Spread Size Variations

[hagadol]

Hi - When Spreads size change do the change equally either side of the mid price or can it vary ? If the later what are the considerations ?

 

[StockBaron]

If you're talking about SB spreads, they will bias the spread depending on their strength of feeling on the underlying's potential strength and direction.

If they have a strong conviction the underlying is set to rise they will bias the spread with the mid-point toward the lower end of the spread. Obviously the opposite if they believe it's set to drop.

 

[juanbyte]

Spreads follow the nearest futures price and not the cash price of indicies.

 

[stevespray]

Also on Spreadbet quotes you may find that the quote varies away from the 'mid point' based on the companies particular order book. If, for example on dow, a compnay finds itself with an increasing number of short positions it may start to lower its price in order to discourage any more sellers and attract a few more buyers which, the company hopes will balance out its overall position towards neutral. This is quite rare but it does happen mainly in quicker markets.

Hope this helps,
Steve.

 

[Philip]

I have had the spread moved against me, too often for my liking.

The alternative, I suppose, is to go with a regular (non spread betting) broker. Any suggestions or recommendations please.