Winning spread betting strategies

Malcolm Pryor is an active investor, trading coach and author, editing the website www.spreadbettingcentral.co.uk .

The theme of the book is about how to use spread betting (and equally CFDs) in a structured way to take advantage of medium term price movements, hence the ?investor? in the title. The author is a technical analyst, identifying opportunities from charts from a wide range of instruments, including currencies and indices as well as shares. He assumes that the investor has limited time available.

The author notes that successful traders have clear, often written plans for their trades with contingency plans for different situations. The first section of the book therefore sets out a number of rules, including the need to make an overall assessment of market direction and to pre-determine the maximum loss on a trade and entry and exit points or rules prior to trading – but his first rule is that the investor have a particular ?edge? or methodology for entering and exiting trades and that works for them. The main tools he uses in the book are visual inspection, ADX indicators and moving average combinations.

The second and much the longest section describes strategies for dealing with seven different market situations (for example, buying dips in upward trending markets, selling relative weakness in falling markets). Each example is carefully worked through, with the relevant Sharescope graphs, decision points and trading arithmetic. Realistically, not all of the examples result in profits or behave as expected but, in line with his first rule, are intended to show the processes and thinking different trading strategies rather than to be following slavishly.

This is a carefully written book that chartists will find useful.