Well I have been working on a system that appears to make good profits. I intend to use CMC markets when I go live and I have lost 30k to CMC in the early days when I was a little green. My question is if I start to win, lets say 10k per week based on short fast trades on the FTSE (I am not scalping in anyway, I am using thier price from thier website) will they ban me, more improtantly "CAN" they ban me? I would find it hard to believe they can as they were happy when I was loosing and as I am totally playing by the rules what right do they have to ban me?
P.S. Does anyone actually know anyone who has been banned?
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Scarr, I take it you trade CFDs on the FTSE Index ? I'd rather trade the real product, i.e. FTSE 100 futures on Euronext. You'll need a broker that let's you trade these products, e.g. Interactive Brokers.
An alternative would be LMAX which supposedly doesn't take the other side of your trade so there shouldn't be a conflict of interest. It's an alternative since the contract size is relatively small compared to the futures contracts, so you can test your strategy without losing a truck load.
I have an account with CMC...made some money, lost some money and never experienced any problems apart from slippage and a slow, klunky platform. I don't think they will ban you, should you make money on a regular basis. It's just you are paying way too much on each and every trade due to the spread.
If you're worried about this, I question why you insist on going with them. There is so very little opinion about CMC in the field that I am surprised they maintain a retail operation - it's just very rare that anyone trades with them I find.
Although they are a market maker, your trades should be flowing through to the real market - with the premise of retailers like us trading for profit, banning you based on real market buy and sell prices makes little sense, as their profit is supposed to come from transaction charges.
Having said that, their platform is downright awful and grossly non-standard IMHO (java based) - there are no indicators beyond the few they give you, and thus little support and benchmarking. Their GUI is downright repulsive and far too non-standard and inconvenient, I find. The worst of it is they display no volume statistics (at least that was the case last year) - they did not even have a basic volume indicator and no ability to display it for any instrument. I find this grossly concerning, bordering on criminal, and thus displaying that they do not want their retail traders to have any "edge." Volume can be exceptionally helpful in finding turning points. I spoke to their rep about it when I was looking for a futures broker, and rather easily justified why a serious trader would not choose them with volume data purposefully omitted from their platform - at the end of the day, he was aware who signed his paycheck and I obviously chose a proper broker.
The following user says Thank You to Beljevina for this post:
Thanks everyone for the quick feedback, as I have based everything around CMC I think I have to start with them (at least to get my 30k back + 30k profit) so maybe my question should be who should I use without fear of getting banned or stopped if I won time after time after time and in the 10's of thousands per month? it would have to be FTSE CFD's well for now.
P.S. this is intraday between 30seconds and 90mins usually 5mins
If you're making tens of thousands each and every month you'll have to trade futures.
BTW, I once had a strategy on paper with which I should have doubled my account every other month. That was over 10 years ago. I'm now thankful if I can make maybe 10k per year through trading in addition to my day job. Moral: don't get too excited, it's not that easy. Good luck.
This is not on paper it is using thier demo account I have been testing it on, which I hope I beleive is exactly the same as the live account, monitoring them side by side they appear to be.
Seeker, why do I have to trade futures, if like I said this is proven with daily cash and my system did make 30k (real money) in three weeks on CMC but I got too big for my boots and got into silver without enough knowledge and burned the profit and more but I am now ready to use system again and keep away from stuff I have not reserched!
I have downloaded interactive brokers and "phew" lot in there! my initial question would be are winnings via this taxable?
Also my initial question stands and that is, will / can I get banned and does anyone actually know someone who has been banned or know 100% this will happen on CMC or any other spread betting site.
Last edited by scarr; August 21st, 2011 at 08:02 PM.
I don't think CFD brokers business model is to earn money through their customers losing money. When you take a trade most likely there will be someone taking the other side of the trade or the broker would simply take the same trade as you in the underlying instrument.
Their main income stream should be coming from the spread and transactions fee. Look at their spreads, it is way larger than the futures. They can simply replicate their combined customers trades in the futures market and still make money regardless whether the customer earn or lose in their trades.
The only reason why someone would trade indices using CFD is because they want to trade a smaller position than what the futures allow.
This sounds like train wreck waiting to happen, I'd suggest you stop before you find yourself living in a cardboard box...
Scalping CFDs is lunacy, why would you subject yourself to that spread? Trading the futures is the only solution for that kind of trade frequency... Most people trade CFDs because they're undercapitalized, but it seems you might not have that problem. If so, why subject yourself to the extra expense per trade?
As for having to make your money back from CMC before switching to another, you do understand you are trading the same underlying? You talk about "winning" etc... Treat trading like gambling in a casino, and you can easily make $30K in a few weeks, but don't worry, you'll lose it all soon enough...
I only say this because I don't want that to happen, don't take offense to post...
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