ETX Capital - New Website Review


Corporate History

ETX Capital (formerly known as TradIndex) is the trading name of Monecor (London) Ltd which was incorporated in 1973. The firm originally joined interdealer broker Tradition in 2000 as part of their institutional bond brokerage services. In 2002 Monecor became the retail derivatives arm of Tradition UK under the trading name TradIndex. The company quickly established itself as one of the leading UK providers of retail derivatives achieving growth of over 100% year on year.

In 2007 Robin Houldsworth and rag trade and pub entrepreneur Peter Shalson acquired Monecor for an undisclosed sum from Tradition UK Ltd. Later in 2008, the TradIndex site was re-branded as ETX Capital. The name ETX Capital reflects the company's core businesses of electronic trading, telephone trading and execution services.

General Points

  1. ETX Capital (formerly known as TradIndex) offers inexperienced investors a free book entitled 'The Beginner's Guide to Financial Spread Betting' which is written independently of ETX Capital and is a decent enough introduction to spread betting as a whole. In that ETX Capital are very innovative regarding customer connection. One gets a book, Christmas cards, USB sticks.
  2. ETX have stopped offering their simulator account but will accept bets starting from £0.50 to trial their platform. This does away with the problem of experiencing a demo account only to see nothing like the trading experience once you sign up for a 'real' account.
  3.  
  4. Platform is based on dotnet and asp (so no java or flash is required).
  5. All accounts still have the mandatory stop loss facility available however this will not be automatically turned on like the older platform. Stop loss orders can also be moved out of hours.
  6. Credit facilities are not available. This, says ETX Capital, does away with a laborious sign-up process and the need for extensive credit checks.
  7. Good range of markets, if not exhaustive; stocks are quoted to 2 decimal places.
  8. Mobile trading is also available. Maximum stake is £100 per point.
  9. Research and Charting News headlines and charting from FT Marketwatch, plus economic events calendar. A daily e-mail with an overview of the day's financial headlines from the newspapers is also sent to clients at 6 am followed by a Corporate Snapshot at 8am providing a review of the day's earnings reports. Ransquawk and MNI news feed are also helpful.
  10. High net individuals also get access to a personalised research service where ETX collates research reports from different organisations and brokers on a particular stock. Interest on account balances is not usually paid, however this is reviewed a case by case basis, dependant on the amount of funds deposited that are not utilized (over 50k).
  11. ETX Capital have recently re-launched their charting package (provided by I.T Finance and very similar to the IG package) which is available free of charge to all clients. Two charting applications are offered, a Light Plus chart and an Advanced chart.
  12. Novelty markets include being able to bet on the VIX (fear) index. Trading hours are 2.45pm to 9.15pm UK time and the minimum bet is £10 per tic.

Daily Rolling Bets, Futures and Financing Charges

For FTSE 100 shares ETX's spreads are between .08 and .1 percent added to or subtracted from the market bid or offer. For UK shares outside of the FTSE 100 they charge between .18 and .22 percent.

Rolling bets keep rolling until you close them out, you are charged funding for them but the profit/loss will only be realized when you close the trade. You can have as many open positions in the same product as you wish as long as it is in the same direction, but you cannot be long and short the same product. The financing charges are charged on the full amount of a position.

Future bets aren't offered at ETX Capital BUT their rolling dailies differ to some of their competitors in that they will always re-open you the following day at the level that you initially traded at. So in that respect it will be like a future. For example: If you bought £20,000 of Vodafone at 132.2 it equates to approximately £151 per penny movement so your bet would be you bought £151 VOD Rolling Daily @ 132.2 - let's assume it closed at the end of the day at 140 - showing a profit and loss of £1177.8. Your funding would be charged overnight (approximately £1.65 and roughly at that amount every day) and your position would re-open at 132.2 the following day showing a profit of £1177.8.

Basis for Triggering of Stops

Stop losses on the ETX Capital Silver site are executed based on the underlying traded market price with ETX's spread added to this. For example, although ETX's equity contracts are quoted using the underlying market bid and offer prices with their spread added to this, a stop loss would not be executed based on a low bid that has not traded in the market. Below is an example of what would trigger a stop loss.

You are long Apple Inc Rolling Daily with a stop loss to sell at 20259. In the underlying market Apple Inc is trading at 20275 to sell and 20285 to buy. With ETX's spread of 0.08% added to each side, ETX Capital would be quoting 20259 to sell and 20301 to buy. If the underlying stock traded at 20275 and your stop loss was at 20259, then you would be stopped out. If the stock only traded as low as 20285 then your stop loss would not be triggered even though ETX's current sell price is 20259.

Good Points

  1. Easy to use and navigate. A list of your chosen portfolio at the top, with all the relevant links and prices shown, in the middle the row of trading Buy/Sell buttons you have programmed, and at the bottom a list of open positions, with tabs for Closed Positions, Trade History, Order Book and Account Transactions.
  2. Beautifully simple interface, very smooth platform and quite useable. Their revamped platform is slick has a better layout than IG's, locating different markets is probably twice as quick.
  3. Reasonable spreads although maybe not the best. Stop loss orders are not mandatory and you can open an account with as little as £100.
  4. Minimum bet size is just £0.50 (forex majors start at 50p per pt and you can increase the bet size in increments of 10p per point while for some of the minor forex pairs the minimum bet size starts at just 10p per point -> most other providers will start at £1 per point). Minimum 10p bet size on Gold rolling daily and future, again most of the other providers start at a minimum £1.
  5. Quick execution. Claim no dealer intervention on client trades (and I've received feedback from quite a few traders that they never had problems with re-quotes). I use limits to enter and exit and always get the exact price (or better).
  6. An Account allows you to trade over a thousand trading instruments and comes with advanced order functionality - OCOs, If Done, GTC and GFD orders are all available. Execution is also lightning fast with 'One-Click' dealing tickets.
  7. The latest ETX trading platform update has also solved a few minor drawbacks which we used to list as 'bad points' in the past. Previously, one wasn't able to place a 'buy' order above the current price or a 'sell' order below the current price, so momentum trading had to be done manually. This has now been rectified and you can now place buy orders above the market and sell orders below. Secondly, in the past ETX Capital used to impose a 30 point minimum stop on the Dow but this has now been changed and you are now able to leave stops much closer to the market (typically 1.5 times the market spread plus slippage allowance).
  8. You are now able to trade 24 hours on most major markets at ETX Capital (previously trading hours were limited to normal trading hours UK or USA).
  9. Charts: You also get access to the advanced Prorealtime charts (similar to IG), well actually here you even get the bell alerts extra function which IG advanced charts don't seem to have. ETX's advanced charts are at virtually the same identical level to IG Index advanced charts, apart from a dozen or so (volume) based indicators. ETX do not have the (pro)realtime style layout, although the realtime charts from IG are the same as the advanced ones and have the same functions. Note, however, that ETX's charts are based on the mid-quote of their published prices and are thus not necessarily identical to IG Index although you can expect the different providers chart prints to be somewhat similar to each other (within the spread).
  10. ETX Capital offers one of the most agile platforms on the markets. No waiting for download updates and stuff, no waiting for the layout/instruments to load - you simply log on and trade! It works from a browser window without installing any extras. I can trade at work or even at a library though it's not always easy to monitor the prices there.

Bad Points

  1. Range of markets covered is still somehow limited.
  2. Slightly wider spreads.

I have been with ETXCapital since 2002 and although their spreads are not the best I just really like using it. Perhaps ETX Capital can be thought of as a sort of no-frills version, fast and easy-to-use online spread betting platform. Even so a wide range of markets are covered. For instance, stock indices such as the FTSE 100 and the Nikkei are complemented with access to less common exchanges such as the Milan MIB and the Swiss market. ETX Capital also allows swing traders to take positions on commodities such as Brent Crude, High Grade Copper, silver, gold and platinum. Moreover, the site provides access to currencies, bonds (10 year UK gilts and US long bonds) and single shares from the major UK, US and continental European markets.

Please note that here we are only giving an account of our experiences and readers comments/contributions, please do not take this as advice to open/close/avoid any firms - your experience might be different! Send us your comments by filling in the form below.

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