Newb questions : Price per point query

[Singhstyle]

Soz for a new but I was trying to get an handle on price per point in SB.

In essence what I want to understand or find out where can i go to find out what a stock price movement per point is e.g is the stock price priced per point by

• 1
• 0.1
• 0.01
• 0.001

E.g if a share is price ay 2409.1... what is the price movement i am laying my bets against.? is is movement before the decimal or after the decimal?

I tried google but now joy..

Thanks in advance and be gentle with the nubia

 

[londed]

There is no standard price movement per point. Each spreadbet company will set there own.

If we take your example of a stock price of 2409.1
If the price moves to 2408.1, Spreadbet Company A may define that as a 1 point move, whereas Spreadbet Company B may define that as a 10 point move.

You need to check each bet with each company before you make the bet.

 

[yellowfloyd]

Soz for a new but I was trying to get an handle on price per point in SB.

In essence what I want to understand or find out where can i go to find out what a stock price movement per point is e.g is the stock price priced per point by

• 1
• 0.1
• 0.01
• 0.001

E.g if a share is price ay 2409.1... what is the price movement i am laying my bets against.? is is movement before the decimal or after the decimal?

I tried google but now joy..

Thanks in advance and be gentle with the nubia

No apology needed. Trading is a continual learning process and spread betting can be confusing at first. I’ll do my best to clarify.

UK stocks are always quoted in pennies and so it’s always the number before the decimal point that’s counts.
However, the absolute price does make a difference with a 1p move being a lot for some stocks and next to nothing for others.

On a high priced stock like RIO (3232.4p), it doesn’t take much for it to move up or down by 1p (0.03%).
On a lower priced stock like VOD (209.9p) however, a 1p move up to 210.9p or down to 208.9p equates to a bigger move (0.5%).
Both involve 1p moves but you’d be making or losing more for every 1p move on VOD than you would for RIO.
Lower priced stocks trade with more decimal points to allow them to trade in the same % increments as higher priced stocks.

£1/point = equivalent to holding 100 shares; £10/pt = 1,000 shares; £50/pt = 5,000 shares.

£1/point on Vodafone for example = £210 exposure (£1/point X 210p share price). If the price rises by 1p to 211p your £1/point trade is now worth £211. You’re up £1/point as your shares are up 1p.
£1/point on Rio Tinto = £3,232 exposure (£1/point X 3232p share price). So if the price rises to 3,233p your £1/point trade is now worth £3,233. You’re up £1/point as your shares are up 1p.
The above can be scaled up by using the below.

For every £1/per point trade, a 1p move = £1 gain/loss; For every £10/per point trade, a 1p move= £10 gain/loss; For every £100/per point trade, a 1p move = £100 gain/loss; For every £1000/per point trade, a 1p move = £1,000 gain/loss

The more contracts you trade and the more pennies the price moves the more you stand to win or lose. The higher the share price the easier it is to see a 1p movement. But the higher the share price the bigger the trade size and the more margin you will have to put up. Swings and roundabout

 

[barneydunn]

No apology needed. Trading is a continual learning process and spread betting can be confusing at first. I’ll do my best to clarify.

UK stocks are always quoted in pennies and so it’s always the number before the decimal point that’s counts.
However, the absolute price does make a difference with a 1p move being a lot for some stocks and next to nothing for others.

On a high priced stock like RIO (3232.4p), it doesn’t take much for it to move up or down by 1p (0.03%).
On a lower priced stock like VOD (209.9p) however, a 1p move up to 210.9p or down to 208.9p equates to a bigger move (0.5%).
Both involve 1p moves but you’d be making or losing more for every 1p move on VOD than you would for RIO.
Lower priced stocks trade with more decimal points to allow them to trade in the same % increments as higher priced stocks.

£1/point = equivalent to holding 100 shares; £10/pt = 1,000 shares; £50/pt = 5,000 shares.

£1/point on Vodafone for example = £210 exposure (£1/point X 210p share price). If the price rises by 1p to 211p your £1/point trade is now worth £211. You’re up £1/point as your shares are up 1p.
£1/point on Rio Tinto = £3,232 exposure (£1/point X 3232p share price). So if the price rises to 3,233p your £1/point trade is now worth £3,233. You’re up £1/point as your shares are up 1p.
The above can be scaled up by using the below.

For every £1/per point trade, a 1p move = £1 gain/loss; For every £10/per point trade, a 1p move= £10 gain/loss; For every £100/per point trade, a 1p move = £100 gain/loss; For every £1000/per point trade, a 1p move = £1,000 gain/loss

The more contracts you trade and the more pennies the price moves the more you stand to win or lose. The higher the share price the easier it is to see a 1p movement. But the higher the share price the bigger the trade size and the more margin you will have to put up. Swings and roundabout

I adjust the position size of my trades based on risking the same amount of money on each trade but taking into account the volatility of the share. I use ATR and always risk 2 x ATR as the stop loss so I have coded an indicator for mt4 which tells me the Spread, the ATR, what position size I would need to use to risk my desired risk per trade over 2 x ATR and how much margin that trade would use.

I'm not sure what options you have for other platforms but it's a simple enough calculation if you can get the ATR figure.

 

[luckystrike23]

this should help: What is a Point/Pip/Tick?
http://www.financial-spread-betting.com/Point-pip-tick.html