CFD vs Direct Market - Emini Index Futures Trading | futures io social day trading
futures io futures trading


CFD vs Direct Market
Updated: Views / Replies:3,416 / 30
Created: by bbgg91 Attachments:0

Welcome to futures io.

(If you already have an account, login at the top of the page)

futures io is the largest futures trading community on the planet, with over 90,000 members. At futures io, our goal has always been and always will be to create a friendly, positive, forward-thinking community where members can openly share and discuss everything the world of trading has to offer. The community is one of the friendliest you will find on any subject, with members going out of their way to help others. Some of the primary differences between futures io and other trading sites revolve around the standards of our community. Those standards include a code of conduct for our members, as well as extremely high standards that govern which partners we do business with, and which products or services we recommend to our members.

At futures io, our focus is on quality education. No hype, gimmicks, or secret sauce. The truth is: trading is hard. To succeed, you need to surround yourself with the right support system, educational content, and trading mentors Ė all of which you can find on futures io, utilizing our social trading environment.

With futures io, you can find honest trading reviews on brokers, trading rooms, indicator packages, trading strategies, and much more. Our trading review process is highly moderated to ensure that only genuine users are allowed, so you donít need to worry about fake reviews.

We are fundamentally different than most other trading sites:
  • We are here to help. Just let us know what you need.
  • We work extremely hard to keep things positive in our community.
  • We do not tolerate rude behavior, trolling, or vendors advertising in posts.
  • We firmly believe in and encourage sharing. The holy grail is within you, we can help you find it.
  • We expect our members to participate and become a part of the community. Help yourself by helping others.

You'll need to register in order to view the content of the threads and start contributing to our community.  It's free and simple.

-- Big Mike, Site Administrator

Reply
 
Thread Tools Search this Thread
 

CFD vs Direct Market

  #21 (permalink)
Just a boy
Auckland, New Zealand
 
Futures Experience: Beginner
Platform: Sierra Chart
Broker/Data: AMP/CQG
Favorite Futures: Whatever moves in my timezone
 
Posts: 1,803 since Sep 2009
Thanks: 3,165 given, 1,372 received

@bbgg91


Quoting 
Like I said, CMC create a guaranteed market so if you play within that market depth it is not important. If you want a larger size, do multiple orders within their limit. If you are worried about getting scalped on fills change your order type. No different to the real market. Doing at market orders on any exchange will create problems at times. I have done both. If you play within the parameters they set there is not much difference.

So are you saying if you put a Buy Stop Limit above the market CMC guarantee to fill you at your limit price if 'their' market price trades through your limit? Because that is better than futures, where price can trade through your Stop Limit and never come back and fill it.

Presumably CMCs guarantee to fill you at your Limit is only if price trades through your Limit price, if it just touches the limit price I assume there is no guarantee of the fill.

And what do you mean by 'play within their market depth'? At various price levels are they showing what volume they are prepared to accept trades for ie a bit like the order book levels on futures?


Quoting 
If they move things around as to control what they do to their advantage at the cost of their customers I am sure they will not be in business for very long. There are plenty of CFD providers around to stop each other doing that.

But this is exactly what they do, although you have way more experience trading CFDs than I do. It is a zero sum game, so if all CMCs customer are winning then CMC is losing, unless of course all the orders are DMA. I recall years ago when I looked at this there was a trader on Aussie Stock Forums who would get his account shut down by CFD providers because he was winning too consistently. Sure there are a number of CFD providers in OZ you can move to, but it is not limitless. Maybe the industry has improved over the years, especially when it comes to CFDs that are traded via DMA, which was not the norm when I looked at it 8 or 9 years ago.

Reply With Quote
 
  #22 (permalink)
Trading Apprentice
melbourne, australia
 
Futures Experience: Intermediate
Platform: cmc
Favorite Futures: indices
 
Posts: 24 since Mar 2016
Thanks: 2 given, 32 received


Neo1 View Post
So are you saying if you put a Buy Stop Limit above the market CMC guarantee to fill you at your limit price if 'their' market price trades through your limit? Because that is better than futures, where price can trade through your Stop Limit and never come back and fill it.

No. Though I have never tried it, I am sure you cannot do it. I will try and set one tomorrow. Once I see a setup I try and get a better price so will often wait for that small pull back to enter.



Neo1 View Post
Presumably CMCs guarantee to fill you at your Limit is only if price trades through your Limit price, if it just touches the limit price I assume there is no guarantee of the fill.

Depends on your position size. If you are within their market limit then yes it will be filled.



Neo1 View Post
And what do you mean by 'play within their market depth'? At various price levels are they showing what volume they are prepared to accept trades for ie a bit like the order book levels on futures?

Yes they have a depth level down to I think 10. I do not really look at it as it is of no use to me. If you want to take a position larger than what they make then your spread can and will vary. That is why if I want to open a larger position I just do multiple orders. I just set limits on all the orders at the same price and they are filled.



Neo1 View Post
But this is exactly what they do, although you have way more experience trading CFDs than I do. It is a zero sum game, so if all CMCs customer are winning then CMC is losing, unless of course all the orders are DMA. I recall years ago when I looked at this there was a trader on Aussie Stock Forums who would get his account shut down by CFD providers because he was winning too consistently. Sure there are a number of CFD providers in OZ you can move to, but it is not limitless. Maybe the industry has improved over the years, especially when it comes to CFDs that are traded via DMA, which was not the norm when I looked at it 8 or 9 years ago.

CFD providers here have upped their game. Some years back they would requote you on the smallest of orders which was just stupid and for trading purposes not workable. Their new platforms are all automated so you do not have to worry about that any more. CMC hedge more than 90% of their positions (maybe more now) so for them it is not a zero sum game. They make money from the spread (and interest/holding charges). I win quite often and have never been shut down. The old days of them trying to bleed clients are long gone. Like I said too much competition. I will add a caveat about trading out of market hours. You have to be careful though the SPI does track other indices after the asx closes. I then switch to trading the DAX or FTSE.

Reply With Quote
The following 2 users say Thank You to bbgg91 for this post:
 
  #23 (permalink)
Elite member
Hertfordshire England
 
Futures Experience: Intermediate
Platform: NT
Favorite Futures: DAX
 
pvlee's Avatar
 
Posts: 92 since May 2011
Thanks: 96 given, 164 received


I would concur with the previous poster. Most of my fills are pretty good on FXCM's Germany30 CFD. When the market is volatile I have had 4 or 5 ticks of slippage on stops and profit targets. All in all, the trading environment is pretty good. I think they have upped their game over the last few years.

Plus, no tax here in the UK for spread betting

Reply With Quote
The following 2 users say Thank You to pvlee for this post:
 
  #24 (permalink)
Elite Member
Christchurch, New Zealand
 
Futures Experience: Beginner
Platform: SC
Broker/Data: IB, BC, Dx Feed
Favorite Futures: US Equities
 
Neo1's Avatar
 
Posts: 422 since Jul 2014
Thanks: 470 given, 470 received


steve2222 View Post
Thanks for that. Lucky I am not an Aussie

Actually a long time ago I did have an Aussie CFD account with IG when I lived there, but never really got into trading CFDs and closed the account.

I remember seeing somewhere else about IB not accepting Aussie CFD customers. Why is this given Australia is a well known CFD country with numerous CFD providers? Is it something to do with IB not wanting to comply with some Aussie regulatory requirement? Don't IB still operate there for other forms of trading?


Itís not just CFDs, itís margin lending. Aussie retail clients canít hold any type of margin account with IB. IB got into a disagreement with ASIC because apparently they didnít have the right licensing, even though they were allowed to operate for 2-3 years before ASIC made them aware.

I assume the costs/ compliance required in order for IB to acquire the license makes it not worthwhile for them, or they think ASIC are a bunch of twats. Most likely itís bothÖTD also shut down all their margin lending to Aussie clients as well, I donít think they even offer accounts to Aussie clients anymore.

The compliance issue is something to do with Margin calls, where under IBs T&Cs they have the right to liquidate an account without warning, which doesnít comply with ASIC regulation circa 2010.

From my understanding US firms have far more robust risk models vs Aussie firms- especially when it comes to options. ASIC regulation means US firms would be taking on more risk in order to comply.

"Free markets work because they allow people to be lucky, thanks to aggressive trial and error, not by giving rewards or incentives for skill. The strategy is, then, to tinker as much as possible and try to collect as many Black Swan opportunities as you can"
Reply With Quote
The following user says Thank You to Neo1 for this post:
 
  #25 (permalink)
Elite Member
Christchurch, New Zealand
 
Futures Experience: Beginner
Platform: SC
Broker/Data: IB, BC, Dx Feed
Favorite Futures: US Equities
 
Neo1's Avatar
 
Posts: 422 since Jul 2014
Thanks: 470 given, 470 received


bbgg91 View Post
No. Though I have never tried it, I am sure you cannot do it. I will try and set one tomorrow. Once I see a setup I try and get a better price so will often wait for that small pull back to enter.




Depends on your position size. If you are within their market limit then yes it will be filled.




Yes they have a depth level down to I think 10. I do not really look at it as it is of no use to me. If you want to take a position larger than what they make then your spread can and will vary. That is why if I want to open a larger position I just do multiple orders. I just set limits on all the orders at the same price and they are filled.




CFD providers here have upped their game. Some years back they would requote you on the smallest of orders which was just stupid and for trading purposes not workable. Their new platforms are all automated so you do not have to worry about that any more. CMC hedge more than 90% of their positions (maybe more now) so for them it is not a zero sum game. They make money from the spread (and interest/holding charges). I win quite often and have never been shut down. The old days of them trying to bleed clients are long gone. Like I said too much competition. I will add a caveat about trading out of market hours. You have to be careful though the SPI does track other indices after the asx closes. I then switch to trading the DAX or FTSE.


You've somehow mixed up your quotes in the previous post!

How much does it cost you per round trip when you trade ASX200? Does 1 point = $25 ?

"Free markets work because they allow people to be lucky, thanks to aggressive trial and error, not by giving rewards or incentives for skill. The strategy is, then, to tinker as much as possible and try to collect as many Black Swan opportunities as you can"
Reply With Quote
 
  #26 (permalink)
Trading Apprentice
melbourne, australia
 
Futures Experience: Intermediate
Platform: cmc
Favorite Futures: indices
 
Posts: 24 since Mar 2016
Thanks: 2 given, 32 received


Neo1 View Post
You've somehow mixed up your quotes in the previous post!

sorry about that


Neo1 View Post
How much does it cost you per round trip when you trade ASX200? Does 1 point = $25 ?

It is whatever dollars per point you want to do so for example you want to do $100 per point then the cost is $100 as the spread at that level is 1 point. No other costs involved unless you hold over night.


Last edited by bbgg91; March 20th, 2016 at 11:26 PM.
Reply With Quote
 
  #27 (permalink)
Elite Member
Leeds UK
 
Futures Experience: Intermediate
Platform: FXTrade
Broker/Data: Interactive Brokers, CapitalSpreads, Oanda
Favorite Futures: GBP/USD
 
Tymbeline's Avatar
 
Posts: 401 since Apr 2015
Thanks: 894 given, 486 received


pvlee View Post
Plus, no tax here in the UK for spread betting


Not for spread-betting, this is true, but profits from trading CFD's are certainly taxable (as capital gains).

Reply With Quote
 
  #28 (permalink)
 Vendor: www.fxcm.com 
New York
 
Futures Experience: Intermediate
Platform: Strategy Trader
 
Jason Rogers's Avatar
 
Posts: 164 since Aug 2010
Thanks: 122 given, 153 received


pvlee View Post
I would concur with the previous poster. Most of my fills are pretty good on FXCM's Germany30 CFD. When the market is volatile I have had 4 or 5 ticks of slippage on stops and profit targets. All in all, the trading environment is pretty good. I think they have upped their game over the last few years.

Plus, no tax here in the UK for spread betting

Hi Pvlee,

I'm glad you're pleased with the execution you get on your spread betting account with FXCM. Since you mentioned slippage during volatile markets, I wanted to make sure you are aware of the Market Range and Range Entry settings that are available on our Trading Station platform for market and entry (stop and limit) orders respectively.

These custom order settings let you specify how much negative slippage you are willing to tolerate. Your order will be filled at the best available price on our platform, but if that price is outside of your specified negative slippage tolerance, then the order will be canceled instead. Note that Market Range and Range Entry only limit your negative slippage, not your positive slippage.

If you have questions about our services at FXCM please send me a Private Message.
Reply With Quote
The following user says Thank You to Jason Rogers for this post:
 
  #29 (permalink)
Elite Member
Christchurch, New Zealand
 
Futures Experience: Beginner
Platform: SC
Broker/Data: IB, BC, Dx Feed
Favorite Futures: US Equities
 
Neo1's Avatar
 
Posts: 422 since Jul 2014
Thanks: 470 given, 470 received


bbgg91 View Post
sorry about that



It is whatever dollars per point you want to do so for example you want to do $100 per point then the cost is $100 as the spread at that level is 1 point. No other costs involved unless you hold over night.

So if you want to trade a real SPI contract where 1 point = $25, then you would be paying $50 in commission per round trip?

"Free markets work because they allow people to be lucky, thanks to aggressive trial and error, not by giving rewards or incentives for skill. The strategy is, then, to tinker as much as possible and try to collect as many Black Swan opportunities as you can"
Reply With Quote
 
  #30 (permalink)
 Vendor: www.traderwerks.com 
Taipei Taiwan
 
Futures Experience: Advanced
Platform: NinjaTrader
Broker/Data: Optimus
Favorite Futures: TW
 
Posts: 693 since Jun 2009
Thanks: 440 given, 440 received

Yes, it is



Neo1 View Post
So if you want to trade a real SPI contract where 1 point = $25, then you would be paying $50 in commission per round trip?

Yes you would pat that. It is the same as using market orders for everything and constantly crossing the spread.

In futures, you can get in an out with limit orders ( As any market with a limit order book ).

Math. A gateway drug to reality.
Reply With Quote

Reply



futures io > > > > CFD vs Direct Market

Thread Tools Search this Thread
Search this Thread:

Advanced Search



Upcoming Webinars and Events (4:30PM ET unless noted)

Jigsaw Trading: TBA

Elite only

FuturesTrader71: TBA

Elite only

NinjaTrader: TBA

Jan 18

RandBots: TBA

Jan 23

GFF Brokers & CME Group: Futures & Bitcoin

Elite only

Adam Grimes: TBA

Elite only

Ran Aroussi: TBA

Elite only
     

Similar Threads
Thread Thread Starter Forum Replies Last Post
CFD steve2222 Terms (Glossary) 0 December 17th, 2015 09:04 AM
Market Data feeds - SIP, Direct Edge, etc vs Nanex/IQFeed Big Mike Reviews of Brokers and Data Feeds 18 August 2nd, 2014 07:42 AM
Please direct me to market delta candle sticks script Realiori9999 NinjaTrader 0 March 26th, 2014 07:12 PM
CFD volume - where will it come from? leo33 Options on Futures 3 May 21st, 2013 08:18 AM
Direct Market Access Big Mike Terms (Glossary) 0 October 18th, 2011 12:38 PM


All times are GMT -4. The time now is 02:37 AM.

Copyright © 2017 by futures io, s.a., Av Ricardo J. Alfaro, Century Tower, Panama, +507 833-9432, info@futures.io
All information is for educational use only and is not investment advice.
There is a substantial risk of loss in trading commodity futures, stocks, options and foreign exchange products. Past performance is not indicative of future results.
no new posts
Page generated 2017-12-14 in 0.15 seconds with 19 queries on phoenix via your IP 54.221.76.68