About Delta Index
Trading
Money Matters
Pricing
My Account
What are the trading hours?
Delta Index is open for trading from 7.00am - 9.15pm
How can I find out more?
Call us on 1850 88 20 20 with any queries you may have or visit www.deltaindex.ie
How does Delta Index make money from Financial Spread Betting?
Our only charge is the spread. We aggregate trades from our clients and hedge the total position with our brokers. Our gross profit is the difference between the retail spread that you pay and the wholesale spread that we pay.
What is the difference between Financial Spread Betting and CFDs?
The main difference between the two is that if you use FSB rather than CFDs, you will not pay any capital gains tax on profits. CFDs, unlike spread bets, also involve commissions, calculated as a percentage of the value of the transaction.
How do I calculate whether I should be using Financial Spread Betting quarterlies, rolling trades, or share ownership?
Generally, quarterly contracts are more cost effective for longer-term traders. Rolling trades are better for short-term traders who pay a tighter opening spread but a higher financing charge. However, rolling trades are also useful for traders who don't want the hassle of having to roll over their trades. One of the major advantages of financial spread betting over conventional share investment is that gains are free from capital gains tax. The amount of tax payable on share investment will vary with the return made. The optimal cut-off between making an investment through a spread bet versus buying the share outright really depends on the return earned. As a broad rule of thumb, a holding period of up to three or four years (assuming moderate positive return) should make the spread bet a better option.
What is the Futures Market?
The futures price is a combination of the cash price and the cost of financing the open position up to the expiry date. The difference between the cash price and the futures price therefore lessens as expiry approaches. The cash price and the futures price usually move in tandem. The futures price will also reflect dividend adjustments.
If I wish to trade a contract not currently on your system, can I put in a request?
Let us know either by phone or email what you are interested in trading in. We will send your request to the trading desk where it will be researched in terms of liquidity and volatility and whether a live price can be accessed from the exchange. If it fulfils these criteria, we will add it to the trading platform as soon as possible.
How can I work out my exposure on a position?
Your exposure is per point, for each point in the price you have a 1 times the stake at risk. For example: BOI 1000 x €10 stake = €10,000 exposure. That would mean that a €10 stake on BOI is the same as owning €10,000 worth of BOI shares in terms of the underlying risk. If BOI were to close with no value left in the shares, you would have lost €10,000 and if BOI doubled in price you would have gained €10,000.
What are rolling trades?
Rolling trades allow you to hold a position indefinitely without having to roll the trade over; they are based on the cash price of the underlying instrument. They retain the advantages of leverage and no capital gains tax. Other advantages include:
- Simplicity - no expiry
- Tighter spreads
- Dividends are paid directly to your account
If I buy into the September contract while the June contract is still open is the spread wider?
Yes. The spread will be slightly wider - by two points on average. For example, if you wish to trade the June contract the spread will be 10, however, if you decide to opt for the September contract the spread will be 12.
When is the next contract introduced?
The new equity contracts are introduced on the 1st trading day of the month prior to the current expiry month. The commoditised products are introduced on the first trading day of the month of expiry. For example, BOI Mar would be enabled on the 1st trading day in November and Dow Jones March would be enabled on the 1st trading day in December.
Can we move the stop loss down/up further?
Yes, this is possible; however there is a small exclusion zone close to the price so that your order doesn't get hit straight away.
Can I lose more than my deposit?
Yes. If a contract moves against you further than the value of the deposit, you could lose more than your deposit. We automatically put in a stop loss at 50% of the required margin.
Does Delta Index offer trading advice?
No, we don't offer advice in what to trade, but we're happy to talk through any questions or thoughts you might have. We can also make you aware of any market developments that may shape your thinking.
Why is Financial Spread Betting tax free?
People often wonder why Financial Spread Betting is tax-free. Unlike share ownership, you do not own an asset when you open a spread bet. Therefore when you make a gain, it's a betting gain rather than a capital gain. In Ireland, betting gains are not taxable so you don't pay any capital gains tax, stamp duty or income tax. On the other hand, losses cannot be offset for tax purposes. If you're not resident in the Republic of Ireland you'll have to check the tax implications of trading with your own financial advisor.
Your protection
"Client monies are segregated in accordance with the Financial Regulators’ Client Asset Requirements published in November 2007. Delta Index is a member of the Investor Compensation Company Limited under the Investor Compensation Act, 1998 (the "ICA"). The ICA provides for compensation (to the extent of 90% of an investor’s net loss as defined by the ICA or €20,000, whichever is the lesser) for clients of investment firms that are unable to return client monies and/or investment instruments belonging to clients."
Do you receive dividends?
Effectively, yes. In quarterly contracts where we anticipate a dividend, we apply a price adjustment for 80% of the anticipated dividend. This is based on historical evidence and is applied in the form of a discount to the calculated futures price. On the day the stock goes ex-dividend we remove this discount, which compensates our long clients for the dividend induced fall in the cash market. On the other side our short clients are penalised very slightly.
For example, BOI cash price is 1388-1393. The Delta Index quarterly futures price, in other words, the interest rate adjusted price is 1398-1410. 80% of the anticipated dividend is 26c, therefore the current Delta Index quarterly future would be 1372-1384.
For rolling bets, your account will be either credited or debited the requisite amount on the evening before the stock goes ex-dividend.
How is the spread determined?
Spreads are calculated as a percentage of the underlying price. The main factor affecting the percentage is the liquidity in the market. If there is a wide spread in the wholesale market where we place your trade, this will be reflected in the spread that we quote:
As a rule of thumb you can expect:
| UK shares: |
0.6 - 0.8% of price |
| US shares: |
0.7 - 0.8% of price |
| Irish shares: |
0.8 - 1.0% of price |
How do I work out the mid price?
BOI 1300 - 1310: The mid price is the centre between the buy and sell price which equals 1305.
If I look up a financial website or newspaper for a price, will Delta Index prices be the same? Why not?
Our prices differ from the corresponding cash price that you might see in the newspapers or television. This is because we quote a futures price which is a combination of the cash price and the cost of financing the position up to the expiry date. Dividends are also considered.
What is gapping?
A gap is a break between prices that occurs when the price of a contract makes a sharp move up or down with no trading in between. Gaps can be created by a number of factors including overnight news, earnings announcements, a change in an analyst's outlook or any other type of news release. Gapping can occur both on the up and downside.
What is the minimum opening deposit?
€1,000
Do I receive contract notes?
Yes, you receive these electronically when you trade and can print them out. You won't need them for taxation purposes, as all your profits are tax free.
How can I withdraw my funds?
By bank transfer; we wire your money directly into the account you specify on your application form. If you want to transfer to another account we need to get your written authorisation to put through the transaction. If any other personal details change, simply call us on 1850 88 20 20.
Is there a charge if I decide not to trade and withdraw my funds?
No.
How close can I put my stop loss?
This depends on the contract you are trading but approximately 20 points away from your open position. Be careful not to put your stop loss too close as the ‘noise’ of the markets could trigger your stop and close you out of the position.
How does it work if I don't want a stop loss?
The account can be set up without automatic stop losses. A stop loss can be attached to an individual trade anytime the client wishes.
Can I move a stop loss if the market is closed?
You can change a stop loss or a limit order on the phone from 7.00am - to 9.15pm or online.
Do I receive a call/email if markets are going to expire to check if I want to roll over?
Delta Index attempts to contact the client either by email or phone to notify them that the contract is expiring and that they can rollover into the next contract if desired. However, we may not be able to contact each client and it remains the client’s responsibility to contact the dealing desk if they wish to rollover their positions.