ignorance

V. III

Junior member
Appreciate if the following can be answered:

1. What is the difference apart from tax break between cfd and SB on d4f ?

2. how does IB futures account work ?

Thanks.
 

genti

Active member
indeed you will get the answer of any quest here at t2w.

the only difference is SB is only for residents of uk & Ireland and cfd's for anyone in the world.

i have a cfd and sb acc with d4f , i prefer to trade from the CFD one, because the SB prices sometimes are sexed up.

sorry havn't got a clue about IB, however i should say that if you are day trader in stock with d4f you will get no-were.

rgds
Genti
 

V. III

Junior member
SB prices sexed up..... do you mean they widen the spreads to according to their exposure ?

get no-were... ?????????
 

rossored

Senior member
I have just moved to IB from a SB broker and although their trading platform is a bit antiquated, it is refreshing to see the actual market price reflected in the quote, rather than the SB price, which imo is subject to slight bias.

SB prices (for indices, anyway) are based on the underlying futures price, which account for some of the fluctuations in SB prices : ie when the futures start to move, they move faster than the cash price, and this is reflected in the bookies quotes, but not of course in the cash chart of that instrument, which is always a little late.

However, I would not recommend that you jump into using IB without some good knowledge of the industry, as you will most likely get your fingers quite badly burnt. Probably best to learn the ropes using a SB broker for either SB or CFD's.

The tax benefits are clear : there is no tax applied to SB's as they are "a bet", there are taxes applied to CFD's and from futures trading.
 

genti

Active member
V. III said:
SB prices sexed up..... do you mean they widen the spreads to according to their exposure ?

get no-were... ?????????

i will call you VIP instead.

im sure rossored's info explains everything.
 
Rossored, i want to trade the dow, it seems that IB would be the best way to go about it, would i be right? PeeDee.
 
Has anybody took an average of how many points the dow moves in a day, wether it be up or down. PeeDee.
 

V. III

Junior member
Thanks Rossored, .....so the SB prices are not the same as the cfd prices I get on d4f?
Are the cfd prices not based off futures as well ?
 

rossored

Senior member
Peedee - yes, I would probably say that for any time frame, but especially short-term (ie intraday) then IB or another direct access broker would be the best bet because there is no spread - if you go long at 9050 (or whatever) then you're in profit at 9051, less commission and taxes. However, as I said, I would wholeheartedly recommend NOT jumping straight into trading futures without some good market knowledge, and I'm sure others on the site would concur.

I have been trading for nearly ten months via SB initially, and finally saw the light. However, I've done nothing but study and learn and most importantly practise (ie lose money) for those 10 months. Regardless, I think that money was probably as well spent as doing a couple of courses somewhere. I'm a firm believer in finding your own groove, although using other peoples experience and techniques will help you to accomplish this.

I don't know about the "average" points move for the Dow during the day - it can range from anything lately, 70 points up to 200 on a good day - so 140-150 on average I'd guess.
 
Cheers Rossored, i like the setting fire to your house bit(nice one!). The questions id like to ask is, what is an average commision i would pay using IB and what is an average minimum amount i would have to trade/point? PeeDee.
 

rossored

Senior member
If you're trading the e-minis then it's $2.40 to open a contract, and another $2.40 to close it, whether you make or lose on it. I dont know about other stuff but it's all listed on the website.

The mini dow trades in $5 contracts (about £3-odd), and you can obviously trade any amount from 1 lot upwards, depending on how much money you have / how big your gonads are, but trading single lots (as I am currently doing) has got to be the way to start.

The IB website will give you all the account opening minimums, etc www.interactivebrokers.co.uk
 

blash

Active member
peedee,

I did a comparison between the FTSE and the Dow on the difference between the High and the Low of each day since 1995 and then calculated the average.

FTSE=75
DOW=132

IB charge $5/£3 for each round trip on mini Dow (YM) and trades at $5/£3 per point.

Hope this helps.
 

Bigbusiness

Experienced member
The range for the dow has had periods when it has been much higher. At the moment it seems below average so I think there is going to be a dramatic increase in range soon.
 

peto

Established member
eminis are for nasdaq and s&p futures, Dow is traded through ACE exchange. You will be trading the dow futures not the actual index, they are a bit more volatile and faster to move
 

rossored

Senior member
The actual Dow? Not sure what you mean. The "Mini dow" as its called is so called because the contract size and margin requirement is smaller than the full amount. The "cash" price that is referred to in the papers/websites etc is driven by the underlying futures price, which is typically 20-30 points below the cash (This would be for a September contract, currently, which expires on the 3rd friday of the contract month at 8.30 EST)

Have a look at this site, it might help with your understanding of things:

http://www.cbot.com/cbot/dow/page/0,2611,1,00.html
 
Cheers Blash, the reasons why i am asking the question is because, if i get my TA off good and make good entry/exit points then i would like to start scalping. Anythoughts about scalping( because of the dows average point movements within a day and because of the small commisions with IB i thought the dow may be the best place to start.) PeeDee.
 

rossored

Senior member
Yes. If you're using Sierra and MyTrack, for example, you will need to enable the two no-cost options on "exchanges" in MyTrack (CbotDely and CbotLimt I think from memory) if you want a live feed, and then start a new intraday chart on the symbol Q`U.
 
 
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