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Has anyone here had much experience trading market tracking warrants? I'd be interested to try this out when my warrant/options trading account comes online. I'm new to derivatives and would enjoy chatting to anyone with some hands on experience.

 

Regards

Andrew

 

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Andrew

I have just spent 8 months trading the SPI and it has been tough. The main problem has been the liquidity and the fact that it can be flicked around by large institutions that skew the market in the short term, away from its true value. I know my trading skills are reasonably good, however in the spi I felt I was really battling a greater foe. I am translating that experience and skill into CFD's where I can trade indeces and any of the top 200 shares and I can trade them short and long. This is very flexible and should not be subject to the same manipulation. In my 8 years experience as a stockbroker (and I traded warrants right from the beginning) I have found warrants to be ineffecient and subject to poor movements as new issues come on stream with differing strike prices and expiry dates etc. I hope this helps.

Hector (pete taylor)

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Thanks Hector. Your thoughts are really appreciated. http://www.sharescene.com/html/emoticons/smile.gif I'm going to do a bit more research in to CFDs now. Do you have any tips or pointers?

 

Was there any kind of derivatives trading you found worked well and you enjoyed and profited from?

 

Regards

Andrew

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Similar thinking Hector re liquidity. So I too have been looking to focus on CFDs. In particular US indicies. As far as I know IG Markets and CMC (formerly deal 4 free) are the only alternatives. For shares IG allow market prices whereas the other mob create there own spreads. However, for index trading, IG make there own spreads as well. The question is (eventually), does this aspect concern you. Obviously US indicies have the liquidity (eg I get a daily US report that includes 1 min. charts on the major indicies- there's never any gaps) but this notion of not allowing market spreads concerns me. Your opinion is appreciated.
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If you go to www.CMCGroup.com.au you will see how it all works. There is a guy called David Johnstone, who set up Hometrader and is now doing small trading workshops on short term trading using CFD's. He is very good. His website is www.marketshare.net.au

After 8 years of trading and technical analysis I tend to get bogged down by too much info and Davids workshop will help to focus some of that knowledge into a more disciplined plan to trade both short and long on the top 20 or so market leaders. CFD's have stop loss facilities as well as conditional orders - "if abc trades at 4.50, then buy 3000" You open an account with $10,000 and you can trade parcels of $100,000 worth of stock. I find the movements in BHP, NAB etc much easier to read than the SPI or small spec stocks. If you can get on a falling NAB for 30 cents and you have used a margin of $6200 to short $62,000 worth (2000 CFD's) then your profit would be $600. These moves are not hard to read and you can put stop losses in to protect you.

 

Have a look at cmc group and marketshare and Catherine Daveys book on CFD Trading. Chris Tate and most professional Australian traders are using this vehicle. I still punt specs as well, but will be using CFDs to create an income.

Regards

Peter

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Hi all,

 

I'm enjoying reading and learning on http://www.cmcgroup.com.au. Does anyone have any hand on experience with this company? Hector, it seems you have. Is there anything important to know that the website doesnt cover?

 

Hector the www.marketshare.net.au site is a bit of a mess. Nevertheless I would be very interested in finding out more about any seminars in Adelaide. Though, when I click on the link I just get dates for QLD.

 

Also, the contact page isnt working so I cant get any contact information. Do you have an email address for me?

 

Thanks guys & gals

Andrew

 

 

 

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Hector thanks for your post re: David Johnstone. I signed up for his course yesterday, in Brisbane on Sat 17th April. I have heard some good things about this course...so I'm looking forward to it.

 

As an aside, is there anybody from this board going?...would love to meet a few members if they intend going.

 

Cheers BBQ

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I suggest that you try the 14 day free trial of the CMC trading platform where you can dummy trade with a margin of $10,000 - that way you can set up the trading page to suit you and have a go - try trading with BHP, NAB, WMR, these sorts of companies. SGB moves well and so does WOW. You can go long and short.

David Johnstons email address is ecco@iinet.net.au

More info on CFD trading is available in a recent book by Catherine Davey - guru trader.

Regards

Hector

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