Open & Close advantage in spreadbetting firms

Hi Guys,

Just help me out in this,

There are spreadbetting companies in UK, i checked with one of them and they said they close the position at the end of day and re-open the trade if the trade is open.

I prefer to do long term trading like to hold position more than a day, in that case by closing and opening the trade automatically by spreadbetting company for their accounts adjustments, what are the pros & cons in this.?

I am not sure that sometimes market could open in a wide gap ( i believe even if closing & opening of position doesnt happen, i might have to face this...) is this true?

Thanks
Fxbee

When it comes to trading currencies with spread bets, you will need to look at the individual brokers terms and conditions as they all vary. It's a good idea to speak with one of the dealers if you are unsure about anything.

I know some of the spread bet firms charge half the spread at rollover.
City index are the best one for rollovers, there is no charge for rollover and they pay/charge interest based on the pairs interest differentials. The swaps are good.
Be sure to read all the small print, a lot of them really try to screw you with rollovers.

Hi

Thanks for ur reply peter. I had a account with one of spreadbet firm in UK, but when they said it will be closed and re-opened, i was not sure about their pro's & cons....Anyway as u said , its better to check up with dealer and open a account.

cheers
Fxbee

On daily rolling forex, you will often be charged the spread (or a percentage of it) again if you hold the trade over night. Often 10pm UK time.

I know with the company I use for spreadbetting, the spread is 1 pip for EUR/USD and I get charged around 0.8 pips to roll over. For longer term positions it shouldn't really be an issue, but you need to check with the individal firms on their policies. Some won't re-open positions unless you ask them to.

Its worth being aware that often with spreadbetting firms, prices are only an indication of the market price, which gives them an advantage by the fact they can add or remove small movements and noise to suit their current positions.