I have been reading and learning about various trading methods for the past few months. Having played with several virtual trading platforms as part of my learning process I have had excellent results thus far. Now I want to do some real trading but as I am still learning and working out my system I will be trading small amounts. Should I go with spread betting?
You may well find that spread betting is one of the simplest ways to get started. Depending on the company you choose to open an account with, you will also find that it will enable you to trade with relatively small amounts to start off with. As an example, Deal4Free will allow you to bet £1 a point on currencies, indices and shares. That is quite good as it provides the opportunity to get comfortable and feel your way without incurring major losses in the process (very important). Paper trading and the real thing are very different as you will sonn find out. There are some companies that will even accept smaller trades, I believe that Finspreads is one of them (please note that this is not an endorsement of either company).
I was leaning towards spread. In my other life I have been a pretty good poker player so psychologically I am a lot less adverse to financial risk than many others I imagine. Are there any good threads dealing with SB methods; I have searched the forun but not really found a cogent discusson on strategy.
There are all sorts of threads and you will have plenty of reading to catch up with. Best to look for any thread relating to spreadbetting. As for strategy.... there is a raging debate going on at present called -
Is it really possible to make money in this lark? Happy reading.
Is it really possible to make money in this lark? Happy reading.
Trading strategies vary greatly from person to person.
You can hold a position for seconds or for years and the system you use for getting into or out of a position can have almost infinite variations.
Think of what you did when you were trading on the simulators. Did you have a particular set up you looked for when you decided to get into a trade, why did you exit the positions. Which trades worked and why do you think the losers didn't. How long did you hold the stock for?
If you think about these it may help you when trying to focus on a particular strategy / style yourself. There are lots of different ways of making (or loosing) money. You need to find a way that suits you and your personality, tolerance to risk and what you are most profitable at.
If you are good at poker then you probably already know how to do this with your poker game, just use the same analytical skill on trading now.
As far as spread betting is concerned, I too agree that it can be a great way to start. It has it's problems, but it also has it's advantages such as only needing small amounts of money to start and having a 10:1 leverage on your account.
The shorter holding periods don't work well with spread betting though, as you have to cover the spread before making a profit, and when you exit at a loss when the trade isn't going your way, the spread also adds to your cost.
In my opinion, holding over 2 or more days is more suited to spread betting than opening and closing positions in the same day (intra day or day trading as it is known).
You can hold a position for seconds or for years and the system you use for getting into or out of a position can have almost infinite variations.
Think of what you did when you were trading on the simulators. Did you have a particular set up you looked for when you decided to get into a trade, why did you exit the positions. Which trades worked and why do you think the losers didn't. How long did you hold the stock for?
If you think about these it may help you when trying to focus on a particular strategy / style yourself. There are lots of different ways of making (or loosing) money. You need to find a way that suits you and your personality, tolerance to risk and what you are most profitable at.
If you are good at poker then you probably already know how to do this with your poker game, just use the same analytical skill on trading now.
As far as spread betting is concerned, I too agree that it can be a great way to start. It has it's problems, but it also has it's advantages such as only needing small amounts of money to start and having a 10:1 leverage on your account.
The shorter holding periods don't work well with spread betting though, as you have to cover the spread before making a profit, and when you exit at a loss when the trade isn't going your way, the spread also adds to your cost.
In my opinion, holding over 2 or more days is more suited to spread betting than opening and closing positions in the same day (intra day or day trading as it is known).
There's a whole thread here under the name CapitalSpreads that you might want to look at.
Re the comment above about Finspreads taking smaller positions than £1: I believe this only applies for your first 8 weeks with them. CapitalSpreads and TradIndex (both of whom I use myself and prefer to other SB companies) both offer a "play money" facility if you want to get the feel for their platforms before committing your hard-earned poker winnings.
Re the comment above about Finspreads taking smaller positions than £1: I believe this only applies for your first 8 weeks with them. CapitalSpreads and TradIndex (both of whom I use myself and prefer to other SB companies) both offer a "play money" facility if you want to get the feel for their platforms before committing your hard-earned poker winnings.
