DTT

Dear All Scenario: At 10 am I open a £3 trade to go long. I then place 6 net-off sell trades in the order book. The sell trades are 25 points apart and each net-of trade is 50p. The long trade opened at 5000, and the net-off sell trades in the order book are at: 4975, 4950, 4925, 4900, 4875 and 4850. At 11 am I open another £3 trade to go long. I then place 6 net-off sell trades in the order book. The sell trades are 25 points apart and each net-of trade is 50p. The long trade opened at 5200, and the net-off sell trades in the order book are at: 5175, 5150, 5125, 5100, 5075 and 5050. At 11:30 the market price comes down from 5200 to 5145. As a consequence, 2 net-off sell trades execute. As the the net-off sell trades are 50p each, the total amount netted off is £1. Which long position has £1 netted-off against it; the £3 trade at 5000, the £3 trade at 5200, or 50p is netted off both? I look forward to reading your replies. Thanks C

Hi From experience I can give the following suggestions: Long Positions are good because the FTSE will never hit zero but has (in theory) unlimited upside. Allow for a big margin to absorb volatility. IG allow for 50p trades so if you don't have thousands on your account, consider smaller trade sizes Long Positions are good because you can scoop up easy points when the FTSE goes ex-dividend every Wednesday and this will off-set fees charged for positions held overnight. Keep an eye on price movement ranges and support/resistance levels as you may get caught behind a major level of resistance. Every time you close a position in loss, you reduce your account size which inhibits your ability to trade (see point 2). Hope this helps? All the best