A: Spread betting is not inherently any more or less risky than buying shares. If you use the implied leverage, yes it gives you exposure to amplified losses/wins, but if you merely put the rest of the cash which would have otherwise been spent fully acquiring the stock in the bank, there is little difference.
Its reputation for being for "chancers" comes from a variety of sources:
1. It's called spread betting.
2. It also takes commission away from the traditional stock brokerages and so they are quick to point out how many people are losers. But do you see any winners in buy and hold since Dec 1999? Not many.
3. The first spread betters understood the lack of stamp duty meant active traders would find spread betting attractive as an alternative to direct share trading. They therefore set up bets for the day, which further encouraged short term speculation. This attracted all sorts of opportunists looking to make a quick buck, many of whom were destined to fail, simply because, contrary to popular opinion, short term trading is much more a game of skill than long term position holding is.
And a word about gambling in general. I have had two serious injuries in my life. One could have confined me to a wheelchair as a tetraplegic, the other could have seen me contract MRSA. Both were sustained doing everyday things: driving (as a passenger) and making a pot of tea. I have however never suffered a single injury from either my skiing or mountain biking activities despite being a bit of a nutcase. In this respect I should point out that the safe often turns out to be more dangerous largely because you think it to be safe.
In actual fact, not only is getting out of bed in the morning risky, but, as sufferers of bed sores and dvt will tell you, so is staying under the covers.
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A: Yes! Today, a lot of the rage seems to focus on everyone trying to trade every move in the market. But with spread betting because of the higher costs involved in short term trading it's often a better stratagem to focus on trading longer term moves.
When looking on the medium to long term the costs become somewhat irrelevant, also it's often less hard to latch on to longer term moves and trends than catch all the short term ups and downs. And thirdly, you don't have to waste time following the market all the time. The author for example once held a Gold position using spread bets for over a year. Take the FTSE for instance, the index has only moved 0.04% a day on average since inception - this means that you stand a greater chance of a gain if you hold the Footsie for a longer period, in fact the chance of the FTSE gaining points over a month is 60% greater than if you just hold onto it for a day.
So to summarize when spread betting over the longer term rollover costs become somewhat irrelevant because they are few and far between although unfortunately unavoidable. However, never rollover yourself as it’s cheaper if you call them and ask them to roll it over for you as they grant a small discount for this.
A spreadbetters lament follows. 
A lot of the early spread betting companies have cleaned up their acts, and are proportionately better than they were. But are they simply getting more sophisticated?
I would never trust a bookie, full stop.
But you use their systems/software, you play by their rules.
They can be beaten... Quite easily. But most of the gripers are losing short-term traders. I know... I was one. I would blame every single thing on them They even put a little man inside my machine! Fifing up every single trade I put on. Honest Guv! I swear he was there. I could feel him there... Then I beat him.
You want to know how? I shot the flucking little clunt!
Move out to a longer time frame for his holiness’ time sake. You can 'scalp' on an hour chart you know!
A: I have been trading stocks fulltime for quite some time now and lack of patience (esp. holding onto winners) has been my one Achilles heel my entire trading career. I just have an enormous urge to ring the register way too often.
Here are few few points to keep in mind:
A Stream
A-1. Trade your rules and don't ever look at your intraday P/L.
A-2. What helped me was keeping a side by side dairy of what I did and what the system did. After staring at how stupid I was for a couple of months, I got better at trading the system and not my incorrect gut feel.
A-3. Don't trade to make money or, worse, get money back. Trade to execute well and have decent entries and exits. I have always found, for myself and my traders, that when money becomes a focus (gotta make $$ back, gotta beat my weekly record, etc), there is more trading, more losing, more holding of the wrong trades and more quick profit taking. These all end up giving you the opposite result from the one you desired in the first place.
A-4. Anyway if I understand his concepts correctly (half way through the book "The Disciplined Trader".) your/my lack of patience may be a result of fear. In this case fear of giving back profits. For example when a trader is afraid or stressed they are generally in a hurry to eliminate that stress/fear. Time seems to move very slowly even though it's not and you become impatient. As soon as you exit the trade the fear/stress is gone. In contrast when your elated or experiencing something that is gratifying time seems to move more quickly. You wish it could last longer.
Until we learn to recognize and control the fear of giving back profits one possible solution may be trading smaller size. In dollar terms you'll have less profit/capital at risk and therefore may feel less fear of losing or giving back profits so it should be easier to let your profitable positions run, like we all know we should.
B stream
B-1. Try reading a book while you are trading, or work out. Keep on audio alerts, to alert you when your price gets to your set target, that way you don't have to watch it constantly.
B-2. Study some books about limit holdem poker and play online on one table for a few months with the recommended starting hands from one of the books! That will definitely teach you to be patient.
B-3. I predominantly spread bet, and usually the euro using tick charts instead of minute charts, although I would think the same thing about this. Whilst trading I have seen that it's very easy to start looking at the last couple of bars and trying to make them significant, whereas across the entire chart they are just noise and without the same relevance. I have come to look at the bars for patterns and entry timing, but try to do so in the context of what I see is more significant price points, and changing my focus to price from bars, and especially the last couple, has made me far more patient and comfortable holding trades.
B-4. To my way of thinking the main function of patience is in waiting for a good trade. Some people are not psychologically equipped to sit out the wiggles. The main thing is be consistent and move on to the next trade with no regrets.
A: I have several strategies, rules, and principles which I try my best to adhere to when trading. You need an edge in the markets - research a market which interests you until you notice patterns, and then devise rules for trading those patterns. Back test and paper trade your system until you are confident that it has a positive expectancy, and then trade it. Remember, you do not need to know what will happen next to make a profit on a trade.
Also, you will never know the outcome of any trade with any certainty. Just remember that if you are trading a system which has an edge over time, trade the system correctly and over a large enough sample size (i.e. enough trades) you should make a profit corresponding to your edge. A casino has an edge in roulette, but it has no way of knowing the result of any given spin. It does know that over a long enough time period and a large enough sample size (i.e. bets) it will make a profit according to the size of its edge.
A: Shorthand for 'Interest rate (LIBOR - London Interbank Offered Rate) on a short-term (3-month) sterling deposit commencing on the 3rd Wednesday in the month for which the price is quoted. For example, the MAR 07 Short Sterling might be quoted as 97.000, implying that the market forecast for LIBOR on the 3rd Wednesday in March 2007 is 100-97=3%. More information on the Short Sterling contract available here
A: The short answer is no. I have seen plenty of graphs mapping implied interest rates against what actually happened and there are big differences. As in any market, for example government bonds, the futures tend to overexaggerate what happens in any direction. They don't really replicate the "jumpiness" of real interest rates, they tend to show a far smoother curve. It is the unpredictability of the magnitude of the rate moves that can catch the futures out, if there is a 50% chance of a half a % move and a 50% chance of a quarter point move, the future will show a 0.375% move as the most likely course.
All we can really say is that low interest rates don't tend to go on for ever, or do high interest rates- their very function is to bring the inflation rate back to around 2.5% and so if you add on a fudge factor based on 4% real inflation gap you should say that in the long term interest rates will probably be around 5-6%. So if interest rates go down to 2% borrow a lot for a long time. If interest rates go up to 15% buy government bonds.
A: Ah...Well... Maybe. There are all sorts of different strategies and tactics that investors employ to best achieve their goal. Some insist that loading a winning holding is always the way to go. That 'the trend is your friend' and should be taken maximum advantage of while it can be. But every new purchase is opened at a loss that has to be overcome (the dealing fee, stamp duty, bid/offer spread), and this setback can dilute or totally demolish whatever gain is already made in the existing holding. So you need to calculate this effect, or you might find that you end up keeping none of your gains if forced to sell just after you've again diluted away your profit. The trend is your friend 'till the bend at the end'. If the trend does expire, each new day will have been one day closer to that happening, and personally I don't like being in possession of my biggest stake when it reverses. I do sometimes double or treble my stake in a stock that is going well, but I do it as early as I can identify that it's a worthwhile idea. And I will bank some of the earlier gain from time to time (think of the process used in The Weakest Link!). This is not an approach that is viable with small accounts where trading costs are proportionately expensive. If I get to a stage where an investment has doubled, I will sometimes sell half, thereby recouping my initial outlay so that the ongoing holding is 'free'.
A: I have received a share certificate from Mobilestream Oil & Gas Company to whom I paid the money. They have responded to me both in writing and via email the contact is Angie Cambridge email info@mobilestreamoil.com.
The following note was written on the rear of the certificate,
The shares represented by this certificate have not been registered under the securities Act of 1933, as amended, or applicable State Securities Laws, and may not be sold, transferred, pledged or hypothecated without either:
Could you tell me what that means? Hope I have not bought a pig in a poke as the current value on Bloomberg is in excess of $4 dollars.
If you were cold called regarding the investment then sorry to tell you that there's a 99% chance that your money has been stolen from you. And there's little you can do about it because you're dealing with scammers of the highest calibre. They will have an answer for every question you might ask them.
Financial advisor won't be able to help you on this one though mate. You will have to wait at least a full 12 months before the selling restriction can be lifted. Normal practice is that after 12 months you will have to pay between $200-$500 to have the restriction lifted, that is providing Mobilestream are up to date with all their fillings with the SEC, then you will be able to sell within a time frame of 3 months, if the stock isn't sold within this time frame the restriction is put back on for another 12 months. Regulation S rule 144 shares only becomes common stock after 24 months. As Mobilestream have not filed anything with the SEC yet, you will probably have to wait the full two years before you can sell the shares. More information on the Cold Colling Offshore Brokers is available here Check the Glossary for More information on Regulation S and Form S-8. Sorry if this is bad new.
A: Is having an open spread bet the same as holding a certificate other than not having ownership of the company? I tend to LTBH, is that suitable for a spread bet?
If the only difference between spread bets and holding shares is physical ownership of the company and assets then the tax advantages and not paying interest on that proportion of the mortgage loan seem to suggest that I would be best off not holding the shares and taking out the spread bets.
Have I got this right or does it not work like that?
Almost certainly not. The interest you pay on the spreadbet is likely to be more than that you pay on the mortgage. You'd have to check the figures carefully but I think it's likely that that's what you'd find if you did the sums.
If you were confident the use of spreadbets would work as follows using random numbers. You sell £50,000 shares and open £1,000pp FWY at 100p. This is an exposure of £100,000 and will cost you £25,000 with IG to open and you can put the other £25,000 into your offset mortgage (although you made need it for margin calls if FWY falls).
If FWY makes 30% over the next year you would have made £15,000 with your original shares. Through the spreadbet you make £30,000-£8,000(IG costs/finance) + £1,500 (offset mortgage interest at 6%) or £23,500 tax-free (i.e. 57% more, but on double the exposure). If you make the gain in a shorter time period the benefit rises due to lower IG finance costs.
However, if FWY loses 30% over the year you would have lost £15,000 with your original shares, but the spreadbet will probably lose you around £36,500.
Therefore, downside is worse than the upside because either way you have to pay the IG finance charge, so you need to be very confident in the upside for it to be worthwhile.
If you had done a spreadbet with the same exposure (i.e. £50,000), the spreadbet gain or loss (for +/- 30%) would be a profit of c.£13,250 or a loss of c.£16,750.
The above is an illustration of why most people lose on spreadbets, namely you need c.8% p.a. gain just to break even. The interest on the spread bet may not be obvious but if you study the detailed terms, you'll find it. Can be as much as LIBOR+3% (i.e. >7% pa). Once you study those details, they'll answer your other questions...
One other thing to bear in mind, though, which does argue for SBs: if you think you may have a CGT liability (i.e. expect to make trading profits > £8K-ish in any one year) then spread betting can be quite attractive, esp. if you are a higher rate tax payer.
Unfortunately 'there's no such thing as a free lunch'. Margin trading is not a way of getting free money!
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