spreadbetting providers ensuring they win

[rob2360]

I have been trading with a number of UK spreadbetters for a while and have had the outrageous temerity to win. Of course no criminal will tolerate that for too long before cooking the books in their favour. I thought I detail the common ones. The more you succeed the more frequent these apply - I get these so frequently now I am about to leave the FX world.

Tactic 1.
Freeze the feed.
This works two ways depending on profit outcome;
If you phone up and trade out manually whilst in profit they will later that day cancel all the relevant trades as "manifest error" as the feed was broken; they won't tell you though, they will just disappear from the daily statement - as if by magic.
If it is in loss then of course no such luck...

Tactic 2.
Slippage.
Enter a minimum lot you'll get a tight price. Enter a large lot and cr*p fill or re-quote comes your way.
I have an example with one provider where the price feed was actually stuck but the price still somehow slipped 13 pips their way on the large fill! As it happened I still closed out with profit manually by phone so guess what happened next (see 1 above for hint).

Good luck trading - you'll need it!

[garyfritz]

Actually lousy fills with large positions are a normal occurrence, if the market is very thin. You'll see that even in "real" markets.

If your bookie is running a small book, he might be able to sell you 0.1 lot at price X because he has somebody who wants to sell there. But if you try to buy 10 lots, he might not have 10 lots of orders anywhere near X. If he was filling purely from his clients' orders, you might end up with terrible fills because you had to go way above X to find 10 lots worth of resting orders.

More likely, I suppose, is that the book is so small that the spreadbetter can't fill from his book. So he has to take the other side himself. That puts him at risk -- especially if you have a history of winning -- so he gives you a lousy fill to reduce his risk.

This is why you shouldn't trade at bucketshops like this...

[rob2360]

Yes it seems that when they go interbank and lay off the trade (or actually execute depending on how you look at it) then spread widens to 30 pips - makes a mockery of the quoted spreads really! And I'm talking at UK early afternoon time trades so hardly "thin".

So the question is -are there any decent providers within spreadbet world? Or perhaps the UK tax free status is a waste of time.

[themaxx]

Rob, you might be interested in Direct Market Access Spread Betting from fpmarkets:
http://www.fpmarkets.co.uk/spread-betti ... -explained

It's an extremely interesting product. You get fills equivalent to the underlying market. They don't trade against you nor do they widen the spread to cover the UK betting duties - you simply pay a 1.8% charge on losing trades which covers the broker's betting duty liability.

PDF giving further details here:
http://www.fpmarkets.co.uk/Content/down ... ide-uk.pdf

[falsedave]

Sounds intresting Maxx. Whats your experience with them ? Can you give us more info. eg Lowest lotsize / leverage / spreads ?

[themaxx]

No experience - I don't actively trade. If my Empty4 account ever gets large enough to start incurring CGT liability I'll move over they seem trustworthy from all their materials.