CMCMarkets

CMCmarkets specialises in online trading in contracts for difference and spread betting.


Wagerable instruments:

Spread bets can be placed on all the following instruments: Shares, Indices and index futures, Sectors, Forex and Bullion, Treasury (Bonds and interest rates) and Commodities.


Minimum Stake

The minimum stake for all instruments is £1 per point. All bets must be multiples of £1.


Margin Requirement

For individual shares, initial margin is 5% of the value of the bet. All other initial margin requirements are based on the Notional Trading Requirement system, namely the stake per point times the NTR factor which can be found in the Dealing Guide.


Risk Controls

Limit Orders: An instruction to open a new position or close out an existing one at given prices. Executed at the specified price.

Stop orders: Set to limit the loss at a given price by closing out. Not guaranteed to be executed at the stop price and therefore free.

Guaranteed stop loss: An instruction to close out a a guaranteed predetermined price (buy or sell) at the cost of a few extra points on the spread.

One Cancels the Other (OCO): A stop loss at one end of the spread and a limit order at the other end. If one is triggered then the other is cancelled.

Market On Close: An instruction not to roll the bet over automatically at the end of the day. The bet is closed out at the end of the trading day.


CMCmarkets do not charge commission, brokerage or annual maintenance fees. They claim to make a profit through software efficiencies and by market making rather than broking (cutting out the middleman).

Bid-Offer Spread: The 'Price Driven System' delivers 'real-time' spread quotes from the dealers that may change rapidly in volatile markets.

Cost of Carry: All best other than Controlled Risk Bets (CRBs) are automatically rolled over to the next dealing period at expiry, unless closed out. The bid-offer spread is waived for rollovers and is replaced by a 'financing adjustment' based on an interest rate and the value of the open position, otherwise known as 'cost of carriage'.

Where you place an up-bet, there will be a charge based on the length of time that you keep the position open. This compensates CMCmarkets for the costs of hedging your bet given that you are only required to put up initial margin. Conversely, with down-bets the punter will receive a financing adjustment for effectively lending money to Deal4free.


Tools

The Spreadbet Spread Finder produces live 'snapshot' spreads captured at 15.15 hours every day to compare with those of the competition.

Spreadbet Calculator Enter the bid/ask price of the underlying asset, the margin requirement an a market movement (up or down). Hit 'buy' or 'sell' for the total outlay, breakeven price, profit/loss and the total return on margin. You can compare the outcome with that on a rival broker and traditional stockbroker after entering the commission rate, margin requirement.

The online dealing guide is a mighty 96 PDF tome that serves as both a key features document and an excellent introduction to the intricacies of spread betting itself.