Quote from Rationalize:
Slightly off topic, and related to a product that I don't really know ..
"Leveraged CFDs with guaranteed stops".
Just wondering if these things can be viewed as long ITM options.
Edit: And if so .. there's a vol trade somewhere [?].
Got your (will reply to) PM. IG and others have a CFD with embedded risk-reversal. You losses and gains are capped to 200 or so in FDAX. I haven't looked at it lately. I've only traded CFDs as a hedge on a binary or touch market to keep the haircut within that specific dealer. The edge loss is a few ticks as the R/R would be very cheap on 200-points in a single session. In reality, I doubt they layoff that <200 risk. I don't know if they even offer than anymore.
With IG in FX you can get a guaranteed stop for a 2 pip premium. I don't know if the offer it on shares and indices in the EU. In the US it's only on FX. www.igmarkets.co.uk has a lot more products than the US subsidiary, nadex, who needs to be classified as an exchange rather than a OTC dealer.
