My Spread Betting Rashness And Disastrous Consequences

Thanks to coming back to the market at the end of April, almost exactly at the worst possible time, I've ended taking some big spread betting losses on the chin. It happened to me 2 months ago or so. I was 'massively' up (relatively to all my portfolios), got over confident and overexposed myself and wiped my spread betting account plus some more in my matter of days as I refused to sell and kept lowering my stops in disbelief! I learned a very good lesson there... The fact is that if I were a rigid investor, then from April 26th I would not have even been looking at long positions, I believe many more investors have been caught out with similar timings. The thing is that for common inexperienced investors it is best to enter the market when it is at least looking like it will go up, a simple look at a macd weekly would show that from late April unless you are a more sophisticated trader, you are swimming against the tide, The problem is new people to the market don't probably know what technical analysis is and if you mention it to them they think you're talking voodoo.

I have learned a few awful lessons trying to trade through these periods before as spikes have taken out those loose stops on some rather bullish positions taken out back then in October 2008, whilst I was away working.. 40/45 % down now [was using bold stakes on spread betting]. There's nothing worse than not selling because you believe it's about to reverse and then it falls some more. I find it difficult to differentiate from short term trading to holding stuff through the ups and downs and having a conviction for the longer term. My trouble is that I'm looking for income too, so I don't want to see my profits falling. So that makes me a short term trader and I should manage my trades on that basis - at last I've learnt something. That and keeping clear of the illiquid shares unless it's a sure bet (is there such a thing!?). And lastly don't play with what you can't afford to lose...etc I have only one spread betting position left now on Enquest (ENQ), which had been a darling through all of this, but is now squealing, good old afr is my isa so that can just sit there [20pc down on that too].

And lastly don't play with what you can't afford to lose...etc In any case, the idea of logging on in the morning and doing a few trades, earning a nice wad and then having the rest of the day in the gym/coffee shop/looking for houses seems to have gotten away from me a bit!!! ;(

By: Andy Richardson

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My name is Peter Wong. I have been trading through the spread trading medium for some 2 years now. I am profitable currently, but working on making this consistent, as well as attempting to build my capital to a level where the profits actually mean something. In my freetime I also help with updating the website of my mentor: Stock Market Guide