Is is better to use CFDs or spreadbetting to invest?

[dpelliott]

I am just considering starting to invest with only £100 to start with just to see how things go

I know i can open up a cfd account with MiniCfd's for £100 and trade at small amount to start with and i can also open up spreadbetting accounts with a similar sum of capital.

I am looking to trade matbe the DOW, FTSE and NASDAQ sets and also some individual stocks.

I that you have to pay commission on CFD and have got stamp duty but which is the better method of trading?

i.e which is going to work out cheaper.
I figured CFD's would cost around £13.50 to hold a £100 position for a week(I think).

Which do people think is better and Why???

 

[henry766]

don't cms have same spread for cfd and spread bet? and i think cheaper than the price you seem to have dp.

 

[dpelliott]

The price i got from the examples at http://www.minicfds.com
(obvoisuly cfd prices)

they seemed to charge 0.25% commission on the ungreared amount and then a very small amount of interest which made it seem to work out cheap?

I just looking at which is easier to make money investing with

 

[BF1]

In my opinion, I think £100 could be just too small an amount to start and you could easily get taken out with the spread alone just after a couple of trades, unless,of course, you started off on a good run!

To protect your core sum as much as possible, you would have to have very tight stops.

 

[anley]

Yes, £100 is really far too small.

£500 minimum, better still £1000

 

[henry766]

i think at cms cfd and spread bets are virtually identical

 

[Splitlink]

I am looking to trade matbe the DOW, FTSE and NASDAQ sets and also some individual stocks.
Which do people think is better and Why???

With £100 you could try Financial Spreads and trade the indices for 10p a point to see how you get on. This is for practice runs. For rolling bets on shares they require margin of 5% so you could trade there for £1 and you would have spare cash for a few repeat shots while you get confidence.

I'm not a great believer in minimums of £1000 and up to start with. The impatience of youth! I started with a larger sum but it really isn't necessary while you get practice. Afterwards, yes, you need to put capital in to make a decent return. Then you can go to CFDs.

Good luck with what you do

Split