Shakone
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I think Mike Ashley made a bet of the size 800,000 per pence on HBOS, and lost 300 million or so. So the size can get quite big, but you'd have to suffer a much widened spread nd obviosuly forget about doing it online. 500 per point really isn't that much in comparison.
:cheesy:
in the unlikely even that someone trades £500 a point and makes £20k a day with a spreadbetting firm- where is the limit? surely they wouldn't let you take millions a year?
has anybody had such problems?
now seriously
If you were doing that consistently, I think they'd love you. Obviously, you'd be on dealer referral, but all the SB would be worried about is getting hedged and then shadowing your trade.
I remember a couple who bet short on a software company (Sopheon?) a few years back now. The price kept dropping and they kept adding to the position. The SB company (Fins I think) kept offering to them to close the position but they hung on until they took out over a milllion profit. The firm made quite a bit of publicity on it. I never heard anything more about them but what the heck? how many times does anyone need to make a million?
Luminox
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Not entirely sure why Fins would encourage them to close the position given they'd likely be profiting from their spread through fill-on-fill offsetting. But then I haven't read the story, and I'm not about to.
Not entirely sure why Fins would encourage them to close the position given they'd likely be profiting from their spread through fill-on-fill offsetting. But then I haven't read the story, and I'm not about to.
Maybe they hadn't hedged it?
shadowninja
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This is why you have to be careful which company you choose. Some will hedge your bets or play silly buggers to knock out your position, others don't care as they just take your trades, too. Caveat emptor.
Luminox
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Maybe they hadn't hedged it?
Why employ a spread if successfully taking the other side of the market consistently were certain?
Erm... Not sure I follow that?
scose-no-doubt
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He saying they make money off of spread not betting against you as it;s not certain. However, I've seen a statement on this site somewhere (I think it was from IG) showing customer profits and losses over the financial year.
Something like >95% lost money so I'd say taking the opp side to all clients would be a fairly certain bet, especially if you look at the £pp they trade. Anyone who's doing 100+ per pip obviously has an idea what they're doing or is an idiot so I'd just monitor their account for a bit to see whether they actually make money or they are just some gambling winnet. In the case of the latter you could take the other side of their trade too.
Simple really.
Plus you make spread as well!
Something like >95% lost money so I'd say taking the opp side to all clients would be a fairly certain bet, especially if you look at the £pp they trade. Anyone who's doing 100+ per pip obviously has an idea what they're doing or is an idiot so I'd just monitor their account for a bit to see whether they actually make money or they are just some gambling winnet. In the case of the latter you could take the other side of their trade too.
Simple really.
Plus you make spread as well!
Wouldn't there be liquidity problems at that price £500 pp?
How much would dealer referral slow down the process, wouldn't they scalp your trade via dealer referral?
Luminox
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If clients were guaranteed to lose, it wouldn't make much sense to employ a spread; make the price more attractive (i.e. negative spreads) thereby gaining volume and wait for profit.
The concept of the spread is such that it allows a return for the broker should its net position remain neutral.
