Short-selling shares

rbulph

How can I short sell shares? I have a Selftrade Dealing account, but their online application for a CFD/Spread trading account tells me that I don't have enough experience. For one thing the application asks how many times you have traded at margin. I have never traded at margin because I don't have a CFD/spread trading account, so it's Catch 22. Any advice?

Chrismaths

td waterhouse, city index, ig index etc etc.

You have potentially unlimited losses when you go short, so that's why brokers can be a bit sniffy. In addition, you need to be classified (according to FSA rules and criteria) as an intermediate customer.

equitydealer

You can open a guaranteed stop loss account, that will limit any losses you might make. Every trade that you make will be automatically opened with a guaranteed stop loss position. The drawback is that the spread is larger but I prefer to have myself covered!

For example, if you went short on Marks and Spencer at 700p a share at £2 a point a maximum possible loss will be in place, e.g. £40. If M&S shares go up to 720p your position would be automatically closed, with you incurring a £40 loss. If you open a normal account your losses are not capped and therefore criteria for opening an account can be strict, which is why you were probably turned down.

kitster_2

have a look at https://www.chart-breakouts.co.uk has a feature on s/bets and CFDs.How long u had selftrade acc? not sure why they won't let u cfd trade.

rbulph

I never got round to doing this because of the difficulties of getting authorised for it. It was Alliance & Leicester that I wanted to short. And now their shares have dropped by 50%. I'm going to cry.