Does buying cover selling?

[davidc123]

Hi,

I'm looking into spread betting and I've got a very basic question on closing positions that I just want to be sure of before I do it...

IGIndex let you attach a stop to a position, but it can't be within a certain amount of the current price. So I'm wondering if, say you were long, instead of attaching a stop too far away from the price, could you just setup an 'order to open' stop order to sell for the same £/point at the desired stop level? Or is there something else I'm missing?

Thanks.

 

[shadowninja]

I suppose you could. Try it and let us know.

 

[davidc123]

well I gave it a go.... didn't work. I ended up with a long position and short position, and needed to close both incurring extra slippage + spread fees....

What a ballache. Can anyone explain why they have minimum distances from the market on stops attached to positions?

Are there any SB's that don't have such rules?

 

[davidc123]

Am I missing something here? How does anyone manage their risk effectively when you can't always put a stop at the level you want?

What do you guys do to get around this?

 

[dimsdaletraders]

I put my stops as close to where I want them as my SB account will let me, but then take that extra spread into account when I calculate position size, so it doesn't have any impact on my risk, I'm still always around 1% overall (or whatever). Equally, I've only been trading for a few months, so PLEASE don't assume that's any kind of definitive answer! Also, I think it makes a huge difference what kind of trading you are talking about. On EOD positions like mine that can last days/weeks it isn't much of an issue, whereas if you are intraday trading/scalping/whatever, it's going to be very different.

Maybe if you add a lil info about what kind of trading you are doing, and in which markets, one of the guys on here that knows a lot more than I do will be able to give you more help?

GL
Tess

 

[mb325]

AFAIK IG has one of the best minimum stop distances for most instruments. I tried out CMC's platform a while ago and their min distance was much larger on almost everything.