Posts: 171
Joined: 3/25/2006
Location: UK
User Profile All thou my trading is automated these days with Forex, I still trade the US indexes using spread betting as my broker vehicle.
The reason I do is the obvious TAX reasons but also keep you in tune with the market and finding new ways to trade.
But the biggest find with spread betting which I created a formula up years ago on how much can you place per £ pound per point per trade.
I hope you find this interesting as it will help you keep you in the game if you have a solid trading mythology.
Here is the formula I will use round numbers of ease of working it out.
Account Size £10000
Divided by 3%
= £300
Divided by Stop loss 25PT's
= £12 per Per trade.
In the chart attached you can see we have our stop loss in place (25 PT's from entry) and made a gain of 53 PT's so a profit of £636.00
Account Size/ divided by 3% / divided by stop loss = £ per point.
We use 3% as this is deemed conservative, anything between 3% and 5% is ok but after that it becomes gambling.
Spread Betting know your risk before you take the trade!
And I wish all the best in the Spread Betting world.
Regards
Frank Birch
Attached file : 2022-05-08_11-00-29.png SB.png (80KB - 145 downloads)