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UK Based Traders?

  • #1
  • First Post: Jun 12, 2006 4:58am Jun 12, 2006 4:58am
Hi All !

I'm fairly new to FX trading and currently back testing my strategies etc. I was just wondering if there are any UK based traders on this forum who have traded forex using the various spread betting companies available? e.g. IGIndex, TradeIndex etc..

I have my account set up with a UK forex broker but can't help thinking I might as well use a spread betting company as then I don't have to pay tax? (Assuming I make some profits...)
Any discussion on the pros and cons of using spread betting companies for forex?

Any replies gratefully received !

Many thanks,

CT
  • #2
  • Jun 12, 2006 7:24am Jun 12, 2006 7:24am
I do some trades through Capital Spreads although I don't think the spread betting firms are suited to scalping type trades due to the slow manual execution of the orders and requotes. They seem ok though for longer timeframe trading. The other thing to bear in mind is that you will need to make over £8800 before you pay Capital Gains Tax anyway.
  • #3
  • Jun 12, 2006 7:49am Jun 12, 2006 7:49am
Quoting CautiousTrader
Hi All !

I'm fairly new to FX trading and currently back testing my strategies etc. I was just wondering if there are any UK based traders on this forum who have traded forex using the various spread betting companies available? e.g. IGIndex, TradeIndex etc..

I have my account set up with a UK forex broker but can't help thinking I might as well use a spread betting company as then I don't have to pay tax? (Assuming I make some profits...)
Any discussion on the pros and cons of using spread betting companies for forex?

Any replies gratefully received !

Many thanks,

CT
Hi Cautious
I use Ample at the moment http://www.iii.co.uk/spreadbetting/
They have a crappy Java interface that takes a while to get running but the price feed is close to my MT prices so get a good idea of true position.
You can start with a small live account trading for 1penny for the first 8 weeks so you're actually using money which makes it feel a bit like the real thing (I can hear the chuckles in the background).
At the end of the trial period you can move on or move to a minimum stake of 50 pence per trade.
As it's classed as betting there is no tax (Gordon Brown may change this of course). Just make sure you always bet with a stop-loss set as it can be a slowish process to get out of a trade. By that I mean you have to re-buy the currency you've shorted and vice-versa on longs.
It's not as flexible as many of the other platforms around and when I'm solvent enough I'll move on to a proper broker (whatever that means).
Good luck and as another newbie Brit if I can give you the very limited benefit of my short experience please ask.
I may be able to steer you away from some of the mistakes I made, just don't ask me whether to buy or sell a pair at any given time. LOL
Pete
  • #4
  • Jun 12, 2006 8:51am Jun 12, 2006 8:51am
Snaffle, thanks very much for the tax info. I knew there was a minimum amount earned before having to pay capital gains tax but did not know the figure. Looks like more tax reading required for me - exciting stuff... The spread betting companies seem to have spreads between 6/8 pips so wouldn't much good for scalping. I haven't done any live trading with them yet but if they are slow, I'll have to be aware of that.

Pete, thanks for your post! I'll check out Ample. I've used them before for other stuff. I've been using a demo account with TradeIndex. I noticed they completely froze for a while during a non-farm payroll news announcement recently. If I'd been on the wrong side of that trade I'm not sure what the outcome would have been. Not sure it would have been easy to wriggle out of that one. They also insist on huge stop losses e.g. 75 pips minimum. I'm going to try IGIndex too and see if they are more suited to my risk profile.

Thanks again guys!

CT
  • #5
  • Jun 12, 2006 10:53am Jun 12, 2006 10:53am
Quoting CautiousTrader
Hi All !

I'm fairly new to FX trading and currently back testing my strategies etc. I was just wondering if there are any UK based traders on this forum who have traded forex using the various spread betting companies available? e.g. IGIndex, TradeIndex etc..

I have my account set up with a UK forex broker but can't help thinking I might as well use a spread betting company as then I don't have to pay tax? (Assuming I make some profits...)
Any discussion on the pros and cons of using spread betting companies for forex?

Any replies gratefully received !

Many thanks,

CT
There's a couple of rules I'm starting to apply to myself.
For now, while I learn price action and all the other hot stuff in the forums I concentrate on onnly trading EUR/USD. It's too easy to hop around all the pairs and think you spot an opportunity. It will cost you money if you do that. When I first started I'd sometimes have 3 or more trades on the go and you just can't follow them properly. While you're watching one you'll find another has gone from profit to loss.
I'm sure the experienced guys here can play multiples, but I get the feeling that they have tighter money management and are only sitting on trades that have been carefully assessed.
As newbies we are too ready to jump on any candle that LOOKS as if its going somewhere without understanding what's behind the move.
The other thing I do is set my system clock (on the tray) to Eastern Time so I can check the major US announcements without having to calculate the time zone.
For example check out the calendar for tomorrow (Tuesday 13th)
As you can see there are a couple of potentially volatile announcements. I'm not clever enough at the moment to play them with even an average chance of not getting burnt.

So, I'll look at my clock, look at the calendar, maybe look at the charts but I suspect tomorrow will be a quiet day for me until later on.

Pete
  • #6
  • Jun 13, 2006 3:25am Jun 13, 2006 3:25am
Cheers for the advice Pete. I'll be watching how the market reacts to the news announcements tomorrow. I may even try a few news straddles and see how they work out ! Demo of course!


CT
  • #7
  • Jun 13, 2006 4:25pm Jun 13, 2006 4:25pm
Quoting CautiousTrader
Hi All !

I'm fairly new to FX trading and currently back testing my strategies etc. I was just wondering if there are any UK based traders on this forum who have traded forex using the various spread betting companies available? e.g. IGIndex, TradeIndex etc..

I have my account set up with a UK forex broker but can't help thinking I might as well use a spread betting company as then I don't have to pay tax? (Assuming I make some profits...)
Any discussion on the pros and cons of using spread betting companies for forex?

Any replies gratefully received !

Many thanks,

CT
Have a look at CMC it is probably the most simple in the UK Also look at CMS with Visual Trader a US site but has a fabulous demo A/C. I am torn between the two right now
  • #8
  • Jun 14, 2006 11:27am Jun 14, 2006 11:27am
Thanks chapel, I'll check them out!

CT
  • #9
  • Jun 14, 2006 11:54am Jun 14, 2006 11:54am
I use etrade http://www.etradespreadbetting.com/index.htmthe spreads are the best in the market 2 pip for EUR/USD and 3 for GBP/USD. I allways managed to get an execution within 3-5 seconds.

The software is easy to use also stops are about 8 to 10 pips - depends on the pair you're trading. You can get a demo account with them to try out.

The other thing I must say in etrade's favour is that they allways fill you order at the price you entered - if the price wooshes past the order price a lot of brokers will not give you a fill.


I tried CMC on a trial account - but i coulld'nt figure out how you put in stops once you've entered a trade. if anybody knows then please enlighten me. The reason I'm looking at CMC is that they have the best spreads for the DOW and Russell 2K. etrade's Rolling cash prices for the Russell 2K are nonsensical, plus they have a 6 pip spread.
  • #10
  • Jun 14, 2006 12:10pm Jun 14, 2006 12:10pm
the other think I should mention is that I use eSignal for Charts and CMC keeps hanging the charting program.
  • #11
  • Jun 14, 2006 12:55pm Jun 14, 2006 12:55pm
If you are interested where people from FF are located, check this link:

http://www.frappr.com/forexfactory

Add yourself!

Hope this helps -

Dane

PS

I hope I didn't brake any rules posting this link
  • #12
  • Jun 15, 2006 8:15am Jun 15, 2006 8:15am
Thanks Guys.

I'll check out ETrade and the trader location link. What's ESignal? I'll maybe google them.
  • #13
  • Last Post: Jun 21, 2006 1:16pm Jun 21, 2006 1:16pm
From my own (limited) experience i have been using E*Trade for about a year now and they arn't too bad.

i get fills from 2 to 6 seconds and as said before at the price when i hit the button although i have had a couple rejected due to high volatility and a couple of times during NFP the pairs have closed down.

eurusd - 2 pip
gbpusd - 3 pip
usdjpy - 3 pip

Trading times are

07:00 - 21:00.

You can trade most pairs 24 hrs (at a premium spread) but bear in mind if you hold over the weekend, last bet at 21:00 Friday night and next bet at 00:01 Monday morning so you miss a couple of hours.

Oh yes i almost forgot, you can only phone trade 07:00 - 21:00.

Hope that helps

Lyndon
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