Best Thread Capital Spreads

[ChartMan]

Right . I've had enough of this.! I'm coming out of the closet and declaring my ignorance. :cheesy:
I thought hedging meant taking the opposite side. I go long, the SB goes short. I win shed loads, they lose shed loads.
Can someone pls explain why I'm wrong.

 

[masmit]

Well, at the risk of revealing my own ignorance, I think it goes like this:

You want to go long August CL, you call the SB and place a market order. They then actually go long an appropriate number of contracts of August CL at the NYMEX. When you close your position they do too. If you won, they also won, passing the winnings on to you, but deducting the spread from your winnings. If you lost, they lost too, except that your loss covers theirs, plus the spread. Therefore, they are neutral as to the direction of the market, and make their money simply from charging the spread, whether you win or lose.

I'm sure the reality is a lot more complicated, but I believe that's the idea...

Cheers,

Mark

 

[ChartMan]

That figures.... but then that's not what I understood hedging to be. I'd call it 'mirroring' a client's position....

 

[masmit]

Well, it's hedging because they have two positions. In the example, they are on the other side of your long trade, ie. short, but they hedge it by being long at the NYMEX...

Cheers,

Mark

 

[a0-0b]

spread betting vs direct access

Simon,

Sorry for dragging this up (again), i'm just catching up on things now after a wee break.
Your "arguments" for/against direct access are very well thought out and convincing. I'll accept all your points without questions. But i'd like to make one comment (if i may). When i talk about wanting "direct access" to spread-betting i don't mean direct-access to markets (obviously). I want an automated method of placing orders which does not require my physical presence at a computer or telephone. The reason for this is two fold, 1 - i work during the day, and 2 - i'm probably the weakest link in any trading i do (much better to let a machine handle it).

To cover some of your points:

you have to pay to have direct access.... SB platforms are free

I'll happily pay for the service. SB can remain free, i would happily pay for a feed of your prices and an API or link to a suitable trading platform - assuming i can afford it ofcourse
(if it's going to be automated trading i'd like to trade against your price and not prices from another source).

one of the major points missed here is that in general SB companies will accept trades in greater size than is available in the real market and will also accept trades even if the actual price was no longer there with direct access either you get the price or not.

That's a fair point, and there are a number of ways to handle it (each of which will get you some abuse from someone i would imagine). For example, place a maximum trade size on each product traded on the automatic platform. I would even suggest that it would be allowable to set a variable maximum trade size depending on volatility. After all if you won't accept £100/point because of large moves, i can still make a profit on £10/point.

I realise the amount of effort involved in implementing something like this is significant, but I assume most brokers (of whatever form) use a select handfull of backend systems, so there are probably solutions already available. Ant this would be a great industry first fro you , and another great feather in your cap. You already lead the way in service and support, how about extendig that to new way to spreadbet?

a0-0b

 

[capitalspreads]

a0-0b

we are developing an 'If Done' order module on our systems at the moment. The problems with API disemination is
a) the security angle
b) the clients ability to program his own trading system
c) the fact that we would be in a difficult position if the client came back disputing a trade that his system had made.
d) the cost of implementation against the potential trade volume.

I will raise this anyway with our IT developers and see if there is a simple solution. But I have to say we are back-logged on several projects at the moment anway.

we already do limit the bet size in every market but this size is in general greater than the normal 'shape size' available in the market.

Simon

 

[minx]

we are developing an 'If Done' order module on our systems at the moment.
Simon

Will that be the same as an 'if the price reaches 275.25 then sell £5 per point' order???
I'd really like to see that as its really annoying to miss a trade because you're called away from the computer for a couple of hours......
Thanks

 

[darrenf]

Will that be the same as an 'if the price reaches 275.25 then sell £5 per point' order???
I'd really like to see that as its really annoying to miss a trade because you're called away from the computer for a couple of hours......
Thanks

That's just a normal stop or limit order which I think capital spreads already allows. (I stand to be corrected).

What an if done order will allow you to do in your example is to say if the above order is executed or "done" and you sell £5 per point at 275.25, then it allows you to pre set a stop loss and/or limit to say stop you out of the trade at 275.50 or take profits at say 274.50.

These additional orders would only be placed though once the first order is executed ie "if done"

This allows you not only to walk away from the screen and know that you will automatically open a trade at a certain level, it also means that a stop loss and/or limit will be activated to protect your position and/or take profits at a level predetermined by you.

This is a facility offered by many brokers, particularly fx and futures. However, no sb co (to date) has offered it.

Capital spreads hopefully will be the first, and they can include me in their list of new accounts once they do. I have been waiting quite a while for it!

 

[minx]

That's just a normal stop or limit order which I think capital spreads already allows. (I stand to be corrected).

This allows you not only to walk away from the screen and know that you will automatically open a trade at a certain level, it also means that a stop loss and/or limit will be activated to protect your position and/or take profits at a level predetermined by you.

Thats what I meant. I think you can only place stops once you've placed a trade, I dont think you can tell it to sell XYZ @ 275 when it gets there to open a position. Again I could be wrong too.
I know IG have the stop/profit facility with is really handy but then again their spreads are wider. Would certainly be great to see......

 

[MysticalTrader]

darrenf, you are right. Capital Spreads dont allow you to open a position on a stop. Stops only allowed on positions already open.

MT

Thats what I meant. I think you can only place stops once you've placed a trade, I dont think you can tell it to sell XYZ @ 275 when it gets there to open a position. Again I could be wrong too.
I know IG have the stop/profit facility with is really handy but then again their spreads are wider. Would certainly be great to see......

 

[capitalspreads]

minx / mystical trader

Sorry ..but you are wrong you can do both order types on our trading area

you have missed the 'new / limit' order function on our platform.

The order button (after the trade button) allows you to place 'limit' (or take profit) orders or 'new' (i.e open a new position) orders.
So you can take advantage of our tight prices AND our new order limit order funtions.

my comment about 'what if' functionality would be when you have placed a 'new' order (to open a trade at a possible future price) to ALSO enable you to place a prearranged stop(loss) and/or limit(profit) order to the new trade rather than just accept our computer generated one.


Many of our clients use the profit order funtion and generally place them at chart resistance / support levels.

good trading today

simon

 

[MysticalTrader]

Simon, hi


Excellent. TYhat is good news and I didnt know about that.

MT

ps btw, I sent you a PM because I didnt want to look like a big girlie in pubic, but you probably didnt see it. Any chance of placing 50p stakes like Finspreads? Just for us girlie newbies?

minx / mystical trader

Sorry ..but you are wrong you can do both order types on our trading area

you have missed the 'new / limit' order function on our platform.

The order button (after the trade button) allows you to place 'limit' (or take profit) orders or 'new' (i.e open a new position) orders.
So you can take advantage of our tight prices AND our new order limit order funtions.

my comment about 'what if' functionality would be when you have placed a 'new' order (to open a trade at a possible future price) to ALSO enable you to place a prearranged stop(loss) and/or limit(profit) order to the new trade rather than just accept our computer generated one.


Many of our clients use the profit order funtion and generally place them at chart resistance / support levels.

good trading today

simon

 

[a0-0b]

a) the security angle
b) the clients ability to program his own trading system
c) the fact that we would be in a difficult position if the client came back disputing a trade that his system had made.
d) the cost of implementation against the potential trade volume.

Fair enough!
I guess if there was enough potential trade the other 3 could be overcome, but you can't argue with the bottom line! From the security angle, it would be no worse than the java based client you have at the minute (which could be reversed if someone had the inclination), you could also integrate with current standard products which allow automated trading to get around (b) and as for (c) - well no arguments there, people will always bitch and moan about something

Anyways ... I'll be more than happy with the if-then system.
Out-of-interest ... (and since this is still being developed) you may want to place minimum distance for stop/limit orders on the "booking screen" (or even better, minimum values) to avoid a shed load of unallowed trades ... i notice the current order/trade screens don't have this - so i always place a stop one point away from the live price to get it rejected and see what the limit will be.

a0-0b

P.S. if you require any beta testers for features (on a paper account ofcourse) feel free to ask. i'm sure a lot of us would be mroe than happy.

 

[MysticalTrader]

you are right. I managed to miss that option. Thanks


MT

minx / mystical trader

Sorry ..but you are wrong you can do both order types on our trading area

you have missed the 'new / limit' order function on our platform.


simon

 

[jklondon]

Alas - fed up with 'sudden' widenning spreads on my IG account - and getting whacked out on my Stop Losses I am seriously looking at CapitalSpreads

Just been playing around with the charting feature - looks pretty comprehensive, wanted to know

- Does anyone who trades with CS activley use this ? I assume the prices are all CS implied spread prices which track the underlying pretty close ? if so is their any need to have a feed from another provider ?? (sorry if this is a silly question)

- Is their an affiliate program for CS ! Have some friends I could bring along if all goes well with my switch. ?

Thanks ! Good w/e all.

 

[masmit]

That's just a normal stop or limit order which I think capital spreads already allows. (I stand to be corrected).

What an if done order will allow you to do in your example is to say if the above order is executed or "done" and you sell £5 per point at 275.25, then it allows you to pre set a stop loss and/or limit to say stop you out of the trade at 275.50 or take profits at say 274.50.

These additional orders would only be placed though once the first order is executed ie "if done"

This allows you not only to walk away from the screen and know that you will automatically open a trade at a certain level, it also means that a stop loss and/or limit will be activated to protect your position and/or take profits at a level predetermined by you.

This is a facility offered by many brokers, particularly fx and futures. However, no sb co (to date) has offered it.

Capital spreads hopefully will be the first, and they can include me in their list of new accounts once they do. I have been waiting quite a while for it!

Isn't this what D4F call a 'contingent' order in their platform?

Cheers,

Mark

 

[jklondon]

So am I right in saying CapitalSpreads are looking to implement complete working order functionality ? This is something that is offered, as mentioned, in futures & fixed income markets.

Would I be able to create the working order outside trading hours ?

 

[masmit]

Would I be able to create the working order outside trading hours ?

I second this question. For those of us who are using EOD systems, the facility to place orders after (or before) market hours would be vey useful.

Mark

 

[MysticalTrader]

I think the charts at CS are delayed. Check itbefore using...

MT

Alas - fed up with 'sudden' widenning spreads on my IG account - and getting whacked out on my Stop Losses I am seriously looking at CapitalSpreads

Just been playing around with the charting feature - looks pretty comprehensive, wanted to know

- Does anyone who trades with CS activley use this ? I assume the prices are all CS implied spread prices which track the underlying pretty close ? if so is their any need to have a feed from another provider ?? (sorry if this is a silly question)

- Is their an affiliate program for CS ! Have some friends I could bring along if all goes well with my switch. ?

Thanks ! Good w/e all.

 

[capitalspreads]

jklondon

we are about to offer an introduce a friend option . We have an IB program in place for FSA registered companies / individuals.

Placing of orders outside of market hours is not currently possible. I will enquire as to the feasability of allowing this but it causes so many arguements that we may not do so.

I dont know a great deal about the D4F platform so I am not sure about 'contingent' orders but the name would suggest the same thing.

Simon