Did you know you can trade the FTSE 100 with as little as £70 margin? As a result of the new margin rules imposed by ESMA, IG have introduced a new product for traders with small funds, it’s called FTSE 100 knock out. See https://www.ig.com/uk/help-and-support/spread-betting-and-cfds/market-details/what-are-knock-outs#how-do-I-use-the-knock-out-ticket
Basically the knock out price is your stop loss. The spread between the knock out level and the current price is what you buy or sell. If you think the FTSE 100 will go up you buy the spread (open a bull knock out). If the FTSE goes up 100 pts, the spread will increase by 100 pts, so you make 100 pts profit. It is like trading the FTSE but with lower margin as your margin is the spread between knock out level and current price time the bet. Plus there is a premium of 0.8 pts to pay if the knock out level is hit. The tighter the spread the lower the required margin.
From today I will provide my tips on FTSE 100 knock outs. If you don’t have a spread betting account with IG please open an account here (only for spread betting):
My tip is
Open a FTSE 100 bear KO at 100 or lower, knock out level 7400
If the price to open is more than 100 you must wait until it is at 100 or lower before opening the trade.
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