Does anyone apart from the broker make money, are SB and CFD scams

[Profitsandloss]

Quote from Visaria:

Yes, I have made money for many years using spreadbet companies.

First of all, they are not brokers, they are market makers. Their prices are based on the underlying market. Their prices are not different from the underlying. If they were you could arbitrage them with the underlying market. I would be rather pleased if they were since i would arb the crap out of them.

Most people lose money with SBs, just the same as most people lose using the underlying markets.

can you explain your arbitrage stratergy.

as for SB, from most people i heard the brokers cancel you out of positions automatically.

 

[Visaria]

Reread my posts.

 

[Profitsandloss]

Quote from Visaria:

Reread my posts.

and than after?

 

[Visaria]

Go to school, perhaps?

 

[blobmorse]

Just like 5th grade. Is pulling hair next.......

 

[Pekelo]

Quote from Visaria:

Yes, I have made money for many years using spreadbet companies.
First of all, they are not brokers, they are market makers.

I know you are talking about SB here. Let's assume CFDs work the same way. Now if a CFD firm has relative few costumers and they are MMs, they still have to step in and take the other side of your trade quite often. If so and if you are profitable that is money out of their pocket, correct?

I always thought CFDs make their money both on the spread and because the majority of their costumers are losers. Can a CFD firm with mostly winning traders be profitable???

Edit: According to this report, the issue is rather complicated:

http://www.leaprate.com/uploads/LeapRate_Online_Trading_Report_2010_Excerpts.pdf

 

[Millionaire]

Quote from Elder000:

Stay away from CFDs because currently only bucket-shops deal with CFDs

Once well established brokers like MB and IB and others uptake CFDs then it will be safe I guess

IB (UK) have started to offer CFDs.

 

[Visaria]

Quote from Pekelo:

Now if a CFD firm has relative few costumers and they are MMs, they still have to step in and take the other side of your trade quite often.

Costumer:

1. One that makes or supplies costumes, as for plays or masquerades.
2. A clothes tree.

 

[Visaria]

Quote from Pekelo:

I know you are talking about SB here. Let's assume CFDs work the same way. Now if a CFD firm has relative few costumers and they are MMs, they still have to step in and take the other side of your trade quite often. If so and if you are profitable that is money out of their pocket, correct?

I always thought CFDs make their money both on the spread and because the majority of their costumers are losers. Can a CFD firm with mostly winning traders be profitable???

Edit: According to this report, the issue is rather complicated:

http://www.leaprate.com/uploads/LeapRate_Online_Trading_Report_2010_Excerpts.pdf

I'm almost certain CFDs are used predominantly by institutional firms, not very much by retail i would think. I know some hedge funds use CFDs here in London. I presume they are trading with investment banks who are market makers who are exempt from the stamp duty of 0.5% i mentioned before. The IB market makers could easily create CFDs for their clients and then simply hedge using their normal trading activities.

The one reason why a retail client might wish to use a CFD rather than SB is if s/he wanted to create a trading record, perhaps for managing money in the future. CFDs have legitimacy in this regard whereas someone showing a great spreadbetting track record may not be taken seriously.