Zak Mir reviews Alpesh Patels brand new book – “How to win at Spread Betting”
By Zak Mir.
Although SpreadBet Magazine is hot on making the big spread betting calls, I believe it also falls on our shoulders to help explain the mechanics of this form of trading. While there are many professional traders and investors who use spread betting as a weapon in their financial arsenals, the majority of spread betters are in fact private investors and individuals.
For the most part, the statistics are not very positive about how consistently profitable these “amateurs” are. There seems to be a variety of reasons for this. Perhaps it is because this group regards spread betting as “having a punt” or maybe they don’t really expect to make money? It could even be that they don’t “want” to make money this way.
As surprising as these conclusions might sound, I suggest them, based on my 10 years experience as a derivatives broker. During this time, I was consistently amazed at the great talent most retail clients appeared to have in following bad advice and rejecting ideas that would have made them money. Now I think about it, it was quite astonishing really. I don’t say this to try and put myself on a pedestal; it was just an unfortunate fact of life.
So, with these thoughts never far from my mind, I am now reviewing the latest book by Alpesh Patel, “How To Win At Spread Betting”. (As an aside, please remember that we have secured a special deal for SpreadBet Magazine readers. You can get a free copy of Alpesh’s book here).
When I first saw this book announced, I was so keen to get a copy, I requested an advance copy from the publisher. I was in such a rush to read my old friend Alpesh’s book because I had seen it publicised that within it he was going to release the findings of a survey, based on five years of trading data.
I was not disappointed.
In his survey, Alpesh sought to blow away many of the myths surrounding the spread betting industry and to shed light on its mysteries. If you are a regular spread better, this book contains a wealth of invaluable insight into how this game works!
Since first reading “How To Win At Spread Betting”, co-written by Paresh H. Kiri, I have been mulling over the questions Alpesh asked, the answers he gave and the statistics he used. If I’m really honest, this is exactly the sort of book I would like to have written myself. As you would expect from someone who has an IQ of 178, is a graduate of Oxford and is a trained barrister, Alpesh’s work is laid out in an incisive, thoughtful and thorough manner. He rapidly gets to grips with the main issues, quickly presenting the reader with key findings and practical lessons, which can be taken away.
For example – Is it better to trade Dollar/Yen or Euro/Dollar, can you make money on the long side or short side more quickly or should you use technical or fundamental analysis?
These are just some of the many crucial questions Alpesh asks. When I first started spread betting 20 years ago, the answers he provides would have been exactly what I needed. Had I had them, way back in the distant past, no doubt they would have saved me from many of my early mistakes.
Of course, this is not to say that I didn’t find the book useful today as an experienced spread better.
Quite the reverse in fact; I found lots of valuable lessons. I enjoyed being reminded that spread betting firms tend only to hedge against their winning clients (presumably finding them not too difficult to spot!). On a practical level, it was interesting to learn that less than 50% of spread betters make money on the AUD/JPY pair, while over 70% are profitable on AUD/NZD. This provides a fairly compelling argument to switch to the latter cross, when trading. This is especially the case considering that less than 60% of spread betters are profitable on the heavyweights, such as EUR/USD and USD/JPY.
However, what really caught my attention most (and there will be no surprises here) was Alpesh’s treatment of technical analysis, a subject extremely close to my heart.
I don’t want to spoil what Alpesh has to say on TA, suffice to give a little reassurance that his view is that it isn’t all bunkum. He takes readers through a superb review of breakout strategies, using MACD, RSI and Stochastics and gets to the bottom of whether or not charting really works in practice. This is a must read for all spread betters and, I am glad to say, it appears there is hope for the likes of Zak Mir!
And so to conclude the review, I suppose for the sake of balance, I should offer some criticism in my review of Alpesh’s work. Although I have to admit I am struggling here. The “insider” data, which Alpesh provides, on who wins, who loses and how to conquer this difficult area of trading is far more gripping than it sounds. Even though there is a lot to absorb, by the end you will find you want to know more.
There has been a huge gap in the market for this type of book for a long time now, and it is great news that it is finally filled. So, I suppose that if I have any complaint to make, then I have to ask “what took you so long to write this Alpesh?!”
I eagerly look forward to the second volume of “How To Win At Spread Betting”.
Comments (0)