Impatience is costly - Plus 500


(Rob) #1

Oh dear, I am a sucker. As an androider I am still waiting to get going with freetrade. In the mean time I have been using PLUS 500 which offers leveraged buying and selling of stocks, indicies etc.
PLEASE BE AWARE of what happened to me twice today. I bought in to Austria 20 index and was charged an extra £5 more than the buy price. The difference was huge considering the buy price typically results in an immediate loss of around 30p for an £80 outlay!
The same thing happened later when I bought sterling against dollars. Once again an extra £5 was slapped on the buy price so instead of an initial loss of 30p I had £5.30 to recover!
On neither occasion was there any significant price movement - and it would have to be hugely significant to create an instant £5 loss!
On complaining I was told “well the price is always changing”, What a SCAM. They either have a bug in the software or they are hoping people will not notice.


(Emma) #2

It’s hard to scream scam when prices do fluctuate all the time.
There wasn’t a hidden fee you hadn’t noticed?


(Matthew) #3

Check out the warning strap line at the bottom of the plus500 home page.

" CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 80.6% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

It sounds like your experience is inline with the majority of people whom use the site.

Live and learn…
Matt


(Rob) #4

No, I had been trading most of the day with £/$ so £5 over the usual initial loss would quite literally have been off the chart (graph actually). I have gone back and checked the prices at the time of the trades and it is not a mistake by me. Extra fees? I have checked and no such fees exist. I double checked on a broker review site too.


(Rob) #5

LOL, well copied! I read that about ten minutes ago on the review site. I am now very suspicious of them.


(Emma) #6

All U.K. providers of CFDs are legally required to show that warning. All have similar high loss figures because most people lose money due to the nature of the product


#7

I stopped using CFD/Spreads.

For one the leverage means you’ll often be exposed to a larger position than you actually want to hold. On FX for example 50p a point minimum means you’re basically exposed to an underlying position of £6544. Larger position sizes than you want mean you can get shaked out of the market more easily, either by being stopped out, or because of the larger numbers make you panic and then your chances of that position turning positive are all but surrendered.

Secondly these sites often charge daily maintenance charges on open positions, making it an expensive way of taking a position over the long term, and sometimes in markets one needs to be patient before they move your way.

I have been trading stocks for 2 years and am a profitable investor. I played around with Spread Betting/CFDs for some years before that and was a net loser. Investing in stocks suits my patient capital investment style better, plus I like to pick up dividends and reinvest them where I see fit.


(Rob) #8

I agree with you James. I have ruled out spread betting for shares or any long term investment as the overnight fees are just about impossible to recover and the spread is way to wide.
I stick to what PLUS 500 call their popular investments. Currencies and some well known indexes. Their margins are smaller (except when they throw in a scam fiver) and there is always movement.

The leverage has been cut to 30x for private, non professional traders which is pretty tame if you are staking maybe £100 and never move too far from the screen!

I, like the “80% of investors”, am losing****overall so can’t wait to get going with FREETRADE


#9

I believe that price moves are essentially random to the average retail investor so these spread betting/option/margin/leverage stories are scary. 30x doesn’t sound tame to me, it sounds terrifying.


(Dave Smith) #10

My experience is similar, I generally do OK with stocks over a longer timeframe. Even if I get it wrong and end up sitting on a loss I can usually hold for a while and it comes back to me, The short term nature of spread betting and leveraged products means you can’t really hold indefinitely and wait for it to turn around


(Chris) #11

Avoiding CFD’s is the only advice here, at least for 99.99% of people. Its a financial flamethrower, sounds cool but likely to hurt you.


(Ritchie) #12

I was just about to comment that! I always send requests to YouTube that the Plus500 ads are banned for me. As far as I’m concerned it is online gambling where you are given worse odds than any other provider.


(Alex Sherwood) #16

We’re not fans of CFD trading at Freetrade either, as we’ve explained in this blog post. But we want this community to be a place for constructive discussion about alternative services to Freetrade, not somewhere to make accusations that are hard to prove. I have a lot of sympathy with some of the concerns that’ve been raised but if you’re having issues to do with your account specifically, it’s best to contact the company directly. So for now, I’ll close this thread.


(Alex Sherwood) closed #17