model and figure out whats wrong. I normally trade short term and with a stop lost less than 50 pips with 3% safty. The reason why I am asking is interesting. From my old records, the stop lost hit rate was much higher when I trade big. I.e. 10 or more. I personally don't think 10 is big trade but records shown my smaller trades are lot of more profitable than the big ones althought the same method was used. One more question here, would a 20 bet be a big impact on the market? I won't think so myself as I am trading index and that got be a lot money in the game. Thanks.

To be fair a 20ppp bet in any index is small, ie 2 contracts in ftse 100 (Z)
You can compare size per point / tick here.
http://www.prospreads.com/full_size_lots.php
More likely (and providing there has been no obvious change in PA) your increase in size affects your mindset which manifests itself in your trading (moving stops closer/missing trades/moving targets closer/waiting for more confirmation etc etc)
I know i sound like a broken record but imo Trading in the zone is essential reading for mindset management which imo is 90% of trading. Theres a pdf link in my sig below.
GL

 

[Jessi_trader]

Watching the order book out of hours its easy to see how thin markets can get, its then easier to understand why some sb would widen their spread then, or how a dynamic spread can widen and close back up rapidly.
Its also easy to see how joe bloggs sb trader sat there with his stop at 5, thinks hes been robbed when the market is bid 10 offered 11 and somewhere out there real market land 'other trader1' dumps 20 contracts at market. Other trader1 sees the market is only 20 contracts deep to 5 so understands that he will get filled at various prices between 10 and 5 and that his order will clear all bids at 5.
Unfortunately joe just sees his 'dynamic' spread price whack from 1 wide to 6 wide and back to 1 wide (when 'other trader2' bids 1 at 10 in real market a nano second later). To add insult to injury joes stop (market order to fire when x price is hit) is filled at 4!
After joes has got off the phone from his sb and completed his "I just been robbed!" post on T2W he has a chance to calm down. At this point joe can choose to do 1 of 2 things regards to what just happened.
i) Go on believing he was robbed.
ii) Investigate the 'underlying price' thing the guy at the sb was talking about.

Imo, one of these choices will help him progress as a trader and one wont.

...funny but true

 

[newTraderMike]

To be fair a 20ppp bet in any index is small, ie 2 contracts in ftse 100 (Z)
You can compare size per point / tick here.
http://www.prospreads.com/full_size_lots.php
More likely (and providing there has been no obvious change in PA) your increase in size affects your mindset which manifests itself in your trading (moving stops closer/missing trades/moving targets closer/waiting for more confirmation etc etc)
I know i sound like a broken record but imo Trading in the zone is essential reading for mindset management which imo is 90% of trading. Theres a pdf link in my sig below.
GL

Thanks Darktone, very informative.

 

[Splitlink]

Hi folks,

I am new to this forum and like to ask some opinions from all experienced traders using spreadbetting.

I am not excatly new to spreadbetting and been doing this for about 4 years. I didn't made much money out of it and did't loss big as well. I had found some interesting statistics when I studied last 4 years positions (each one of them). what I realised is that the bigger I place the bet, the more chance my stop lost was hit. I am not here to argue when I was wrong and the market was against me. But there are really a lot of times I was right about the direction but the system just managed to hit my stop lost and turn in to my favour afterwards. To clairify how to get the data, here is what I normally do.

When I place a trade, I make a plan about size, direction, period I am holding it for, stop lost and stop win. If stop win is hit or I closed the position by myself, nothing recorded apart from profit. If the stop lost was hit I will record the lost and recheck the price at the end of the planned period. I only make about one/two trade per week, so it's not a lot of work to record them.

Does anyone had similiar experiences? Thanks in advance for any help.

A new thread has started that might be worth a read,

The other-side of the screen. Last post 1051 hours

Can they cheat or do they cheat? You may find the answer there. There is no doubt that trading is difficult as it is,without the further worry of cheating.

I never have thought that I was big enough to be cheated and so have never given much thought to it.

 

[newTraderMike]

Watching the order book out of hours its easy to see how thin markets can get, its then easier to understand why some sb would widen their spread then, or how a dynamic spread can widen and close back up rapidly.
Its also easy to see how joe bloggs sb trader sat there with his stop at 5, thinks hes been robbed when the market is bid 10 offered 11 and somewhere out there real market land 'other trader1' dumps 20 contracts at market. Other trader1 sees the market is only 20 contracts deep to 5 so understands that he will get filled at various prices between 10 and 5 and that his order will clear all bids at 5.
Unfortunately joe just sees his 'dynamic' spread price whack from 1 wide to 6 wide and back to 1 wide (when 'other trader2' bids 1 at 10 in real market a nano second later). To add insult to injury joes stop (market order to fire when x price is hit) is filled at 4!
After joes has got off the phone from his sb and completed his "I just been robbed!" post on T2W he has a chance to calm down. At this point joe can choose to do 1 of 2 things regards to what just happened.
i) Go on believing he was robbed.
ii) Investigate the 'underlying price' thing the guy at the sb was talking about.

Imo, one of these choices will help him progress as a trader and one wont.

Thanks Darktone, a lot info here. Guess I am still qualified as a bad trader after 4 years. Surprisingly haven't lost a lot. In terms of underlying price on index, could you recommand some useful sources please? i.e. books, web links.

 

[darktone]

Thanks Darktone, a lot info here. Guess I am still qualified as a bad trader after 4 years. Surprisingly haven't lost a lot. In terms of underlying price on index, could you recommand some useful sources please? i.e. books, web links.

Your still here after 4 years, pat yourself on the back then! You made it through the first stage
Havent really got many suggestions re links etc, prolly best to just open a demo with prospreads or futures broker and get a feel for yourself. At the least you can see how the real market works. Maybe others could advise you better.
You can search terms like depth of market, dom trading, price ladder, order book etc.
This might be interesting for you, havent watched it myself tho.
http://www.youtube.com/watch?v=h6-EVlx_M4M

Theres two pieces of advice i could give you.
1) Read trading in the zone.
2) Read trading in the zone.

Imo, good trading is 90% psychological 9% technical

Gl and have a great Trading in the zone day

 

[rsh01]

bring/come back PBoyles!

 

[rsh01]

I know i sound like a broken record but imo Trading in the zone is essential reading for mindset management which imo is 90% of trading. Theres a pdf link in my sig below.
GL

ah ha - just bought the book! cheers for the link.

 

[Jessi_trader]

ah ha - just bought the book! cheers for the link.

Actually, you may not need to read this book if you have read enough before...

I have this book, I bought about 5 years before but so far never felt need to complete. And I have only read about 20 % so far....

You only need to know basics of this game, which is not complicated at all. Keep it simple if you want to be a long runner in this game. The more you make complicated the more trouble for you.

No matter how many books you read 100, 1000.. the message will be same....

remember only one thing "practice makes perfect"