I get a fair number of emails each day with questions about trading on the Internet, so I thought it would be useful to share a selection of these questions and my answers with you.
Your trading on the Internet queries answered
Q. I’m considering either to order the Back Dog Trading Software or Forex Robot Trader system, please advise the one you prefer out of these two.
A. It looks like Black dog changed their web address: Its now: http://www.blackdogforex.co.uk/. http://www.forexrobottrader.com from Don Steinitz appears to offer a number of products. There is an auto trading robot and some manual indicators. I am highly sceptical of bots and would always recommend manual trading over a bot.
I’ve no experience of his manual stuff, but will take a look at doing a review at some point in the future. I would recommend BlackDog though, not least because of the tremendous support and community around it.
I’m put off by forexrobottrader because they are selling a bot that claims to make no losses. The only way a bot can do that is if it uses some sort of loss recovery/ martingale money management strategy which this one obviously does. You can see this with the open trades with some being down over $1000 compared to the average profit about $30. In effect, the bot has no stop loss. It’s irresponsible and no doubt will wipe out an account at some point.
Q. Dear Mr David Evans, Could you please point out the major differences between trading on a meta-trader platform and a conventional (available with most of the spread bet companies) platform. Also what is or are the most suitable time frames for day trading? This is because I do not like to have a trade open overnight or by the same token over the weekend.
A. The difference is that most meta-trader platforms are mainly forex, but some also do indices and some US stocks. Spread betting platforms offer charts for virtually any market. Most spread betting companies platforms are web based while meta-trader is separate software. Meta-trader has a bigger following across brokers, with lots of custom indicators and expert advisors while spread betting firms offer very little customisation.
Suitable times for day trading, it depends on your strategy or system. You can have very successful systems that hold all day and close before the end, or just scalp over 10 minutes. The most popular time frame for short term trades is to use 5 minute charts.
Q. Hi Dave, can you tell me if you have looked at the Churchill Straus system at all?
A. I’ve no direct experience. It all looked a bit fishy to me and they never returned my emails. However, here is quite a useful forum thread which I have no reason to doubt the accuracy of. Click here: http://www.trade2win.com/boards/general-trading-chat/54568-churchill-strauss.html
Q. One other thing Dave, I was wondering if you have ever covered the subject of spread betting as your only source of income and if this changes the tax free rules that currently apply. If you was to spread bet for a living with no other source of income would this still be totally tax free?
A. It seems to be a grey area. My understanding is that you could argue the toss in your favour if it came to it, but continuing to maintain some form of taxable income would be an advantage. This is my approach and so far I’ve had no problems.
In some ways its important not to be put tax concerns before trading profits. If you are making substantial profits, it would be well worth contacting a knowledgeable tax accountant, it which case it might be a nice problem to have.
Q. Hello Dave. How are you? Have you come across Omni Trader on your travels?
Answer for all – I haven’t actually and my requests for review access have so far been rebuffed. Can any kind member help me out here with some feedback on Omni Trader?
If you’ve a question, comment or feedback on anything. Don’t hesitate to get in touch.