Can People Really Get Rich With Financial Spread Betting?

I mean, the online agencies… etrade and capitalspread for example, they look like clones. Does anybody have a personal experience (either positive or negative) with a spreadbetting agency? If so, would you recommend it? Really, I’m clueless Thanks.

2 Comments

  1. PRyder20 wrote
    at 4:32 - 28th Wrzesień 2009 Permalink

    Spreadbetting is one of those things that you can look at the charts and say, „Well, if I’d gone long here, and gone short here, I’d have made a fortune!” I’m very good at this retrospective trading. However, despite having studied technical analysis, and practiced for months on a virtual platform, I have yet to find a winning strategy that can be employed in real time to make a decent amount of money. For example, last year when the credit crunch started to take its hold, with retrospective trading I should have made about ?2,000 in a week. However, I actually made ?15, which was hardly worth my time and effort. ?15 in this situation is one trade off a loss, and is pretty much as good as a loss anyway.
    Although I’m 100% sure there are people out there who make a lot of money doing this (the spread betting companies being the main benificiaries) it’s not something that I feel is a good use of my time or money. If you’re going to think about playing (it’s a game rather than an investment strategy) make sure you’ve had a lot of experience on a virtual platform first, because you can lose a lot of money if you’re not careful.
    The problems are that you MUST have a stop loss. This is good and bad, since it means your bet will normally end up hitting the stop loss, and you go out at a loss. The other problem is that there’s a time limit on it. This will automatically stop you, normally when you’re making a loss. The guaranteed stop losses are also a very good money spinner for the spread betting companies!
    If you were able to keep the bet open indefinitely, then you could adopt the „buy low sell high” strategy more effectively, without being the victim of market volatility. However, since it’s a leveraged product, you can’t justify taking the risk of not pulling out once your stop loss has been hit. So you have to guess the market, which is gambling, not investing.
    I’m not saying there aren’t people who can’t guess the market. If you go in for it, I wish you good luck, but I would not advise it, especially if you’re playing with money you can’t afford to lose, and don’t do it if you’re clueless!
    Put your money in something safer. Like sub prime mortgages.

  2. Anonim wrote
    at 9:29 - 28th Wrzesień 2009 Permalink

    if your clueless stay well clear but people with expertise can do really well!!

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