Hi..does anyone have any advice on the pros/cons of spread trading? Have had a quick look at it...just wanted to know what the limitations are on extracting any gains from your account?..can you withdraw as often as you like or are you required to keep a certain float?...Is it a case that you just lodge an amount each time you want to trade?...would people recommend this type of trading over and above buying actual shares?
Thanks
Mr Mac
pros - you can open a deposit account for relatively small amounts (€1000 or even less) and so long as you meet the margin requirements, a bet(s) can keep running until the contract(s) expires.
- winnings/profits are tax free
- no account fees in general, usually the only charge is the spread itself
- stop losses can be placed to prevent catastrophic losses if market goes against you
- internet aswell as phone trading
cons - the obvious, really, if market goes against you regularly, you'll lose your investment!
- some of the firms offer pretty bad spreads so you should be careful when choosing who to use.
Overall I'd say it's an excellent way of playing the market though, given the fees and commission prices involved
in trading actual stock (particularly with irish brokers)