At one free spread-betting seminar I attended we were more than strongly encouraged to sign up for a two-day weekend course teaching us how to spread 우리카지노 successfully. This would normally cost (we were told) £6,995, but there was a special offer for the first five people to sign up of only £1,997. There are many such courses and also gurus offering to sell you their special spread-betting systems, guides, webinars and all sorts of other advice. With so many supposed experts apparently making a living teaching others how to spread bet, there must be a lot of takers. But I’ve found that all you need to know and more is available free on the Internet. As one specialist said, ‘Don’t bother wasting your money on ‘Guru’ books written by so-called experts. Those books are crap and not worth the paper they are printed on. Nobody sells a secret trading methodology if they are really successful. The only reason these guys are writing books is because they didn’t make it as traders’.
It’s the bobbing about that beats you – We often hear on the news that the price of gold has risen by a few dollars an ounce or the FTSE has fallen by a hundred and thirty points or that the pound has risen by two cents against the dollar. These reports make price changes on financial instruments sound like smooth movements either up or down. However, the prices of shares, stock markets, commodities and currencies seldom move in straight lines. They jump about every few seconds. So, if the FTSE is at 5540 and you correctly bet £50 a pip that it will go up to 5545 you might not necessarily win £200. In between going from 5540 to 5545, it might drop down a couple of times to say 5535 or lower. If you have a stop loss on at 5536 or 5535 to avoid losing too much money, your stop loss will kick in and you’ll lose £250 or £300 even if the index did subsequently move upwards as you predicted. I’ve placed over a hundred bets to test whether I won when my bets were right. On about eighty per cent I lost in spite of being right because the fluctuations triggered the stop losses even though the index did actually move from where it was to where I predicted it would go. This creates a rather odd situation where stop losses can unfortunately make you lose even when you should be winning. Yet if you don’t put stop losses on and things go in the wrong direction, your losses can annihilate you.
It attracts losers – At the spread betting seminars I’ve attended, I’ve been shocked by the number of low-paid workers – waiters, porters, kitchen staff, healthcare assistants and impoverished, would-be writers like myself – who decide to have a go at spread betting as they believe that, apart from winning the Lottery, it may be the only realistic way they have of making any money. These people will be betting with their meagre life savings against extremely sophisticated financial services insiders with vast knowledge, many years experience and extraordinarily deep pockets. It’s not difficult to guess who is going to win.
Sucker or smartie?
Spread betting is a ‘zero sum game’. Unlike depositing our money in a bank so it can be lent to businesses or house-buyers, spread betting doesn’t create wealth. It just redistributes money from the suckers to the smart. When contemplating whether to try your hand at spread betting, you need to work out whether you are likely to be in the ninety per cent who end up as suckers or the ten per cent who make money by being smart. I found it interesting that not a single one of the amiable young men and women from spread-betting companies that I spoke to actually did any spread betting themselves. By the way, when I did eventually open a live spread betting account and managed to win about £100 a day for ten days, the spread betting company started preventing me getting out of losing bets because they claimed I was “betting unfairly”. However, if you do manage to spread bet successfully, please drop me an email, I’d love to find out how to do it.