ODL Markets Reviewed - Pros/Cons

What they say

'Established in 1994, ODL Markets is a leading, independent Spread Betting, Forex, CFDs, Derivatives, Equity, and Commodity trading house. The company offers private, institutional, and white label clients an integrated approach to trading diverse financial products online via a wide choice of trading platforms. Our focus is on building long term relationships with our valued customers and providing them with excellent information, charting and education. With regulated offices in the UK, USA, Japan, Canada and Monaco, ODL provides clients 24 hour trading and support.'

'In the UK, we are authorised and regulated by the Financial Services Authority (FSA); a member of the London Stock Exchange and NYSE Euronext; and a designated broker and a member of APCIMS. In the USA we are a member of the NFA and registered with the Commodities Futures Trading Commission. In Japan we are regulated to conduct Foreign Exchange, Commodities and Exchange Traded Futures for institutional and retail clients.'

Our hands on experience of ODL Markets backed by reader comments, general experiences and observations :

ODL Markets (www.odlmarkets.co.uk) is a division/trading name of ODL Securities - i.e. it is the same company, regulated by the FSA. ODL Markets makes up the Group's spread betting division whereas ODL Securities offers on exchange products sipps...etc. Note that in May 2010 the ODL Group was acquired by its US-based rival FXCM and ODL is now a subsidiary of FXCM Holdings although it will continue to trade under its original brand.

ODL Securities offers three accounts with differing levels of risk -:

Its 'Discover account' is a limited-risk account where a guaranteed stop-loss is placed free of charge on each trade. The account losses are limited to the funds the customer has deposited with ODL. The maximum bet size with the 'Discover account' is limited to £5 per point which should be fine for most starters.

With the 'Explore Direct account', every trade is automatically opened with a stop-loss, but this will not be guaranteed. This will allow any bet size as long as your account balance covers potential losses i.e. with an automated stop loss 35 points away, on a £5000 account you can bet up to £142 per point (in theory).

The 'Premium account' does not have any of these protections and it is assumed that you are in full control of your risk at this stage.

General Points (we will strive to keep this review up-to-date)

1000's of markets including indices, equities, fx bonds, interest rates and commodities.
Bets can be placed in Euros/Pounds or Dollars.
No minimum amount to open an account but there are minimum margin requirements to open bets (usually a percentage of the value of the bet or a fixed amount) .
Minimum stake sizes are different for each account type (lower for the Discover than Explore than for Frontier...etc). As an example the Wall Street per point min stake is 50p for the Discover, £1 for the Explore, £2 for the Frontier.
Minimum order for internet execution is 1pp (Explore account) and phone: 5pp.
Do not currently quote the FTSE 250 index although they do quote individual equities that make up the FTSE 250 index.
ODLMarkets do not impose a stop when you open a position but do bear in mind that it is their policy to close out positions if you get to zero cash (which is fair enough and similar to CMC and Capital Spreads who put in automatic stops and GFT who liquidate when you hit 25% cash).
Charting software is provided by charting company called IT Finance - several other spread betting providers use the same software.
ODL Markets now runs on the Metatrader 4 trading platform. For those of you who aren't familiar with MetaTrader 4, it is an online dealing system (platform) designed for financial institutions dealing with Forex, CFDs, and Futures markets. MetaTrader 4 used by more than 100 brokerage companies and banks worldwide. This is not as simple as it sounds as the Meta Trader platform was originally designed for forex trading not spread betting but ODL are making a good effort at trying to make it work.
ODL claims that all clients spread bets are executed without re-quotes and that clients positions are hedged in the underlying market on a matching one-to-one basis unlike some of its rivals who may take opposite positions. After clients put in an order, ODL Markets will put in place a corresponding hedge and proceed to execute the trade.
Education - Sandy Jadeja the chief market strategist at ODL Securities runs a regular free education seminar at his company's offices. You can also log onto the ODL website to watch his analysis of key markets in video format. Sandy is a leading figure in technical analysis, especially Fibonacci trading.
And lest I forget recently ODL Markets has started offering spread bets on the Liv-ex 100 Index and a number of individual wines! The ODL contract will allow wine investors to bet on the future direction of wine prices.

Good Points

Platform looks good (clean and simple) and works ok. I especially like the Calendar function.
Financing Charges are at +2% for long positions (some other providers charge 2.5%).
50p per point for most indices/currencies on the Discover account.
Interestingly, ODL Markets allow you to bet both ways at the same time in the same market by using the 'force' open functionality.
ODL do not charge for guaranteed stops on the 'Discover' Account through wider spreads - prices quoted on the 'Discover' account are the same as those on its more advanced 'Explore' and 'Frontier'' accounts. Instead, it sets the guaranteed stops close to the market price - 5 per cent away for equity bets and 0.6 per cent away for index trades.
Main plus point was the 0 point spread FTSE spread promotion but this was discontinued. Let's face it, the zero spread offer just couldn't last!
Rolling bets are available; these rollover from day to day without crystallising profits/losses which is more transparent (than closing and re-opening every day), they also allow more than one open trade on the same instrument at the same time; for instance buy gold @ 900, then it goes up to 905, so I buy again...and then I sell again @ 910... again not all providers offer this functionality.
Excellent Support - I like the way ODL Markets staff answer questions - they listen and answer questions honestly - 'no canned' responses here.
Free financial newsletters and market reports are available including Daily Forex and Oil Commentaries, Economic Traders Diary, Daily Index Reports, Economic Roundup, Gold & Silver Commentary and Sector Reports.

Bad Points

Limited range of markets. No AIM stocks are offered as a spread bet as their risk managers aren't willing to take on the extra speculative risk (but those can be traded as equity or as a CFD).
No future contracts are offered (apparently only Rolling Dailies are available). An issue is that ODL Markets do not offer futures on equities at all which can be a disadvantage if you want to put on a long position and try to hold it over a number of months - overnight financing can mount up.
ODL Markets aren't exactly cheap. Dow spread 4 points. Everyone does it at this price. Margin requirements...well Capital Spreads are cheaper. Furthermore a lot of their FX spreads are not tight, IG offer better spreads.
I don't wish to knock ODL noting the hard work they are putting into improving the platform but unfortunately it seems the system is still unreliable (log outs, price freezes).
Some people have stated that the fills are slow on the ODL platform. If you enter a trade and the fill is so slow that the price has moved you get a message stating 'If you do not get a confirmation within 10 seconds contact customer service'. If you are lucky you might have been filled at the price you clicked at, otherwise no fill. Also, you cannot enter any new trade (even on any other instrument) while that message is there.
Platform updates slowly (the P&L showing is often 20 seconds behind your actual P&L also it can take up to 30 seconds for your position to appear).

Evidently ODL Markets is a new company finding their feet, but seem very interested in feedback from potential users. I am sure ODL needs to improve the platform in some areas. The platform is still new and there are likely to be some initial problems. However, I am quite sure they are aware what it takes to compete in this highly competitive market and are ongoing working to make the platform run more smoothly. However, one has to be careful not to sign up too early with a new vendor. They used to offer a 0 point spread on the FTSE but this was dropped. Now that it's not there might as well use GFT UK or Capital Spreads.

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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!