CFD's

adonis10

I have been using a demo CFD account on cityindex.co.uk for a few months and quite fancy going into a real account. I've been using it to practice and gain a little knowledge. I intend to start low until I find my feet and gain access to more capital.

What sort of initial capital outlay would be advisable?

adonis10

Also, can anyone recommend a CFD provider who charges less than £15 commission? City Index is a minimum of £15 per buy and sell, making it £30/trade. This is obviously no good for a small time CFD trader. This gives rise to the question "Is it really worth trading CFD's if you have less than £1,000 to play with?"

Loughton_Monkey

adonis10 wrote: »

Also, can anyone recommend a CFD provider who charges less than £15 commission? City Index is a minimum of £15 per buy and sell, making it £30/trade. This is obviously no good for a small time CFD trader. This gives rise to the question "Is it really worth trading CFD's if you have less than £1,000 to play with?"

I use Interactive Investor.

Personally, I don't use it much these days. I used to have a £5,000 account and tended to trade a few 'shares' with a timeline of months. My understanding is that they charge £7 a trade these days.

Now, they have a totally new platform. I transferred just £500 to the new one (the rest I took out). I tend only to use it to play the FTSE index. I only use it as a bit of 'fun' and it keeps me more actively involved in what's going on in the markets.

Since September, I've grown this to £901.07. I only put on £1 (or at the most £2) and tend not to build up a position much more than £3 or £4 at most. I notice that for each £1 on the FTSE, they grab around £40 "Margin".

Can't really advise how much to put in. The main driver for this is how much 'trading' you wish to do, and in which markets. Although it's a bit of a spreadsheet job, you could easily work it out.

Simply decide on the number and size of the trades you are likely to do in each of their markets (Indices, Shares, Currency, Sectors etc.) Each of these has their own "Margin Requirements".

By writing down the maximum amounts in each market that you think you will want 'on the go' at any one time, and you can work out what margin (and therefore deposit) you need to throw into your account.

I'm a bit out out touch, but if (like me) you just wanted to play indices like the FTSE, I think the margin is 0.75%.

So with FTSE at 5675 (which it is while I write. I just looked at it!), each £1 exposure requires £42.56 margin. Hence my £900 would allow me to have up to £20 exposed at any time (less a safety margin, because things might blip down and they would stop you out). That's rather more than I want, simply because this is just a plaything with me, rather than any investment.

getzegold

FXCM has a good CFD platform.
you'll prob need a couple of k min (2k is their min open account amount)as its never adviseable to trade more than 5-10% of total equity on any single trade.
Can open a spreadbet account for 500 if you want to trade the main indices and forex

cepheus

At CMC Markets, we are pleased to offer low commission charges from 8 basis points (0.08%) on UK equity CFDs. All our other CFD instruments including indices, commodities and treasuries are commission free – generating a huge saving for traders.

http://www.cmcmarkets.co.uk/cfd/range-of-markets

It's a long time since I have used these guys, there might be a minimum commission better check.

For any spread bet CFD provider check on spread, financing (interest on long short positions) and if they actually quote the market or fiddle the prices etc. They all make a profit somehow! Someone at trade2win should be able to tell you.

getzegold

cepheus wrote: »

http://www.cmcmarkets.co.uk/cfd/range-of-markets

It's a long time since I have used these guys, there might be a minimum commission better check.

For any spread bet CFD provider check on spread, financing (interest on long short positions) and if they actually quote the market or fiddle the prices etc. They all make a profit somehow! Someone at trade2win should be able to tell you.

FXCM don't re-quote the commission is in the spread

cepheus

getzegold wrote: »

FXCM don't re-quote the commission is in the spread

Well CMC claim they don't requote now, but they all have their tricks!

http://www.cmcmarkets.co.uk/about/benefits

benfinance

I would say also have a look at ETX Capital, they have a really good CFD Trading platform
etxcapital.co.uk/CFD-Trading/Our-Platform.aspx

Money-Maker_6

Spreadco have no minimums on their CFD single position accounts, but personally i would only invest what you are prepared to lose and won't effect your currently lifestyle or family.
If you can't afford it don't do it! As CFD and Spread betting are only 1 step removed from the casino!

darkpool

Have you considered buying traded options? All the gearing you can handle but you can't lose more than your initial investment.

I use sucden