T Trades

I have always viewed T Trading as almost the same as a bet at the bookies, although, one could argue that in the current market any investment is a bit like that.
I do have one friend who T Trades successfully, but, I am sure there are many others who do it unsuccessfully but never tell me!!

Let’s say you have just 2k to invest…let’s suppose the stock is at 97p – you can buy about 2000 shares less dealing costs, if the stock price goes up to 120p, you will make the princely sum of 460 quid, which is better than a kick in the gonads, but isn’t much. Instead of spread betting, you can open a dealing account and buy on a T20 and try and trade your way into some profit, but with such a low starting capital you might struggle to make headway unless you get a lucky break. With 2000 shares, every 1p change is worth +/-20 quid so you need quite a bit of a rise to make any money.

Please can you explain how to:

then roll it T25 so you can effectively hold a share for 45 days… with TDW

Are there penalties for t-trades (interest, wider spread, larger fees etc) and do you need to have a back up pot in place? I am looking to start small spread betting (probably towards the end of the month) foe very small amounts initially to see how things go.

You buy it T 20 and you then have to ring the awfully nice chaps at TDW on T3 or T2 and say please may I roll it T2/T25 at the top end so you don’t get exposed to the whole spread. so you effectively sell the stock at a shade under offer and buy it back at offer and you pocket the profit or loss….

Takes a while as they go to market I often think they pretend to go to the market and maybe do it on their own books!! They don’t mind as its more commissions…other brokers will do T10 and T20…….

But you really have to watch the end period as the market makers will yank it down around T2….If you’re sneaky you can buy some more as they yank it down and buy your stock in and then it pops up the next day….in some cases these unexplained dips are just that..of course if it carries on going down you get royally shafted so always have some spare cash

Alternatively you can sell your stock T5 wait for it to go down on the T3 period and buy it back more cheaply than you sold it for I just done that one and of course it’s safer and cheaper if it works…….. But whenever you get spikes you can be sure some are swimming without their pants and you need to count the days and get in the rhythm….but it is not full proof at all……

And to be honest with t trades, dealing costs are gonna eat into any profits. In our example above if it’s a single share ‘bet’ that you want then maybe buy in two tranches of say 1000 each time, so when you buy, if the share price drops a few pence, then you could invest the rest and hope you catch it somewhere near the bottom of the trading range for the day/week/month etc.

Personally reckon that most T20 boys get stung ….why people don’t do spread betting with sufficient margin or buy share outright is beyond me…..see it time and time again. Better to look for a couple of stocks and split the money and hedge your bets. if you can time it right, you might be able to bank some good profits.

(mind you I used to get caught out as regular as clock work when I was a lad)

With the spread, cost of dealing, margin calls and short term fluctuations, etc T Trades are imo far more likely to lose money if they have to close before settling as the odds are stacked against them. Like a casino it is not an even money market. Unless they are in a rampant bull phase, which we are certainly not in now.