Spreadbetting the FTSE100 - Made Simple (Not Mentally)

[Jack Hughes]

Anyone got any motivation techniques? Or preparation methods they use to help them get "In The Zone"?

Fifteen cans of lager for breakfast.

 

[pboyles]

Fifteen cans of lager for breakfast.

That'll certainly reduce your trading nerves.

By the way tomorrow is rollover day for index futures, normally we see some unexpected moves due to volume being split between contracts etc. At least that's how I've found it in the past. Next Friday is triple witching, another possible nightmare day.

 

[vchohan]

That'll certainly reduce your trading nerves.

By the way tomorrow is rollover day for index futures, normally we see some unexpected moves due to volume being split between contracts etc. At least that's how I've found it in the past. Next Friday is triple witching, another possible nightmare day.

Thanks for the heads up

 

[Black Swan]

I dont wish to sound unkind but I must have read 20 or 30 threads like this in the past year. Its always the same thing, spreadbetting on small accounts without really fully understanding what is going on. I think every single thread has quietly disappeared after a week or two of losses.

Regardless of how many people say 'demo trade until you know what youre doing' or 'dont scalp and spreadbet' it seems to be ignored in the face of blind optimism and hope.

Sorry if that is discouraging but that's how it is.

TBH I'm at the stage were I read' em and think each one is a wind up by a troll...Why do so many folk ask for advice and appear to be so fookin blinkered? Why don't they just shut the fook up, listen and do some research? In the few pages I've read this guy has had some top advice, particularly from one or two guys who actually trade the ftse index(using spread-betting) and nothing else..and still it's...

 

[vchohan]

Lol Is that meant to be me?

 

[vchohan]

The main benefit is that you are trading through a regulated exchange with other market participants. Presently you are effectively betting against a bookie based on the price the bookie decides to give you, not the true price of the market. They may widen the spread or move the price around to some degree as they see fit, you can bet it wont be to your advantage.

You are also scalping which SB companies frown upon if you are winning, although they are probably tolerating you as long as you keep losing.

When you trade futures your broker facilitates the trade and you pay a commission, they have no interest in whether you win or lose as its not 'their' money.

Regarding leverage it basically means you can trade at lets say $12.50 per tick (pip, point etc) for every $500 in your account (for the e mini S&P 500 that is). This is the maximum and would not be recommended unless you really know what you are doing and even then would be on the risky side. The point is that the leverage is available if needed, you dont need tens of thousands to get started.

The main point is that you will be seeing and trading true market prices, you wont pay a spread so you can in theory scalp for one or two points and still make money.

Do you have any links to a broker I could possibly use that charges small commissions? Will they provide a charting package? I just need a simple charting system. What is the smallest amount of capital I can begin with? Does it work similar to spread betting in the sense that you place a trade like £5 per point?

Blackswan I do appreciate all the advice that's given on here but for me this was meant to be a learning lesson and a test of my ability. This was just meant to be a journal of my thoughts and trades. Anyhow for some reason your post has made me want to look into what others have said in regards to spread betting and scalping it. Any more advice help and comments are appreciated.

 

[pboyles]

Do you have any links to a broker I could possibly use that charges small commissions? Will they provide a charting package? I just need a simple charting system. What is the smallest amount of capital I can begin with? Does it work similar to spread betting in the sense that you place a trade like £5 per point?

Vchohan,

If you were to trade the e mini Dow and you were to trade 1 contract you would be trading at $5 per tick, for the e mini S&P the contract is $12.50 per tick, so essentially you would be trading in multiples of $5 or £12.50 per tick depending on what instrument you traded. Trading 2 contracts on the Dow would be $10 per tick and so on. I believe the FTSE is £5 per tick. If you were to think of it as spreadbetting without a spread and with real market data you wouldnt be too far off the mark.

There is no spread and for each contract you trade (buy and sell) you will pay a commission, probably in the region of $3ish depending on how much you trade. So for instance you can scalp for a tick and still make money, for example I entered a order to go long at 1056.75 this morning, the market traded down to 1056.50 and filled me, I then set a take profit at 1057, the market moved up to 1057.25 and filled me. Profit is $12.50 per contract minus just under $3 commission.

Don't get me wrong I'm not saying you should scalp for 1 tick that's just an example of what can be done when you're not paying a spread.

Try Global Futures, Amp Futures or Velocity Futures for starters.

By the way the FTSE isnt the best market to trade, the e mini S&P, the DJ Eurostoxx and the German Bund all have much better liquidity. For example to date today the FTSE has traded 28,000 contracts, the Bund 277,000, the Eurostoxx 516,000 and the S&P 175,000. As they are all highly correlated you may wish to look at the Eurostoxx for trading during the UK session as it has lower margins, commissions and moves a bit smoother than the FTSE.

 

[pboyles]

Here's what I mean about correlation, one chart is FTSE the other is Eurostoxx. Hard to tell the difference, so in my opinion its better to trade the Eurostoxx due to better liquidity, lower margin and commission etc etc.

 

[vchohan]

Okay some more questions if you don't mind as I'm very interested now. What platform or broker do you use? What do you mean by margin? (Sorry to sound like a rookie, it's because I am). If I joined Global Futures do they provide me with a basic charting package?

 

[vchohan]

Just had a look at Global Futures Website and there's various accounts, commissions etc which one should I be looking at or opening?

 

[pboyles]

Okay some more questions if you don't mind as I'm very interested now. What platform or broker do you use? What do you mean by margin? (Sorry to sound like a rookie, it's because I am). If I joined Global Futures do they provide me with a basic charting package?

I use Global, they will provide you with several options for charting and trading platform, all pretty basic but sufficient, GSTrader is the one in the screenshots.

Margin is the amount of money you need in your account to trade each contract, minimum is around $500 per contract but it would be recommended to maybe have $1000 per contract. For instance having a $5000 account would allow you to, in theory trade 10 contracts which would be $125 a tick on the S&P, way too much risk I'd say. SBing has a similar requirement, you cant trade $100 per point if you only have $150 in your account.

By the way did any of you take any long trades off the 5000 round number this morning, I see 2 possible trades which worked.

 

[pboyles]

Just had a look at Global Futures Website and there's various accounts, commissions etc which one should I be looking at or opening?

Futures account, choose the 'Live Simulated Trading Accounts' and try GSTrader platform as your demo, actually it will be called GSTrainer but same thing. Use the live chat feature if you have trouble working it out.

http://www.globalfutures.com/platforms/demo.asp


Demo trade first, dont use real money until you know what youre doing.

 

[vchohan]

Oh I see I would be only trading one contract anyway at £5 per tic with the £5000 capital. Just to be clear if the Eurostoxx up 1 tic and I had bought 1 contract I would be £5 in profit minus the commission right?

It's also asking me to pick a clearing firm. Which one do I pick?

Rosenthal Collins Group (RCG)
Online Application
Hardcopy Application

Penson GHCO
Online Application
Hardcopy Application

Open E-Cry
Online Application

 

[vchohan]

Alright thanks mate I've applied for the demo account and will receive a reply in 2 days or so.

 

[pboyles]

Oh I see I would be only trading one contract anyway at £5 per tic with the £5000 capital. Just to be clear if the Eurostoxx up 1 tic and I had bought 1 contract I would be £5 in profit minus the commission right?

It's also asking me to pick a clearing firm. Which one do I pick?

Rosenthal Collins Group (RCG)
Online Application
Hardcopy Application

Penson GHCO
Online Application
Hardcopy Application

Open E-Cry
Online Application

No Eurostoxx is 10 per tick, mini Dow was 5, they are all different, but yes your example is otherwise correct, if you enter the market at 2500 and it goes to 2501 you have 10 profit minus commission.

Contact them by live chat for your other question, I think they recommend RCG for that platform.

 

[vchohan]

Thanks for the help. How many contracts had the e-mini s&p traded? Are there any markets I can trade that are £5 per tic in European Market hours?

I've missed two trades today both profitable. 15points Total. Haven't made a single trade today. Been otherwise distracted.

 

[pboyles]

Alright thanks mate I've applied for the demo account and will receive a reply in 2 days or so.

Youll have it today I'm sure, a lady called Michelle will probably contact you,. she's very helpful.

Attached is a screenshot of possible trades off the 5000 round number over the past 2 days, I count 5 out of 6 winners on a 5 minute chart and 4 out of 4 on the 15 minute chart. Just to be clear I didnt trade any of them, my trades are only on S&P, Eurostoxx and Bund but the principle is the same.

 

[Black Swan]

pb you're offering up a lot of good advice here, just to add my constructive (hopefully) 2cents. Trading the FTSE with, for example, IG at 1 pip spread aint too bad a place to start. He'll have to pay a 2 pip GS if he's on ltd risk but even so..
My opinion (fwiw) is that his edge, however raw, should work on just about any platform/security. He could take 30 trades a day with IG at a quid a pip, he could win 500 quid a day, and they honestly wouldn't give a flying whether or not what he's doing is scalping, he'd be flying way too low under their radar. BTW trading off 5 mins isn't scalping IMO...

 

[pboyles]

pb you're offering up a lot of good advice here, just to add my constructive (hopefully) 2cents. Trading the FTSE with, for example, IG at 1 pip spread aint too bad a place to start. He'll have to pay a 2 pip GS if he's on ltd risk but even so..
My opinion (fwiw) is that his edge, however raw, should work on just about any platform/security. He could take 30 trades a day with IG at a quid a pip, he could win 500 quid a day, and they honestly wouldn't give a flying whether or not what he's doing is scalping, he'd be flying way too low under their radar. BTW trading off 5 mins isn't scalping IMO...

I think the edge will work but the spread will always increase losers and decrease winners, especially if, like me, you have trouble holding onto trades. I would have been out of all those trades with 5 to 10 ticks so for me spread would make a huge difference, not to mention all the other potential pitfalls of SBing. In particular some of my trades might only have a 3 or 4 tick stop, I think that's asking for trouble when SBing.

 

[vchohan]

On GStrader are you able to put trailing stop that follow to the pip?