Trading Systems For Profitable Spread Betting

Trading Systems For Profitable Spread Betting

By Andy Richardson

Humans are hard wired in life to succeed and by definition we measure success by successful achievements. When people try their hand at trading they try and use the same measurements and inevitably become stuck in a loop of jumping from system to system tweaking this and that and eventually giving up.

So many newbies think they understand the basics but actually have no clue. You can lose 7 out of every 10 trades and still make money but 90% of traders can't understand this and it isn't an odd coincidence that 90% fail. Remember that not all trading systems are created equal. Now there are a few basics a person needs to become successful -:

1. A set of setups combined with rules that over time guarantees a particular outcome with a win ratio that enables the trader to make money like a casino.


2. Money management


3. Soldier like mental control. Trading is 70% mental and 30% method. A trader needs to understand that not every move is a setup and not every setup is good and waiting for the right setups with no exceptions can be very rewarding. A trader also needs to trade only when he has a plan, by this I mean has the setup filled all the requirements, does the trade qualify a good risk reward ratio, stop and targets must be known.

Now as simple as these concepts are the typical trader fails to master them and from observing so many novices I have identified some common traits. Firstly new traders seem to hang onto the fact that their system is the problem and they also seem to think they need to win more than they lose. This mindset is what makes 90% fail. Now you are probably wondering what system I use and whether I'm willing to share it.

Yes, I am but the fact is there are a hundred ways to trade the market and what works for me might not for you. Let's talk about trading systems, indicator...etc - for a system to be good it needs to meet the following requirements -:

1. Repeatable setups


2. Low risk, high reward


3. No indicators , they are rubbish and cannot compare to price action. Indicator traders rely on them too much and as a result they ignore what price is telling them.

That's it!!! You don't need anything else and when testing systems you must have one that can give you this. Now back to the 7/10 trades, let's take a real close look and give the 20 second explanation. If your system gives you favourable risk/rewards ratios then all you need is 3 winners out of every 10 trades to succeed. One of my methods is simply the Andrews Pitchfork and price action. Price always has a frequency and Andrews Pitchfork catches these beautifully. I typically have setups that allow me risking no more than 20 pips with rewards of 100+ and i maintain a win/loss ratio of around 50-60%.

Andy Richardson a UK based spread trader, who like his inspiration, the late Jesse Livermore is a student of the markets and plays a lone hand. Resident financial spread betting expert Andy publishes a question and answer spread betting guide where one can find objective spread trading information.

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Make The Most Of British Spread Betting

Make The Most Of British Spread Betting

By: Shaun Parker

We Brits love to bet. We always have and most likely always will. We bet on sports. We bet on games. We even bet on television and on superstars. We can't seem to help ourselves - perhaps it is in our blood. Whatever the reason we can't get enough, it is evident that we are in our glory now that we can take our passion online and bet even easier than ever before. One clear indication of this is that the majority of the last World Cup bets were placed online and that overall betting on that event was up 60% from the previous World Cup.

While there are in fact other nations that do appreciate betting to some degree, it seems that we are well ahead in a lot of those statistics. One such example is spread betting. Spread betting is not even allowed by law in many places including the United States. In Britain, one estimate is that up to 400,000 of us currently have spread betting accounts.

Basic Spread Betting

Spread betting involves complicated sporting indexes that are made up from the odds of certain things happening. For example, the index may say that in a particular game, there will be between 10 and 15 points awarded in a certain type of play or certain type of goal. That means that the 'spread' is 10-15. A better who bets (or 'buys') in at 1 pound will then either win or lose money based on if the actual number of those type of goals ended up under the spread or over the spread amount. If the actual number was less than 10, the better must pay out money lost. If the actual number is higher than the spread, the better wins.

Spread Betting and Finance

Outside Britain, spread betting is more of a financial term. Especially in the U.S., it is seen as a money game for investors who play the markets. Spread betting in this case is done when companies provide the chance to gamble on the future prices of commodities or on company stock.

Spread betting is generally seen as a high risk financial game and it does not have a place in sport and entertainment gambling in most places outside Britain. As we know however, the internet has erased borders in many ways and online spread betting in the UK is being enjoyed by people from all over the world.

Cautious Enjoyment

While we aren't afraid of spread betting and what it has to offer here in Britain, it isn't for everyone. Experts caution us against getting into this type of betting if we are not familiar with how the numbers work and the fact that we can lose more than our bet in one fell swoop. Once you learn the ropes and decide you can afford it, it might just be the game for you too.

Never considered faint of heart, Britons are actually embracing spread betting in ever increasing numbers. It can be an exhilarating change to regular betting and many like the additional risk involved in this kind of play.

Author Resource:-> Shaun Parker is an expert on betting. He often uses spread betting, online betting and sports betting techniques to make the most of his money.

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The Purpose Of Spread Betting

The Purpose Of Spread Betting

By: Shaun Parker

For many gamblers, in fact the mass majority of them, sports betting is something done just for a bit of fun. It's easy and very straight forward: I'll bet this team wins over that one. Done. The bets are placed at the bookmakers either online or on the High Street, and depending on the odds given on each team the winner will take home the money he or she originally bet plus a percentage on top of that. The loser simply does't get the original bet back and goes home with a lighter wallet than when he started out.

Spread betting can seem like a much more complicated way of gambling for people like this, in particular gamblers who are new to the world of sports bets, but it can be every bit as simple as regular betting. The difference is that spread betting makes the odds higher and the chances of winning not so black and white.

A Second Dimension

In a regular gamble on a two-team game, for example, people would choose one team over the other to win, and if they are right they win money. If they are wrong, they lose their bet. In many instances, however, it is fairly obvious which team will win and which will lose. This can happen with any kind of tournament where the more talented teams are split into different pools to compete with the less fortunate teams; if a very strong team is pitted against one who barely made it into the tournament, straight forward betting becomes not only dull but the paybacks are minimal as well.

Complicated or Enhanced?

To make the gambling process more interesting and to make sure the punters come in for their usual bookmaker tickets, spread betting gives the gamblers something else to consider instead of whether one team is better than the other. In these instances, the bookmaker decides on a 'spread' number, for example 7 in an American football game.

The underdog and the strong team are blatantly posted, and gamblers may bet on either side, deciding to 'take' or 'give' the posted point spread. By betting on the team most likely to lose, the gambler is taking the points, and if the spread plus the final score of that team is higher than the expected winner, the gambler has won the bet. Conversely, if the gambler bets on the expected winner, the end score of that team minus the spread must still be higher than the points of the underdog team.

Spread betting piques the interest of the seasoned gambler where the outcome of the game is seemingly fairly cut and dried; if you're tired of the usual win-or-lose bets then it couldn't hurt to dip your hand into the spread betting pool.

Author Resource:-> Shaun Parker is an expert on betting. He often uses spread betting, online betting and sports betting techniques to make the most of his money.

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CMC Market Issues: Got My Trading Bonus Back Though!

It’s 9.30. I overslept. The market is in freefall. I want to check my positions for some piece of mind before I do any work today. Fortunately they are all shorts – I am currently short on a selection of retailers.

What greets me at cmc markets?

Important Messages: The service is currently unavailable, please try again later

Grrrr.. this isn’t the first time either…

Finally manage to log in at 9.55 and see all but one of my positions in profit. For some reason Topps Tiles has managed to gain much of the 20% or so it lost yesterday.

Maybe someone is still buying houses?

Have sent cmc an email to ask why I couldn’t log on, will be interesting to see what they say.

On the plus side, they have credited me my £100 trading bonus.

Just heard back from CMC. Apparently they were ‘experiencing some issues with the platform.’. Nice and specific eh?

For the record I am currently shorting:

Burberry (BRBY UK)
Sainsburys (SBRY UK)
Woolworths (WLW UK)
HMV (HMV UK)
NEXT (NXT UK)
Ted Baker (TBK UK)
Topps Tiles (TPT UK)


All bets were placed 06/08 and are for the Sept 08 quarter. I’d be very surprised if retailers are looking any happier in the next couple of months, so not intending to close yet.

Diary of a Spread Better: Thoughts And Experiences

A Few Thoughts About My Ongoing Experiences With Spread Betting

I'm no millionaire trader, so the pro's may want to look elsewhere for their tips, but maybe some of my mistakes and experiences may help one or two people out there out there, and it would be good to share thoughts via the comments.

I’ve enjoyed a punt on and off for a few years now, sometime successfully, and sometime disastrously. I think that I have learnt from many of my mistakes, and hope one day to become consistently profitable.

I remember when my naïve eyes first discovered spread betting; it appeared to me to offer an easy way of making money. It only required a small stake, which could be placed with a stop-loss, and offered unlimited profits if the bet went the right way. How could you lose?

I was quite wrong. – Unfortunately it does take some work, and a little luck can be good thing too!

The spread better needs to know exactly what they are up against, of which there are 3.

The perfect market
The spread betting company
Everyone else

The first thing we need to understand is the perfect market theorem.

The perfect market theorem suggests that at any one time, the price of a share, commodity etc reflect all that is known about it at that time, by all participants in the market. It reflects not only its current worth, but also the participants’ future expectations.

In a perfect market, it is not possible to predict the future movements, as only an unknown factor can change the price. It could equally be up or down.

The perfect market theorem is often seen in action before a company releases a profit warning. If the profit warning was widely expected due to market conditions, the price will already have dropped prior to the warning – In line with it’s expected worth after the expected news.

If you believe the perfect market theorem, it’s probably best to give up on spread betting now, as you accept the mathematical probability that you will win 50% of your bets, lose 50%, and also lose the providers spread each and every time. This would not be a good way to make money.

If however, you believe the market acts irrationally at times (and I don’t think we need to look much further than the dot.com bubble or our current housing market for proof of that), and you can spot that mispricing, then spread betting may be for you…

Next up is the spread betting provider. Don’t get me wrong, they’re not your enemy, but they do need to make money. As a novice, you’ll probably swear blind they’ve ripped you off from time to time – such as when a trade cannot be executed in a timely manner, or when the platform craps out on you, or a trade mysteriously ‘slips’ a few points. In my experience, spread betting is not well suited for scalping (opening and closing positions in a very short space of time, to make a quick profits on a small movement) due to these sometime questionable slips. More of that later.

Finally, it’s also worth remembering when spread betting that for ever winner, there is a loser. For every bet you win, someone, somewhere has lost. So you need to be smarter than the other guy.

To sum up...IF:

- You don’t believe the perfect market theorem
- You can live with a little frustration from time to time
- You are better at predicting than 50% of other traders.

Spread betting is for you…