Where to trade? IB or IG! Help!

[lucylou1]

Hi

I am looking to trade a portfolio of 8-12 stocks, commodities, bonds and currencies in a long term trading system.

Each position will be 1-2% of total capital with a maximum risk of 20% to the total capital.

My total capital is £6,000

Now, I was planning on using Interactive brokers because of the low spreads but on closer inspection i see that i can only trade stocks there without having to lay down some serious overnight margin. For example Dow jones mini = $6500 per contract, AUD = $2835, bund = EUR 2552.

For some reason i always thought IB catered to the smaller trader. but if i only have 6k i can no way trade any of these futures. i dont understand because on ig index you can buy the dow jones and only put up £80.

So now I am not sure what to use. the spreadbettors are tax free but the commissions seem to be prohibitive? also ig index for example only has a few commodities. there doesnt seem to be any soybean, wheat, corn etc.

Can anyone advise what they think would be the best option for this type of account??? please!

Many thanks in advance!

 

[Chartsy]

ig has absolutely LOADS of markets...wheat and corn included.

i say go with IG

 

[ns1000]

If it's long term, trade the stocks with IB and if you really want to trade futures with low margins, IG. Don't know how much experience you have, but with a limited pot I would be very cautious about trading indices. Even though they have low margins, you can still lose your entire bank in on big move. I've seen it pretty often where someone builds up a decent pot on products they're familiar with, only to blow it in a week on the index casino.

Of course, if you're comfortable with the increased risk, the rewards are commensurate,

 

[Chartsy]

you can trade futures by CFDs by the way, i'd say that's better than SB,you can trade the ES/YM and any other index with the real underlying spreads and all, with smaller size... and CFDs are liquid.

 

[lucylou1]

Thanks all.

ns1000 - The system will be fairly long term. average trade will be about 60 days so im worried that ig will erode the profits with their commissions?
the only real reason i want to trade other products is to get some diversification.

chartsy- yes thats a excellent point. trouble is i dont know much about cfd's but ill definitely give them a look are they the same as etf's and etc's?

 

[Als]

I am just gonna try WHselfinvest(Benelux) 2500 to open
wud be happy to get your opinion....

keep in reserve investorseurope(Gibraltar) 1000 to open but spreads are not perfect.....

wait for your feedback

regards.....from Benelux

 

[Massi]

i think IB is better. if you make for example scalping or newstrading on IGmarkets, they manipulate this or you receive an email that you have to stop newstrading for example.

 

[Hoggums]

Thanks all.

ns1000 - The system will be fairly long term. average trade will be about 60 days so im worried that ig will erode the profits with their commissions?
the only real reason i want to trade other products is to get some diversification.

chartsy- yes thats a excellent point. trouble is i dont know much about cfd's but ill definitely give them a look are they the same as etf's and etc's?

If you use IG provided you trade the futures and not the rolling daily the charges should not be prohibitive. Make sure you understand how futures work though because there is a time decay element to them based on the riskless interest rate.

 

[Gabrial]

I traded with IG and IB. Now only with Interactive Brokers as their support is better and i can use Investox.

 

[gecko2140]

could you tell me a few companies that deal in fx and cfds that are situated in the benelux

 

[bootsyjam]

With IB you are actually buying a futures contract e.g. eurusd is $12.50 per pip.
With IG, you are not actually buying the contract itself, you are buying IG's interpretation/mirror/synthetic copy of the contract . IG and other spreadbetters provide a mirror of the real markets but they're not the real markets. They're damn close though. At times of high stress, that is why you see prices go outof whack if you have a variety of spreadbetting accts-they're all programmed to follow the market, but not exactly. They will also reflect what is best for the actual spreadbetting company.
Why? The order might not actually go to the real likve market (in fact it probably won't as how do you buy 1/3rd of a contract). IG might take on the risk itself and take all the money if you lose. And if you and 400 other traders have the same idea then I wonder what will happen....If you're long, maybe it'll seem that the price isn't rising as quick as you'd like...

Look up why spreadbetting is tax free (ish)-you are betting on a mirror of the market, IG's mirror. You are not going into the market itself, hence spreadbetting is technically not the same as trading directly into the concerned markets. You're right, IB is not for small traders.

 

[rsh01]

With IB you are actually buying a futures contract e.g. eurusd is $12.50 per pip.
With IG, you are not actually buying the contract itself, you are buying IG's interpretation/mirror/synthetic copy of the contract . IG and other spreadbetters provide a mirror of the real markets but they're not the real markets. They're damn close though. At times of high stress, that is why you see prices go outof whack if you have a variety of spreadbetting accts-they're all programmed to follow the market, but not exactly. They will also reflect what is best for the actual spreadbetting company.
Why? The order might not actually go to the real likve market (in fact it probably won't as how do you buy 1/3rd of a contract). IG might take on the risk itself and take all the money if you lose. And if you and 400 other traders have the same idea then I wonder what will happen....If you're long, maybe it'll seem that the price isn't rising as quick as you'd like...

Look up why spreadbetting is tax free (ish)-you are betting on a mirror of the market, IG's mirror. You are not going into the market itself, hence spreadbetting is technically not the same as trading directly into the concerned markets. You're right, IB is not for small traders.

IG will hedge your bet/trade over a certain amount on total client positions - eg if the total clients are £11mill long ftse they will hedge. If you bet £1mill per point and are net looser, they prob won't hedge.