There is something odd going on in the world of spreadbetting. The cost of borrowing stock for shorting purposes has shot up. A longstanding and highly reliable friend last week told me that he had enquired at Spreadex and been told that all short positions – i.e. regardless of the true ease with which stock can be borrowed – were costing customers 10% p.a. even if (or perhaps especially because) the short was carried by Spreadex – i.e. it was never hedged in the first place. To be clear, this means that, say, one were to open a £100,000 short, one would have to have made £10,000 by the end of the first year merely to cover borrowing costs. Anyone taking on this challenge has to be mad or an insider trader.
I am of course fascinated to hear from others as to their experiences.
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Ascot proved variable if downwards. I lost £70,000 despite some good wins. Especially disappointing was having £30,000 on Harry Angel at 3/1 and seeing him get stuck in the stalls when they opened. Equally disappointing was standing to win £85,000 on Paul Casey in the golf in America and seeing him blow it (having been 1/5 at one stage) in the last few holes. Swings and roundabouts.
In Harry Angel’s race I had “hedged” by backing City Light to win £100,000. He finished second by a short head.
There are times…
Anyway, the World Cup proceeds and I trust that by Thursday I’ll be able to bet massively against England. You know it makes sense. Just don’t tell anybody.