hi ross
come on it is christmas. tomorrow is my last day in the office having not had holiday this year. can you say something positive for once.
Peter
My real name is Captain Positive!
hi ross
come on it is christmas. tomorrow is my last day in the office having not had holiday this year. can you say something positive for once.
Peter
Good answer, well explained.
Presumably the only way round this would be to only offer 'bet' sizes that are 'available' on the underlying exchange e.g. for FX pairs starting bets of the equivalent of 1.0 lots etc. i.e. much ike Pro-spreads do - they use currenex liquidity on FX pairs and add there own spread to cover their costs (i.e. they are STP) but you can only bet in standard whole lot sizes i.e. 1.0 (which is the equivalent of $10 per pip for EUR/USD for example) and thus this approach would really only be aimed at the serious spreadbetter with a decent account size and not the mass market.
My real name is Captain Positive!
PC, at the moment a lot of this is yesteryear experience and/or conjecture and opinion with little substance and if the point of this thread really was to prove you actually give a sh1t and believe in your product(which I believe to be the case) rather than just pasting your name over a forum for rankings, you have to admit it's not going your way at the moment
Why not give us (new/potential customers) a no nonsense, no small-print, no boll0cks, 30 day £XXX risk-free, deposit claw-back type offer to try out your system. If it your platform and services really are any good I'm sure people will let it be known.
Hi Luc.Chase
Baffle no more let me try explain some of the reasons. Please accept this explanation as a general explanation as the subject is quite complex and full of regulations around spread betting but anyway let me explain first and come back to me if you need to.
Firstly, it is important to understand that if you want the tax benefits of spread betting then you have to open a bet not a financial trade. In other words you cannot deal on exchange and say you are betting.
You need to bet with a counter party (book makers licence holder) so they are the counter party to your trade. In effect when you bet you are betting with a book maker even though you are betting on a financial product.
Because there is no cgt on your winnings the government have to collect their tax some where along the line so they charge a levy or performance fee, which is passed onto the betting client and this has to be built into the spread bet price, in other words you pay the tax on the stake not on your winnings. Bit like on course and off course horse racing. we have to build this into the spread bet price for you to bet on.
In addition because you are betting with a counter party there are for example, clearing fees and market spreads that have to be built into the bet spread. We as spread betters have to quote you a price with all the costs, eg tax etc built into the spread and deliver to you a price to bet on. therefore we have to build our own internet betting platform for you to place your bets. remember you are not buying financial products, you are betting with a book maker.
Also because spread bet clients do not always transact in marketable amounts we have to deliver a price on a platform to you as opposed to a platform that will execute on an exchange.
I can assure you that if you see our platform as a toy it is a very expensive toy because we have to always remain competitive and transact real time. Competition is the best way to keep spread betters competitive and deliver really good technology. If you look at spread bet spreads now they are very competitive and we have to take all the above factors into account. when you trade on exchange the additional costs are take out, eg stamp duty, clearing fees, brokerage. when you trade on exchange you take the spread and the rest is added on. with us it is all built in because you are betting.
we transact thousands of transactions a day across 4000 real time products and the pricing has to be spot on otherwise we would lose business quickly. We need our own platform to deliver all of the above.
That in a nutshell is why we have to build our own platform and why we basically cannot use ninjatrader etc. hope that helps. best wishes peter.
ps please dont tell my team of 250 developers and technicals that they have been working on a toy for the last two years. it will depress them this side of christmas.
fair enough... worked for etx though
of course not
same reason you're here talking up your firm :S looking out for my interests
Hi Lovejoy
it is not about size of the bet but as much as they way you bet.
with spread betting you have to bet pounds per point so you have to transact with your book maker. you have to bet not transact otherwise you lose the no cgt part of the deal.
we all have liquidity providers and there is nothing scientific about this but we have to deal with all levels of bets some fractions of a contract size some normal contract size and marketable amounts.
it is really all about making sure that when you bet you bet so you get the no cgt tax advantage. you as the punter can decide whether the quote is good or bad. that is always your choice. the spread betting companies are competing for your business so unless spreads are consistently good you will just go elsewhere.
what we do is publish a spread chart real time for each instrument. you can select it from our demo page. we are transparent about our spreads so you can see for yourself.
thanks for your blog. appreciate it.
ps remember you are betting not trading. if you want to trade and pay cgt open a cfd account with us.
peter
Prospreads isn't really DMA.
Care to elaborate as to why it's not DMA?
Because I don't think it would qualify as spread betting if you were accessing the markets directly, as PC was expounding about earlier. The claim is 'DMA functionality'. Check out previous threads on Prospreads and FuturesBetting.
Prospreads are very expensive, I rather trade the futures with someone like IB. I only see a reason to trade with Prospread if the tax advantage makes a different at the end of the year.Yeah I understood that, should have clarified it's 'DMA functionality' in that it has the same affect as if you were accessing the underlying market (i.e. you get the liquidity providers prices + the fixed spread added by PS) in terms of the tight spreads, instant execution , level 2 order book etc. Obviously you can only bet in contract sizes normally available on the underlying exchange i.e. the sizes that PA can hedge at.
Even with true DMA you are not accessing the underlying market yourself...the broker is doing it for you on your behalf, it's just you would pay commission instead of paying the spread...so I guess this is how PS can call it SB as they are taking your trade orders and just instantly hedging them and gaining from the spread rather than placing your trade directly through to the exchange and charging you a commission for it.
On a side note I checked out the demo platform...platform looks good, lots of bells and whistles if you utilise stuff like that. Operates fine in terms of speed of access.Being NND would suggest exeuction is consistently better (though being NDD doesn't really tell the whole story) than a traditional market maker with a dealing desk so I'll take CMC's word on that...so far all demo trades have executed fine. The spreads over a period of time are pretty average IMO compared to other SB market makers, nothing that stands out as being better than their competitors but Peter did say they would be decreasing spreads soon (I think I read that somewhere on this thread). So for me they would need to decrease the spreads to get me on board as I can get better spreads elsehwere...slightly better spreads combined with the execution advantage of being NDD and they would be added onto my SB list (I utilise 3 SB brokers at any one time).
Prospreads are very expensive, I rather trade the futures with someone like IB. I only see a reason to trade with Prospread if the tax advantage makes a different at the end of the year.