i cant get my head round why we spread bet when we can have E-mini Stock Index Futures? what is the fundamental difference between the two? can anyone shed some light on the pros and cons of each in terms of trading
Hi Destiny, if you look around the site there is plenty of information about the difference, but most people myself included start with spread betting and treat it as a primer for futures, it allows you get the feel of trading with real money and you can open an account with a small amount of money, but if your looking to scalp or trade fairly small movements unless your gifted you will find it hard work, i found if using a long time frame it was ok but didn't suite my personality, trading futures using direct access you get the price on the screen with the odd point of slippage and a small spread, the spread betting firms can and do move the price in there ,although they refer to the cash index i believe that they are really looking at the futures index, im sure there are more knowledgeable people on here who can add a bit to this.
if you want to spread bet use a small % figure of your available capital for the size for your stake . stick with this and do not change , use 50% of your available capital for total margin only. keep the other 50% as back up do not trade the daily cash , use the 3rd month futures (at present March ) for all bets, find one Index or commodity only to trade and stay with it do not trade shares place bets in stages and when you close . close all bets as one total amount . this works for me, I have just closed 4 positions ( WEd ) on the Dow and so far my best run of wins before a loss is now at 31 bets be lucky and do not over/margin yourself. twiglet
Destiny you are trying to compare apples and oranges. Spreadbetting is a METHOD of trading. And Emini futures are a PRODUCT you trade. You could of course combine the 2, and spreadbet e mini futures...
It took me a while to realise that it is difficult to make money with spreads whilst eminis are fairly easy. Once you remove the historic image of eminis they are the obvious way to trade! The reason being that the spread on minis is much tighter. A quarter of a point on S&P and half a point on the Nasdaq. If you muse a good systerm it is easy to scalp the Nas intraday.
IMO SB can only work for directional trades but if you run a system over time and compare the slippage of paying up the spread through a SB Vs. trading at the market you will realise the large PnL difference.
I use CMC myself when I want to have a punt in a market I do not have a direct connection to.
I spend my days trading LIFFE futures and the spread for those products on the SB's is so wide I would not touch it.
Depends on the amount you want to trade with. $5000 deposit = one contract at $50 on the S&P and $20 times 2 or 3 on the Nasdaq. The Nas has a half point spread. If you use Q Charts witth ROC 9
Macd 7 15 9
and volume you should be able to scalp. Not today though!http://www.daytrade4less.com/ is a good start until you go to the Sovereign Group for Offshore, I am told.