Spread betting as a full time occupation...

[R11ysf]

S1000RR - everything I've read says it's torn up the motorbike manual and re-written the book.

Is it really that good? I think it is the 2nd best looking bike available after the Dayton 675

[southgate]

R1 Loon said:

Other bits were paying off the mortgages on 6 of the 40 odd propeties abroad too.

40 odd?! Investing in high growth property markets, buy to lets or just like going on holiday? (probably all 3)

Hell of a bike btw.

Edited by southgate on Thursday 21st October 13:32

[Blown2CV]

hello, i am a small fry and here is my story! I fronted up 200 and made 800 in a few weeks... although I currently now stuck in a measly £2/pt short bet i placed against UK100 in sept since when the index has risen about 400pt. So, its all gone! Govt spending cuts surely mean the index will come back down again so I am holding out till then. It almost makes me wonder whether it is a better idea to close out on a huge (for me) loss, rather than lose time that I could be using making profit waiting for it to come good.

[ShadownINja]

Blown2CV said:

hello, i am a small fry and here is my story! I fronted up 200 and made 800 in a few weeks... although I currently now stuck in a measly £2/pt short bet i placed against UK100 in sept since when the index has risen about 400pt. So, its all gone! Govt spending cuts surely mean the index will come back down again so I am holding out till then. It almost makes me wonder whether it is a better idea to close out on a huge (for me) loss, rather than lose time that I could be using making profit waiting for it to come good.

Nothing new there... beginner's luck is the worst kind. I'd hazard a guess you were just counter-trading the big moves - if it goes up a lot you short, if it falls a lot you go long; no stoploss; it can work many times, but the one or two times it doesn't, you'll be raped.

Anyway, you're stuck now. If you close, it could come back. Then again it might continue until your account is dead and your spreadbetting company are asking for more money. If I had accidentally left a trade on without a stop and found I was in a hole, I'd close without thinking twice about it.

Edited by ShadownINja on Thursday 21st October 14:47

[NoelWatson]

Blown2CV said:

Govt spending cuts surely mean the index will come back down again so I am holding out till then.

Might there be a chance that this is laready priced in?

[ShadownINja]

I reckon it will go up... or down. Without a doubt.

Edited by ShadownINja on Thursday 21st October 15:03

[DonkeyApple]

Blown2CV said:

hello, i am a small fry and here is my story! I fronted up 200 and made 800 in a few weeks... although I currently now stuck in a measly £2/pt short bet i placed against UK100 in sept since when the index has risen about 400pt. So, its all gone! Govt spending cuts surely mean the index will come back down again so I am holding out till then. It almost makes me wonder whether it is a better idea to close out on a huge (for me) loss, rather than lose time that I could be using making profit waiting for it to come good.

It's important to always have a reason for a specific trade and when that reason changes or fails then recognise that you should no longer be holding the trade.

Add to this at the outset of each trade calculate what you are willing to lose. Check that this is substantially less that what you realistically expect to gain if you are right. Finally, place a trailing stop within your risk parameters.

As soon as people start writing down prior to each trade the specific reason for that trade they quickly understand that they have no reason and are just gambling and can settle back, relax and piss all their money up the wall, just like the tramp huddled in the corner of Ladbrokes.

[matsmith]

Blown2CV said:

I fronted up 200 and made 800 in a few weeks... although I currently now stuck in a measly £2/pt short bet i placed against UK100 in sept

In addition to what ShadowNinja and Noel have said, assuming you have not increased the funds in your account I would say that your biggest problem is right there on the first line

Your inexperienced and used £1000 to open an £11,000 short, and you describe it as measly! 11x leverage has the potential to wipe you out easily with just one bad trade, and it doesnt have to be that bad a trade to do it

With regards to spending cuts, thats old news already and with the potential of further QE bad news is being taken as good news and good news is being taken as good news.

That said, if its getting to a point where shorters are nearing margin calls we cant be too far away from a top. For what its worth I am getting bearish at this level, but I also remember the wise words I once heard- the markets can stay irrational for longer than you can stay solvent

is there another area of life that has as many wise sayings as the stock market?!

[ShadownINja]

Buddhism.

[Blown2CV]

matsmith said:

Blown2CV said:

I fronted up 200 and made 800 in a few weeks... although I currently now stuck in a measly £2/pt short bet i placed against UK100 in sept

In addition to what ShadowNinja and Noel have said, assuming you have not increased the funds in your account I would say that your biggest problem is right there on the first line

Your inexperienced and used £1000 to open an £11,000 short, and you describe it as measly! 11x leverage has the potential to wipe you out easily with just one bad trade, and it doesnt have to be that bad a trade to do it

With regards to spending cuts, thats old news already and with the potential of further QE bad news is being taken as good news and good news is being taken as good news.

That said, if its getting to a point where shorters are nearing margin calls we cant be too far away from a top. For what its worth I am getting bearish at this level, but I also remember the wise words I once heard- the markets can stay irrational for longer than you can stay solvent

is there another area of life that has as many wise sayings as the stock market?!

Well, I didn't actually say I kept the full £1000 in the account.... but you are right, I did! Beginners luck indeed, this was across many small bets typically riding over the 8am kick-off. I did try and start getting clever with overnight patterns and so on, but patterns only stick for so long. I know a guy that basically did the same as me, except add a zero. I only found this out after I did the same. Still, I am going to stick at it and learn from my mistakes. I am as yet unconvinced that I am useless at it... that is to come!

definitely on the sayings!

[matsmith]

ShadownINja said:

Buddhism.

true, a Buddhist trader would be mind blowing

Blown2CV- Good luck and make sure you really do learn from this. Id suggest you look at your leverage as for a newbie it is rather high

What method do you have for entering and exiting a trade at the moment?

[ShadownINja]

matsmith said:

ShadownINja said:

Buddhism.

true, a Buddhist trader would be mind blowing

If only for the amazing array of sayings you could make up.

The trend is your... route to enlightenment.

Stops are for... non-attachment.

Greed is... finding change within yourself.

Be one with... catching the knife.

Throw in a bit of Yoda-speak and you could start your own religion.

[Blown2CV]

matsmith said:

Id suggest you look at your leverage as for a newbie it is rather high

What method do you have for entering and exiting a trade at the moment?

Umm not sure what the above means I'm afraid. Leverage being potential loss/gain based on margin or something? I don't really know what my method is!

[ShadownINja]

Well, as DonkeyApple suggests above, answer these questions every time you put money on the line:

1) Why am I entering at this price level?
2) Where do I expect the market will get to before I take profit?
3) Where will the reasons for my trade cease to be correct and I should close my trade?
4) How much am I willing to risk losing for this trade?

[matsmith]

indeed Shadow dont think there'd be any time left for the actual process of trading

Ahhh Blown2CV.. well leverage is using a deposit to borrow money to magnify the position size beyond that which would be funded by your initial deposit, so in your case using £1000 to fund an approx £11000 position means 11x leverage

If the security goes in your favour by 9% with 11x leverage then you've (practically) doubled your money, however it only takes a 9% drop to wipe out your account, although your position should be closed once you get to margin call so you should be left with that at least

Excessive leverage is probably what ends the trading careers of 80%+ of spread betters

You really need to have a trading method, ie your criteria for entering or exiting a trade, otherwise your gambling

Might be worth your while asking some of the others on here for some book recommendations if your serious about spread betting

[R1 Loon]

R11ysf said:

S1000RR - everything I've read says it's torn up the motorbike manual and re-written the book.

Is it really that good? I think it is the 2nd best looking bike available after the Dayton 675

Better than they say, truly mindblowing.

Looks are an acquired taste anyway, but I don’t look at it when I’m riding it

southgate said:

40 odd?! Investing in high growth property markets, buy to lets or just like going on holiday? (probably all 3)

Hell of a bike btw.

I bought a load of land donkeys years ago and waited for the town to come to me, whcih it inevitably did, I then build on it when I want to. All properties are let to ex-pats for between 5 & 7 years. There’s more money in holiday lets, or shorter leases, but a load more hassle too and there’s very limited fallow periods this way. Still got scope to whack another 50 villas up, but not quite yet, I need the world to calm down a bit first.

[300bhp/ton]

f13ldy said:

Not for a company, but on your jack at home with your own cash.

Assuming a 6/12 month knowledge of markets and a reasonable initial investment of say circa £2k.

Do you think you could turn a profit of £1500 net a month?

Treating it as a full time occupation for say 6-7 hours a day.

Haven't read the thread. But I worked for a spreadbetting company and the simply answer is no!

A less short answer is no but if you can afford to lose a lot then maybe you can pretend to make viable until it all goes wrong.

[Blown2CV]

surely if there are such things as spreadbetting companies then there is money to be made... and being a privateer just means smaller bets. I know I am being dumb, I just want to know why I am wrong!

[DonkeyApple]

Blown2CV said:

surely if there are such things as spreadbetting companies then there is money to be made... and being a privateer just means smaller bets. I know I am being dumb, I just want to know why I am wrong!

Because on many occasions they are taking the other side of your bet so when you win they lose. They control the price and so can ensure that they don't lose.

The larger the firm the bigger their book of business and the less it matters when clients win as they become a requirement to produce volume to hedge against other client trades. The better you can match your book the less you have to run as exposure and the less you have to pay to hedge externally in the markets.

The smallest firms probably do the least hedging as thier book simply lacks critical mass for winning clients to be of positive value.

I'll give you an idea, there is a broker who is currently promoting spread free trading for some accounts. This means that they are making nothing unless the client loses. You can bet your bottom dollar that anyclient winning more than a couple of hundred quid under such a deal will be switched to manual quoting and if that doesn't reverse their luck then scewed closing prices should do the trick.

In the old days, there was one big firm which would famously just shut down any client account which made money.

I would learn your trade at the firms which allow penny per point trading, concentrate on what you are doing and what you want to achieve from each trade and once you are making money move to one of the largest firms who will often have larger minimum trades.

Before you do any more trading do work out the actual value of each trade, as most people have no idea.

For example one contract on the FTSE is £57,000 (ie 10 x index level).

This means that £2/pp is about £11k of exposure, quite chunky.

Value differs per instrument. Spread betting is missleading due to the pound per point structure.

[300bhp/ton]

Blown2CV said:

surely if there are such things as spreadbetting companies then there is money to be made... and being a privateer just means smaller bets. I know I am being dumb, I just want to know why I am wrong!

The spreadbetting companies are the ones you place the spreadbets with. Sure they'll hedge bet the guys doing well, but nobody wins all the time and the companies make money off the losers, of which most if not all end being.

If you can afford to lose the money, then no worries. Enjoy it or get addicted But it can go from fun to very much in dept very quickly.