SB v CFD v Forex v Futures

[vincentl]

Hi - has anyone got a model or is there a site or publication that clearly lays out a detailed comparison of the pricing and all other aspects of the various different trading instruments (margin etc) please?

I really need to get to the bottom of the detail here (pricing especially) to see the relative benefits - it seems to me that no one can really demonstrate a strong argument to trade SB for example and that SB is only really a choice driven by ease of set up and facilitation, personal preference and psychological factors such as 0% tax, rather than a true outright economic advantage.

Thanks

 

[RMcTie]

Hey - Totally agree about the SB. Heavily advertised with large leverage ratio, tax aspects etc. Does anyone know of a broker who offers an advisory service on SB?

 

[Vaco]

hi Vincent, RMc

Sb is more expensive then direct access, The tax benefits are not something to consider until you are making a profit larger then your CGT allowance at which point you could do the maths and figure out which route is better for you.

That only leaves 1 real advantage and that is the reduced risk per point vs futures.

However for a novice i would say start with forex as you can trade as little as 6p (0.01 lot) a point indefinately where as with most sb's its £1 a point.

 

[Sunshine On Leith]

SB is not necessarily more expensive than DMA. Often the SB firm will make their prices innefciently versus the real market giving you a chance to trade at a better price than you could with DMA.

In an ideal world you should have both SB and DMA trade on SB if the skew is in your favour. Then its often possible to trade with no real spread or tax.

 

[montmorencyt2w]

I also think that the tax situation is a little more complicated than the way that has been described.

The more I look in the tax and accounting threads, the more (at least as a part-time trader) I want to remain with spread-betting.

 

[Sunshine On Leith]

I agree with that, as far as Im aware its pretty difficult for a reasonably succesful trader to only pay CGT these days. Income tax seems to be the IR preffered route these days and so your SB firm would need to be horrendously bad not to offset the possibility of 40% (soon to be 50%) tax.

 

[vincentl]

All understood and thanks for the feedback but this still doesn't give me the detailed comparison I am looking for

Cheers

 

[pavelsg]

It seems you should make your own R&D.

 

[Sunshine On Leith]

Im afraid Ive never seen such a comparison.

However your trading style should rule out some of these options to make your research easier. eg if youre a scalper then dont bother researching SB