By DominicWalsh · Posted
By DominicWalsh · Posted
By DominicWalsh · Posted
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Question
Greeners
Hi
I tend to trade as a position trader and currently have open several cash funded spread bet positions on numerous shares (usually for several weeks or longer).
I have recently discovered that I can spread bet these positions as forward / quarterly funded positions and the IG academy suggests that this method is more cost effective than holding these longer term positions as Cash funded positions.
I understand that the wider spread reflects the increased cost and the material I have found on IG suggests this reflects the overnight funding charges for the quarter.
I can’t find anything that allows me to clearly see the difference in costs between holding a given long term position as a cash bet versus a quarterly bet and whether there is actually any benefit to be derived from doing so.
Can anyone help or advise. Does holding a quarterly position result in lower overall funding charges compared to cash and is there a cut off point where holding the position as a cash bet results in lower overnight funding charges. I.e. If I open a quarterly position and then sell with a week would I of been better to open as cash funded position.
I don’t find the charge information particularly clear Andy helpful in allowing me to work out the differences (if indeed there are any)
Thanks
Justin
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