Best Thread Capital Spreads

[arabianights]

looking good on cnbc this morning simon!

 

[capitalspreads]

dave

i was commenting on your inference of the delay ... no doubt the original commentator will be able to confirm the current situation is back to normal.

If you wish to pay the wider spreads on a competitor platform please continue to do so. The occasional deal rejection on our site (clients do get rejected on other platforms as well you know) will never, in the long run, make up for the wider price every single time you trade. A frequent trader with us will trade some 20 times a day. You would have to lose 20 pips on a deal rejection (every single day) to make up for this by trading on a wider spread. And this does not include the time when you actually get a better price on your rejected trade!

arabianights

thks.. i had to drag out the suit from the back of my cupboard.

Simon

 

[stevespray]

out of hours FTSE rejection. Dealers of any SB company can reject trades for many reasons. Just because you have never experienced this rejection before does not mean that it will never happen and frankly I feel reflects well on us that we have always stepped up to the plate in the past no matter what was going on. £40 may not sound like much but if your book is already something like £2000/point (pre market) with no hedge available and the client in question already has a large exposure then you can understand why we may have rejected any further increase in risk.

Simon

Simon,

Whilst I respect that fact that you generally respond to questions promptly I cannot always say that I agree with you. This is one such occasion.

You mention exposure and risk etc and say that you cannot hedge this risk pre market which we obviously understand. The problem which I have is the fact that, in any market, your quote is your quote – ie the ‘last word’ on the level which you are prepared to trade at. If your clients were building up a long exposure, which is what you imply, then why not move your quote upwards to reflect this and hence discourage further buyers and even, perhaps, draw out a few sellers which might help balance your book? In the case that we are discussing here your quote actually dropped lower in the few minutes after I opened £40 long. The quote then dropped further and I wanted £20 more. So effectively you are in a position where you are pressuring the long clients by dropping the quote lower but then stopping the client by ‘foul means’ from buying the new lower price – this seems very much like unfair treatment – clearly if you are not actually going to allow buying at that level then why move your quotation there?

Secondly, in your reply, you suggest that the fact that I already had a position in the market was a critical factor in the rejection. I find this mildly insulting to be honest. In my opinion whether or not a client has a position is irrelevant in running an ‘orderly market’. You are admitting that clients who did not have positions would be able to trade a market while, based on the firms discretion, another client (who did have a position) could be excluded from further trading even though their account was in order as set out in your customer agreement. I find it mildly amusing that when the boot is on one foot you claim that “we always do things exactly as you would find them in the real market” yet when you find it financially viable to do so you throw those ‘one liners’ out of the window and install a whole new set of ‘rules’ without reference to anything else. I think that you will find that ‘in the market’ you don’t get a chance to refuse certain people trading on your price whilst accepting others – you have no ability to detect the difference between them.

I am alarmed by your response because it shows contempt for your clients.

You say that you, or any other, s/b firm can refuse an order but I’m not sure that it is as clear cut as that. Section 4.12 from your Customer Agreement says the following;

“4.12 London Capital Group Ltd is not obliged to accept any opening bet or bets (in particular if you act in an abusive manner) provided that London Capital Group gives a reasonable excuse for such a refusal”

I’m not entirely sure that the explanation that you have given meets the criteria of term 4.12 since I don’t find it to be a valid or ‘reasonable reason’ for rejecting my order given that my account was in order and that the quote itself was perfectly valid. I know that, in the past, you have laughed at clients who have claimed that orders should have been processed and implied that you’re never obliged to accept orders but your agreement with your clients isn’t quite so clear cut. Whilst you can, under the contract, refuse any bet you have (to avoid being in breach of your agreement) provide a reasonable excuse for such refusal – simply saying ‘we didn’t fancy taking your trade’ (or words to that effect) does not satisfy your contractual obligations since the very basis of spreadbetting involves you taking on ‘bets’ against your clients based on the movements in your own financial instruments – as a result ‘the risk’ of such a business is a given (ie inherent in nature).

Needless to say you saved yourselves around £800 so well done to the dealer!

Steve.

 

[capitalspreads]

Steve

I am sorry, but if you do not consider that "excess market risk" is a reason to reject a trade then please can you get a job at the FSA and get them to change our company risk criteria then get on the phone to all those market makers who suddenly 'disappear' on a stock IN MARKET HOURS when the going gets tough. Might I point out that this was a pre-market situation with no undelying hedge available to us.

We have to draw a line somewhere. Otherwise we just say.. Oh ok!, one more, one more, one more etc and then you end up in a 'Global Trader' situation. A line is a line .. thats it.

Simon

 

[pit pony]

I agree it sounds steep but we need to bear in mind that a SB spread differs from a market spread in the sense there is not a buyer for every seller, but rather the bettor and the house, I'd assume they need a little slack to hedge all bets on the real market.

That spread will be where they make their profit, as competition and also users increase we should eventually see these decline.

The amount placed therefore determines the commission paid, IE a bet of £1 will pay far less commission than a bet of £5, therefore I believe SB works best with smaller stakes (which is all I use for now). Those with big money are far better off going DMA.

Si
i was using Futuresbetting for my spreadbetter, no matter if large or small bets their platform remains DMA and instant fills.They have fixed spreads and i agree the spread could get wider with a volatile mkt but i think the best out there when live.

 

[Phil Mibbutz]

Everything you say makes sense, Steve, so don't expect a reasoned reply, just take their advice and go elsewhere!

 

[stevespray]

Simon,

“Excess market risk”....

So you are saying that you couldn’t take any more long bets in FTSE regardless? Now call me dumb if you want but why, if you were full loaded short (customers were long), did your dealers move the price lower?? Surely, if things were as you are suggesting, then lowering your pre-market price will encourage more buyers? This makes no sense. You have an overweight book on the short side so you need to attract fresh sellers - not more buyers! Common sense says “let’s move our price higher”. What you have said doesn’t make logical sense. Secondly, in your reply #4356 you imply that the current position of the client in the market has a bearing on whether or not the deal was going to be accepted – the implication is there for all to see. The implication is that if the client didn’t have a position then the bet would be accepted. If ‘financial regulations’ prohibited such a deal anyway then I don’t see what bearing the clients current position has?

You have to try and see this from a client’s perspective Simon. This is an issue of ‘market clarity’. The moment that you disrupt order flow (assuming that price is correct etc) then people will cry ‘foul’. Why? Because in a sense is a form of market manipulation on your part. The whole point of a two way spread is that clients can deal either way based on the quotation offered. If you are allowed to move your price in one direction whilst denying clients the right to trade in the opposite direction then it becomes pretty obvious that the only winner is going to be you.

I’m still confused why you moved your quotation lower when you already had a heavy book on that side – maybe you could explain this?

Steve.

 

[ascon]

Yes Zarif! Yes! Yes! Yes!

This is the reason I, and a number of he regulars on here (but not all) have left Capital Spreads. I am guessing you have started to become, or have been, more profitable of late. Or maybe your trade size had crept up to a decent amount.

That is when CS turn the screw on you. Forget their "better spreads", its totally useless when they sit and wait on the trade for 30 seconds to see which way its going to go before they decide to let you in or not. You will find it improves a little sometimes, but sooner or later you will be back on intervention by their dealers and it will cost you.

Run away now, don't wait to try and "get your own back" on them. If you don't have an account big enough to go to a bank to trade, or want to stay with Tax Free Spread Betting, then get yourself over and try IGINDEX immediately. Its instantaneous 99% of the time, and pretty good even during news.

At least try them before you trade again with CS.

Just my opinion, alledgedly.

Dave

Good advice. I would advise anyone to try IGIndex. I tried them recently after a few years with Capital Spreads and am much happier.

The instant fills make a big difference to trading profitability. Of course if you pick the wrong direction the losses are still bad news. However, it is also important to note that it is always possible to close a position with IGINdex - Capital Spreads on the other hand do not always close the position (apparently of it does not suit their market view!) and this adds a major risk to their platform.

You will not regret using IGIndex- they are ten times better than CS.



Tony

 

[Crap Buddist]

Simon,

“Excess market risk”....

So you are saying that you couldn’t take any more long bets in FTSE regardless? Now call me dumb if you want but why, if you were full loaded short (customers were long), did your dealers move the price lower?? Surely, if things were as you are suggesting, then lowering your pre-market price will encourage more buyers? This makes no sense. You have an overweight book on the short side so you need to attract fresh sellers - not more buyers! Common sense says “let’s move our price higher”. What you have said doesn’t make logical sense. Secondly, in your reply #4356 you imply that the current position of the client in the market has a bearing on whether or not the deal was going to be accepted – the implication is there for all to see. The implication is that if the client didn’t have a position then the bet would be accepted. If ‘financial regulations’ prohibited such a deal anyway then I don’t see what bearing the clients current position has?

You have to try and see this from a client’s perspective Simon. This is an issue of ‘market clarity’. The moment that you disrupt order flow (assuming that price is correct etc) then people will cry ‘foul’. Why? Because in a sense is a form of market manipulation on your part. The whole point of a two way spread is that clients can deal either way based on the quotation offered. If you are allowed to move your price in one direction whilst denying clients the right to trade in the opposite direction then it becomes pretty obvious that the only winner is going to be you.

I’m still confused why you moved your quotation lower when you already had a heavy book on that side – maybe you could explain this?

Steve.

mmm, well sounds like they are making a market, but only for some , to a certain level ehh steve?

I dunno what Stewart Wheeler would make of it all.

What about you and your mates hitting them with phone dealing to see if you can build your position? Hey they advertise jolly phone dealing welcomed.

And if they refuse to make a market for "certain" clients, then, lets get that cancer exposed & sorted out of the industry, cos it reeks of filthy desease. That stink of corrupt principal needs to be neutralised .

Thank you Steve for sharing your realities & experiences with us.

The truth will out.

 

[ascon]

grantx

you might as well say the same about any contract. But in reality if a client found an error going back to the biginning of our business (oct 03) we would adjust his account in his favour. As we have never had an instance of an error going back longer than a month or so I cannot actually say how long CS would consider a price error (in our favour) to be still in play but we would probably find it difficult to go back further than a few months or so. In reality the chances of us finding it get less and less.

You must remember that this is when there has been a very obvious price error (even the exchanges have them). It does not happen very often and when I have commented on them freely most 'independent' readers have seen my point. Unfortunately most of the time I am constrained by data protection from giving times/dates/trades etc to demonstrate any individual examples.

Although if a client were willing to give permission on this thread then I will happily do a full audited example.

We have a very, very good reputation for customer services, prices, robustness etc etc. We did a full survey of our clients last year and even we were surprised at how good the response was.

It is very easy to attack SB companies (we are never exactly going to be listed in the cuddlyiest companies of the world) but remember there are generally more than one side to every argument.

Ariel Communications

we commission Ariel to develop most of our applications (as they have done for many of the SB companies) but we run the systems and we are responsible for all of their functionality as it impacts our clients. They are not a regulated entity but aside from being our IT supplier we have no other interests in them. (i.e nobody at CS owns any portion of them).

Simon

I am impressed by your reassuring statement "Although if a client were willing to give permission on this thread then I will happily do a full audited example." and would like to see if you are actually prepared to keep to you word.

I believe that there are many instances on my account of contract closure at an incorrect rate and would be willing to give permission for publication here of a full audited example of some (or all!) of the transactions on my account.

Tony

 

[aphex]

O/T Is it usual for a SB company to ask for a bank statement (copy)? the last account i opened (paddy) they never bothered

 

[tar]

O/T Is it usual for a SB company to ask for a bank statement (copy)? the last account i opened (paddy) they never bothered

Yes

 

[aphex]

Yes

cheers

 

[tar]

cheers

for account opening they ask for statement or utility bills .
for withdrwing money by bank transfer some of them ask for statement .

 

[capitalspreads]

Steve

why ask questions you know the answer to.

The reason that the price fell was nothing to do with our position but to do with the fact that the other markets (Dax, Dow, S&P) on which we calculate our premarket prices fell. In general we have a pre-market limit on individual client positions. Frankly I do not see what the problem about this is. In hours you can build your positions in the FTSE to whatever you like up to 2 or 3 thousand pounds a point - becus we can hedge. Out of hours we cannot hedge so we limit exposure

This is an argument over one day,in one market that was not even open when you traded. Lets get this in a little in perspective. For those of you who cry 'foul' please remember that if you had a position in the FTSE futures on a DMA platform there would be none of this. It would be 'out of hours' and therefore the market would be closed .. no argument.

account opening... we have various requirements that a prospective account must fulfil. If on initial aplication we cannot confirm, independently, various bits of information supplied by a client we may then ask for further info which might take the form of a utility bill or a bank statement.

If a client is asking for a refund to a different place than from where he/she deposited the money we will definately ask for solid info on bank account details and on the card(s) used to fund the account. (Fraud/moneylaundering prevention etc)

Simon

 

[Vorbis]

One Cancels Other?

I think this question may have been asked before but I could'nt find it using the search facility.
Is the "One Cancels Other" option offline ? I tried using it earlier today but it's greyed out and I was unable to enter any values.

 

[shortorlong]

I think this question may have been asked before but I could'nt find it using the search facility.
Is the "One Cancels Other" option offline ? I tried using it earlier today but it's greyed out and I was unable to enter any values.

Greyed out for me too .. been a while since I used it, and I did not notice until your post.

 

[shortorlong]

I think this question may have been asked before but I could'nt find it using the search facility.
Is the "One Cancels Other" option offline ? I tried using it earlier today but it's greyed out and I was unable to enter any values.

I called support and they say they are not offering this function now .. they might re-introduce it in the future.
hmm .. wonder why .

 

[marlintrdg]

I think this question may have been asked before but I could'nt find it using the search facility.
Is the "One Cancels Other" option offline ? I tried using it earlier today but it's greyed out and I was unable to enter any values.

Try to enter one side of the order, then go-to amend to complete the other side of the OCO.

Just a thought, tried it on the demo and it worked for me, not sure how it will work on the real platform..

Edit: 1 hour later on the Demo, now getting an error doing the above work around..

 

[tar]

I think this question may have been asked before but I could'nt find it using the search facility.
Is the "One Cancels Other" option offline ? I tried using it earlier today but it's greyed out and I was unable to enter any values.

U cant use these oco orders at this time but i noticed they active it b4 ( non farm payrolls ) release b4 2 month !