Spread betting - £30k - £60k in 12 months

olivertomahawk

Junior member
25 2
Good luck mate!

Just a couple of questions for clarity:
- do you do this full-time?
- do you use some 3rd-party software or do your homework manually?
- how long have you been spread-trading?

Thanks!

- do you do this full-time?
No - I have a full time job in a bank for my sins
- do you use some 3rd-party software or do your homework manually?
I do my own research
- how long have you been spread-trading?
dabbled in it for probably 4-5 years. Never enough to make a difference to my life. I have traded stocks though for probably close on 10 years now. Long term always though.
I am keen on spread betting for short term gains.
 

olivertomahawk

Junior member
25 2
OK, I apologise for saying "If it was hard-earned....." At 80 years of age, I have not got around to the fact that I could retire on 30,000 GBP when I was young! Now it is a year's pay., so you can see that I would value a sum like that, immensely.

Nevertheless, I would warn you. The financial markets are a jungle and you seem
innocent, to me, Take all the advice you can get and start small so that you can come back. Once it is all gone, you are out of the game.

To answer your question. With that money I would invest in shares. Sharescope is a good tool for that. They will download you a free sample. Start with being able to identify growth shares. Jim Slater's "The Zulu Priciple" is a good, readable, book, If you understand that, you will be well on the way.

Thanks for the warnings and advice. I will take both on board.

Btw - I have read The Zulu Principle. And I agree, very good book.
 

Splitlink

Legendary member
10,850 1,234
Thanks for the warnings and advice. I will take both on board.

Btw - I have read The Zulu Principle. And I agree, very good book.

His PEG idea has stood me in very good stead. Of course, times have changed and we are in a financial crisis, but his system of earnings growth over 5 years plus low tolerance on debt has thrown up some good takeover situations. Sharescope can help sort them out. This is investment. What is mainly dealt with on this site is trading---a different animal, altogether. PEG will make sure that you pick reliable companies, although they will not be in the FT100 because they will be low capitalised companies. Stay away from penny stocks by not accepting companies with less than a certain capitalisation.

Anyway, good luck, whatever you do.
 

mikeeg

Member
97 13
Just to chime in with some advice. You sound like you are going to be trading short term individual shares. You can undertake and have the best fundamental analysis available but in my view you need to apply very sound money/risk management with this approach otherwise you will find your endeavours to be very short lived. When I started trading I was naive and didn't place enough importance on money management. Now that I do it's changed the game completely for me. Good luck.
 

olivertomahawk

Junior member
25 2
Just to chime in with some advice. You sound like you are going to be trading short term individual shares. You can undertake and have the best fundamental analysis available but in my view you need to apply very sound money/risk management with this approach otherwise you will find your endeavours to be very short lived. When I started trading I was naive and didn't place enough importance on money management. Now that I do it's changed the game completely for me. Good luck.

Thanks!
 

Rupert206

Member
78 22
So you're up £23k since December? Thats pretty good going on a 30k pot. Impressed with the performance, looks like you will be hitting your target pretty soon if this run continues.

Had a look through your blog, it appears that all the trades are long? is that correct?
 
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olivertomahawk

Junior member
25 2
So you're up £23k since December? Thats pretty good going on a 30k pot. Impressed with the performance, looks like you will be hitting your target pretty soon if this run continues.

Yes - thanks.

Have had a great run so far. A mixture of good picks, luck and obviously helped by a storming bull market. Conditions couldn't be better really.

Sitting at around £25,500 up at the moment.
 

Rupert206

Member
78 22
I noticed you got off to a bad start initially but picked up once the fiscal cliff got sorted and markets started rallying. Your system seems to do well in a trending markets.

Are you looking at any short setups to make profit on the way down should there be a correction? seems like all your trades are to the long side at the moment.
 

Rupert206

Member
78 22
btw agree with your blog post about letting the stops get hit and not closing out early. I've had many a moment where if I had left the position alone to get stopped out as per original plan rather than interfere then I would still be in the position and sitting on a nice profit.

Good example of this is with SPD. One that you've also got a position on. I entered at 385p and shortly after results it spiked down to 355. Original stop was at 345. I got spooked out and closed the position, only to see it carry on going up from there onwards.

I Need to be more mechanical than discretionary it seems. Hard to achieve at the moment.
 
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olivertomahawk

Junior member
25 2
Rupert206 - I am fairly bullish at the moment. I know the market is due for a correction sooner or later but at the moment I am still bullish.

But, that said, I do need to think about a hedging strategy. Maybe open a short bet on the FTSE, not sure really.
I have hiked up my stops on all my trades that have hit my initial target though. I hike them right up to lock in profits so the market could still tank and I would be ok. I would lose a lot of my profits I am sitting on now, but overall I would still be up over £10k (and that's assuming every position I hold now hits its stop which is unlikely)

With regards to mechanical trading versus discretionary; I agree, it is very hard to stick to your guns. Especially when markets are like they are at the moment. I am definitely an over trader but am learning from my mistakes.

I sold Barratt Developments and Taylor Wimpey the other day even though they had not come close to my targets but they were just going nowhere and I sold both for a profit which was great. Discretionary but I feel the correct decision.

SPD - I actually sold out yesterday, hit my targets and got sold out by my stop. Am happy with the gain. My initial target was 420 and I sold out at 429. SPD is trading at around 419 today so I am glad I got out. My stops are doing what the are supposed to do it seems!

Do you spread bet or buy the underlying?
 

Rupert206

Member
78 22
Oliver,

I’m spread betting too. Stocks as well as currencies. Good trade on SPD, wish I had held on or even re-entered after getting spooked out, it would still have ended up a profitable trade most likely.

I’m trying to be a position trader, trading with the trend, buying on pullbacks if the trend is up and shorting on rallies if the trend is down. Pretty simple system just using trend lines and moving averages.

I find getting into the positions and setting the initial stops and target easy. The losers get stopped out automatically on most occasions and the winners start running. The problem is managing the winners! I want to ride the trend for as long as possible. But this becomes difficult the longer the trend goes on. Especially if the prices starts going vertical. You think it can’t go any higher as it’s so far away from the trend line. So you use your discretionary judgement and close the position…However the position keeps going and you miss all those points had you stuck to your original plan which was to let the winners run. Tis a difficult balance to achieve.

How are you going about setting stops once a position is well into a profit? You don’t really want to ratchet up the stop too much close to the current price in case you get stopped by rouge stop hunting spikes, but you don’t want it kept at the original stop either as you would end turning a winner into a loser. I feel some kind of rules would help, but I’m not entirely sure what would be good rules.

For example you closed out BDEV. However the trend is still up. It’s continuing up today. In fact it’s a lovely uptrend, with a clear lower trend line and an upper trend line. Yet you used discretion to close out the trade. The trend may continue for some time yet, but you’ll now miss any further upside. Now you have to do the hard work again and look for another entry or another stock completely. You said yourself it hasn’t come close to your target, so really you should probably still be in this trade, with some kind of stop loss strategy to stop you loosing what you have already made. Now if you find any good stop loss strategy please let me know because that’s the problem I’m currently having on winning positons!
 

olivertomahawk

Junior member
25 2
What broker do you use olivertomahawk? Thanks in advance.

Whoever provides the best spread really !

There are loads of them out there. Register for a free account and try their software, see who gives you the best spread etc.

I have five or so accounts that I use.
 

olivertomahawk

Junior member
25 2
Rupert206,

I agree that it's hard to know when to let your bets run and when to call them in.

With BDEV, I lost patience with the bet to be honest. I held the bet for almost a month and it went nowhere fast. Up and down but mostly down so when I saw a profit I took it. I'm not sorry I did to be honest, I know it continued its run up but I have a 'kind-of' rule that if a bet doesn't go anywhere in a month I will cut it.

With regards to moving stop losses up once the bet has hit target; this is a bit tricky. What I normally do is set my target at 1.2:1. I used to set them at 2:1 reward/risk but lately have been setting them at 1.2:1. As soon as they hit this target and sometimes sooner, I will hike the stop loss right up to the break even point to lock in that at least. I then monitor the ones that have hit my target daily (often intra-day actually) to move them up as required to lock in further gains. Doing this works well for me and some of my bets end up being 2:1 or even 3:1 !
 

Cocoz

Junior member
23 1
Well done you for doubling your capital in such a short time.
Therefore from November after the fiscal cliff up to the beginning of March even a monkey could have made money, you just needed to throw it here and there. I had long positions open that I couldn't believe myself how much every day they were going up for not reason even after a 40% gain in very short time. All overbought indicators were ignored.
With this I'm not putting you down, you have been good but that was an exceptional bull time as you said. Don't expect to make 30k every two months because when the markes are going nowhere it's though to make big money.
Good luck
 
 
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