CFD v Spread Bet FTSE 100

[monkey180]

Hello there,

I am SB the FTSE 100 with IG Markets, and there is the usual difference between the real cash price and the SB price. Eg, real will be 5 points profit, and SB will only be 3 ect... after spread ect...

I was wondering would a CFD FTSE Contract be more close to the real price than the SB price? As I think they are meant to mirror the price, or is a market market maker, a market maker at the end of the day?

Or would a FTSE Futures SB price be closer to the real Futures, as that is a real traded instrument?

I think that IG are the closest to the real cash price, ETX I find are way off, although their Gold Prices are spot on to the real cash rolling.

Thanks

 

[FP Markets]

Hello there,

I am SB the FTSE 100 with IG Markets, and there is the usual difference between the real cash price and the SB price. Eg, real will be 5 points profit, and SB will only be 3 ect... after spread ect...

I was wondering would a CFD FTSE Contract be more close to the real price than the SB price? As I think they are meant to mirror the price, or is a market market maker, a market maker at the end of the day?

Or would a FTSE Futures SB price be closer to the real Futures, as that is a real traded instrument?

I think that IG are the closest to the real cash price, ETX I find are way off, although their Gold Prices are spot on to the real cash rolling.

Thanks

The difference between the prices of CFDs and Spread Betting is completly dependant on the provider. With a market maker model they choose the spread so you will never know how close they will keep it to the real price (some do offer fixed spreads and obviously some brokers are better than others). With market makers they can quote different prices on the same instrument to different clients at the same time. If you are looking to actualy bet or trade of the FTSE Future then you would be best looking at a DMA provider. This may not be suitable for traders who like to do a pound a point due to the fact that the position size has to be of the full value of the contract.

Hope this helps
Alex

 

[MrMarshall]

I've found city index CFD contracts and SB prices are much closer to real price than IG Markets. Spreads are a lot tighter too.

 

[gle101]

The difference between the prices of CFDs and Spread Betting is completly dependant on the provider. With a market maker model they choose the spread so you will never know how close they will keep it to the real price (some do offer fixed spreads and obviously some brokers are better than others). With market makers they can quote different prices on the same instrument to different clients at the same time. If you are looking to actualy bet or trade of the FTSE Future then you would be best looking at a DMA provider. This may not be suitable for traders who like to do a pound a point due to the fact that the position size has to be of the full value of the contract.

Hope this helps
Alex

You are way too "pro" your own platform model and way too negative towards the major SB companies.

____________
"Take control with Risk & Money Management"
Planning, Risk & Money Management

 

[gle101]

I've found city index CFD contracts and SB prices are much closer to real price than IG Markets. Spreads are a lot tighter too.

Yes Cityindex "future" prices follows that of the real future very nicely. With City however, there are other negative issues that I will not discuss on this thread.

____________
"Take control with Risk & Money Management"
Planning, Risk & Money Management

 

[FP Markets]

You are way too "pro" your own platform model and way too negative towards the major SB companies.

____________
"Take control with Risk & Money Management"
Planning, Risk & Money Management

Hi Gle

Sorry for sounding negative towards other SB companies, I was more try to explain the difference between the Market Maker model and DMA. I have found that many traders have not been introduced to DMA and what the actual Market Maker model entails. I am always going to be more pro towards our own model because I believe transparency is very important for firms. In creating our model we have taken into account complaints (many of which can be seen in T2W forums) regarding order rejections, re quotes, price manipulation, tiered margining, automatic stop losses and people being plain refused to be allowed to trade due to making too much money (not implying that all SB companies do this). With this we have tried to create a system that deals with these problems. All different companies have different benefits and drawbacks to their models and different companies will suit different styles of trader. FP Markets is not for every trader. We only appeal to certain spread betters who volumes, liquidity and transparency are essential.

 

[gle101]

Hi Gle

Sorry for sounding negative towards other SB companies, I was more try to explain the difference between the Market Maker model and DMA. I have found that many traders have not been introduced to DMA and what the actual Market Maker model entails. I am always going to be more pro towards our own model because I believe transparency is very important for firms. In creating our model we have taken into account complaints (many of which can be seen in T2W forums) regarding order rejections, re quotes, price manipulation, tiered margining, automatic stop losses and people being plain refused to be allowed to trade due to making too much money (not implying that all SB companies do this). With this we have tried to create a system that deals with these problems. All different companies have different benefits and drawbacks to their models and different companies will suit different styles of trader. FP Markets is not for every trader. We only appeal to certain spread betters who volumes, liquidity and transparency are essential.

No problem, but there are a lot of benefits using "real" SB as well. One can discuss if you model is good enough, especially from a price level point of view compared to that of trading the real futures (with IB for instance)? Is the tax benefit that important, yes maybe for some clients, who want to have real market experience under the hood of SB company, but it comes with a hefty price tag.

____________
"Take control with Risk & Money Management"
Planning, Risk & Money Management

 

[adatherton]

IG Markets CFD spreads (points in trading hours / out of trading hours)

FTSE, DAX, CAC 1 / 2
DJIA, 2 / 4
ASX 2 / 3
S&P 0.5 / 1
Nasdaq 100 1 / 2
Major FX 0.06 / 0.25
Italy 8 / 40
HK 12 / 40
Nikkei 12 / 30
Gold 50c
US WTI Oil 6c / Brent 10c

Are these better than spreadbets. Also everything except oil is permanent, no option expiration, and oil can roll over although you do get contangoed.

 

[lucas_king]

Hello there,

I am SB the FTSE 100 with IG Markets, and there is the usual difference between the real cash price and the SB price. Eg, real will be 5 points profit, and SB will only be 3 ect... after spread ect...

I was wondering would a CFD FTSE Contract be more close to the real price than the SB price? As I think they are meant to mirror the price, or is a market market maker, a market maker at the end of the day?

Or would a FTSE Futures SB price be closer to the real Futures, as that is a real traded instrument?

I think that IG are the closest to the real cash price, ETX I find are way off, although their Gold Prices are spot on to the real cash rolling.

Thanks

Where are you getting your ‘real cash price’ from?

You’re saying the difference in your profit is seen ‘after spread etc’, so perhaps it’s the spread that it causing the discrepancy?