Preferred CFD Providers

YOUNG_TRADER said:

Hi there,
Have been looking @ CFD's for awhile now am considering giving them a go.

I have beend looking at the main 4 providers,

IG, CMC, Macquarie and Man Finanacial

As far as resource stocks go, Macquarie requires a margin of between 10% - 45% (45% almost defeats the purpose of leverage), but are obviously secure because they are backed by Macquarie and offer DMA with some GSL and shorting,

CMC seem to be the most flexible ie very little margins required, huge leverage allowed (ie lose more ) Stop losses?
They creat their own market spread? so not DMA, I gather that this is bad as they will always construct the spread so that they win long term.

I really like the look of IG markets, Very low margins on resource stocks I like, much better thnn Macquarie and they allow GSL (with slight premiums)
How have people found IG Markets, especailly their L2 DMA System?



Don't know much about Man Financial


I would be interested to know how others are finding their CFD providers, how realiable is the software, how realiabe is the provider, how quickly do they transfer funds etc etc


Thanks in advance

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nizar said:

I heard macquarie offers guaranteed stops, i dont know maybe the others also offer this..

And i agree YT 45% leverage is a joke...

But with all those 4 CFD providers u can only get leverage on top300 companies?

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phoenixrising said:

I started with IG early last year, then opened with Man shortly after, when they became available.

Negatives for IG - non DMA, hard to use platform, at times of hi volatility they won,t allow trades. Eg, someone could't take OXR @ 2.94 open, IG refused last week. (I took it on Man, currently 3.50 or so)

Positives for IG - GSLO - for a premium

Positives for man - ease of use, big reputable co.

Negatives for Man - no GSLO, $10k starting cap (may be $5k now)

If talking to IG, grill them on the volatility issue, both long and short. This is where cfd's are supposed to have a big advantage, to be told no trades is not good.

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YOUNG_TRADER said:

IG do offer DMA via their L2 platform

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chemist said:

What does DMA matter? AFAIK it is part of the provider's risk management system, not something that affects the prices you receive. As long as I receive market prices (+/- spread) then I don't care how the provider hedges.

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mlennox said:

checkout this website list of all the providers compared on this page....

http://cfdtools.com/au/content/view/53/50/

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Porper said:

I disagree there Chemist.

Having IG match your order in the depth must have an effect on the price of the underlying share.It won't effect the price for you, but will effect the price thereafter as "real" shares have been purchased or sold.

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Bobby said:

Hello Porper,

Can you elaborate more on your obove comment regarding effect on Real share price please.

Bob.

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Porper said:

No problem Bobby.

I can only comment on how IG Markets works, so here goes.

With their basic platform let's say you buy 20,000 shares as a CFD in company XYZ. IG only quote the exact same prices as in the underlying share.so you buy 20,000 at the ask which is $1.00,neither you nor IG have bought any shares in XYZ, you are merely entering a contract with them.How they hedge against this I don't know, when I asked they said they try and match buyers with sellers ?? anyway going off topic now.

So in the above example you have not influenced the underlying share price one bit.

Now with their L2 dealer system (direct market access).Same scenario.You buy 20,000 shares in XYZ as a CFD, difference is this time as soon as you press the buy button they will put an order for 20,000 shares in XYZ , so you will see a buy order for a dollar in the buy depth.Obviousy this now effects the share price directly.

This is merely the point I was making in response to Chemists post.
__________________
The best way to save money is not to lose it.

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Porper said:

No problem Bobby.

I can only comment on how IG Markets works, so here goes.

With their basic platform let's say you buy 20,000 shares as a CFD in company XYZ. IG only quote the exact same prices as in the underlying share.so you buy 20,000 at the ask which is $1.00,neither you nor IG have bought any shares in XYZ, you are merely entering a contract with them.How they hedge against this I don't know, when I asked they said they try and match buyers with sellers ?? anyway going off topic now.

So in the above example you have not influenced the underlying share price one bit.

Now with their L2 dealer system (direct market access).Same scenario.You buy 20,000 shares in XYZ as a CFD, difference is this time as soon as you press the buy button they will put an order for 20,000 shares in XYZ , so you will see a buy order for a dollar in the buy depth.Obviousy this now effects the share price directly.

This is merely the point I was making in response to Chemists post.
__________________
The best way to save money is not to lose it.

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robots said:

hello,

i dont believe they hedge, these terms DMA, L2 dealer platform are all "glossy" descriptions to compliment the CFD package

how CFD's, options, futures etc can be called financial instruments or be of any use to an "investor" is beyond me

having said that, to a punter, they provide an opportunity to "punt" on shares, indices etc.

getting back to CFD providers,

I used IG Index for some time and had tuff time getting money out second time round

thankyou
robots

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