Trading UK Equities - a mugs' game?

[roughbert]

Is trading UK equities a mugs' game? Because of stamp duty I mean. Should I trade US equities instead? or ETFs?

 

[tomorton]

Its 0.5% on purchase. It might make a significant difference to your overheads if you're scalping but I would suggest scalping UK shares is a bad idea for other reasons apart from the Stamp Duty. Likewise, there are more powerful reasons to go with the US markets.

For swing or position trading or mainstream investing I would have thought this was not significant.

 

[Jack o'Clubs]

Direct access CFDs can get round the stamp duty issues, but tomorton is right that it depends on your style of trading whether you would anyway be better off with the volume/liquidity of the US market.

 

[roughbert]

...It might make a significant difference to your overheads if you're scalping but I would suggest scalping UK shares is a bad idea for other reasons apart from the Stamp Duty.

It does. Would you care to share those other reasons?

 

[tomorton]

I don't do it so can't claim to be an expert, but wide spreads, lack of volume, charges and lack of volatility are what I'm told.

 

[Technically Fundamental]

depends on how much equity you have and how good a trader you are.

 

[roughbert]

depends on how much equity you have and how good a trader you are.

a) Sufficient, and b) I would have every incentive to improve...

 

[MikeYass]

The spreads aren't too bad on most FTSE 100 Stocks, and there are plenty of volatile stocks- check out the banks and miners. The stamp duty will make it harder to make a profit if you don't use CFDs/Spread betting.

 

[level_head]

wide spreads - No, lack of volume - No, charges and lack of volatility -no.. are what I'm told- you've been told wrong, I think.

A top 20 FTSE company's stocl ticks all the right boxes and can be traded very cheaply through CFD, long/short, with none of the above worries.

 

[tomorton]

Hi level_head - Well, you could be right: I don't find FTSE100 spreads very wide at all, and it looks like plenty of action for me. But I don't do scalping. Anyway, the question isn't really is it possible, it is how does this compare with the US? I don't know the answer but how does scalping BP compare with scalping Google?

 

[ukdaytrader]

It is a bit easier to do in the UK as the equities seem to move around more in the day even during quiet times.

In the US there is large movements around opening, announcements and then near closing. On top of that they charge 0.01 cent per share + trade commission.

The UK commission is quite high and takes a lot out of the gross profit so you really have to up the exposure - see my trades below with L&G all done on the same day.


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