These are the most commonly asked questions about our Spread Trading service.

Spread Trading

What is Spread Trading?

Spread Trading allows you, an investor, to trade on the directional movement of the price of a financial instrument. You will have to indicate an amount you want to trade on each point movement. For each point movement that the price of the financial instrument moves in your favour, you make a profit. If the price of the financial instrument moves against you, you will make a loss.

When I trade Spreads, am I entitled to ownership of the underlying asset?

When you trade on the price of the financial instruments, you do not actually own the underlying asset. However, you are entitled to some of the benefits, such as dividends, rights issues etc, as if you were an owner of the underlying asset. The main difference is that you will not receive any voting rights on.

What are the Margin Requirements for Spread Trading?

For each of your open trades, GT247.com will require you to place a deposit known as ‘margin’. Because you do not have to pay the full amount of your trade size, Spread Trading allows you to increase the amount of exposure to a financial instrument through leverage. This means you can place a larger trade than if you traded using simply the funds you placed in your account. Leverage has the effect of magnifying the profits or losses on your trading capital. The maximum amount of leverage available to you varies with whatever you are trading.

What is a Margin Call?

A margin call occurs when there is insufficient funding in your account to cover your open trades with the necessary margin. This happens if your account valuation falls below the margin requirement.

How will I know if I am on Margin Call?

Your account balance will be negative. You will be emailed to inform you that you are on margin call. You will also receive a call from our Client Services team.

What must I do if I am on a margin call?

If you are on a margin call, you must top up your account with cash or close your open positions to reduce your margin requirement.

What happens if I don't top up my account when I am on margin call?

If you don't top up your account or reduce your open positions, one or more of your trades will be closed in order to bring the margin level in your account up to the required level for the remaining open trades.

How do I make profits and losses through Spread Trading?

There are two main ways in which you can profit from Spread Trading:

• Buy at one price then sell at a higher price
• Sell at one price then buy at a lower price

• Buy at one price then sell at a lower price
• Sell at one price then buy at a higher price

What is the difference between Spreads and CFDs?

When you trade Spreads you have a set close date which cannot be changed unless you roll the trade. With CFDs however, you choose when to close your position.

You do not pay commission on Spread Trading but you do with CFDs. With Spread Trading the commission is priced into the spread.

If you hold a long position trading CFDs you will receive a proportion of any dividends the underlying equity receives, however if you are on a short CFD you may be liable for a proportion of the dividend. With Spread Trading you are not liable to pay any dividends but neither will you receive any dividend adjustments.

What is the difference between Spreads and Single Stock Futures (SSFs)?

Spreads are not traded on the local SAFEX market; you do not pay SAFEX related fees. The roll over and expiry work the same on Spreads as they would when trading SSFs.

When trading Spreads you are only required to place initial margin whereas when trading SSFs you will incur variation margin on a daily basis.

Other benefits when trading Spreads over SSFs, include: No dealer intervention when trading on our Spread Trading platform, Live derived real time pricing and live charts, automated trading & risk management.

Trading Hours

Can I trade Spreads outside of normal market hours?

This is not possible on South African equity instruments. International instruments can be traded for longer hours i.e. Wall Street 30 will trade from 02:16 to 22:10. (in line with Daylight Savings). Refer to our for further information.

Account Opening

What is the minimum initial deposit required to open a Spread Trading account?
The initial deposit required to open a Spread Trading account is ZAR 5 000.

Do I earn interest on my funds?

Yes, Interest is paid on cash held in your trust account. The interest amount will vary depending on the size of the funds held. Interest is tiered and all client trust accounts are held at Investec Bank. Clients will not receive interest on funds in their margin account.

If I am trading in offshore markets is my profit and loss in the currency of that market, or ZAR?
All P&L is calculated in South African Rand (ZAR) regardless of you are trading.

Can I trade offshore products and do I need offshore funds?

Yes. You can trade offshore products; these include bonds, commodities, currencies and international indices. You do not need offshore funds to facilitate trading in these instruments as they are tradable in South African Rand (ZAR) without any offshore exposure.

Trading Platform

What is Future Trader?

Future Trader is GT247.com’s in-house trading platform for trading Spreads (OTC futures), Mini CFDs and Binary Options.

Do I need a computer in order to trade?

No, you do not need a computer in order to trade. GT247.com has a dedicated trading desk. You can also call our dealers, who will be able to place trades for you over the telephone on your instructions.

Do I have to pay to use Future Trader?

You do not have to pay to use the trading platform. You will be able to access the platform free of charge once you open an account with us.

Troubleshooting

Is Future Trader secure?

Future Trader operates in a completely secure environment. We employ 128 bit SSL encryption, which is the most secure encryption available today.

I have just purchased a new computer or have re-installed the operating system on my computer; will I lose all my trade history?

No. All your account history is securely stored on our server allowing you to log in from any location without losing any information.

Why do I get the ‘Unable to Launch Error’?

In most cases, you experience this error after updating the Java Runtime Environment (JRE) without first removing the older version. Having conflicting versions of the JRE on your computer at the same time may cause Java dependant applications to malfunction.

Why do I get ‘Connection Failure’ error on my platform?

This is most probably due to loss of an Internet connection. The platform is designed to reconnect automatically after the connection is lost. After six consecutive attempts, the platform will log you out.

Why do I get the error “Your Version (1.2.8.x) of application is out of date” ?

Some Java versions do not update on the temporary files when downloading the platform. To fix this you will have to clear your Java cache and re-launch the application from the GT247.com website.

After I enter my credentials “Loading Live Client application” or “Loading User Profile” message appears and Disappears but no platform. Why?

In most cases this is causes by a bad or extremely connection. The platform is designed to load within a certain amount of time and if this time elapses before the platform is downloaded, it disappears

Prices

Are all your prices live?

Yes, GT247.com prices are all real time, derived prices, with the exception of the "high" and "low" price, this price updates every 30 minutes.

Why are the Spread prices different to the exchange prices?

Spreads prices are derived from the underlying exchanges, incorporating GT247.com’s costs within the bid/offer spread. i.e. the price you trade at incorporates GT247.com’s costs. On South African equities we keep our futures calculation in line with the South African futures exchange (SAFEX).

Trading

How do I switch my platform from Simulated currency to my Live ZAR account, once my account is activated?

Once logged into the platform you will need to select 'Trading Currency' at the top left hand side of the screen. This will allow you to choose between 'ZAR - Real Trading' and 'GTC - Simulated Trading'.

Do I have the option to continue simulated trading once my live account has been activated?

Yes, You will continue having access to your simulated trading account. Simulated and Live trading accounts are under one profile and can be found under 'Trading Currency'.

Are there minimum/maximum trade sizes?

The minimum trade size is R1 per point with the maximum trade size varying per product. This information is available in the .

NB. If the maximum risk per instrument is R1000, clients cannot place one trade for the full value, they are able to do so by executing 4 trades of R250pp, alternatively clients can contact the trading desk to facilitate larger Rand pp trades.

What is the difference between a trade & order?

An order is placed above or below the current market price. The order will only be filled (done) when the market price trades to the order price. A trade is filled (done) immediately based on current market sell and buy prices.

Can I trade long (buy) and short (sell)?

Yes. You can trade long and short on all Spreads. Although certain products i.e. SA equities may occasionally be "Open, not shortable" due to liquidity and stock borrowing requirements.

Can I extend the life of my trade?

Yes. All trades can be rolled over into another contract period. A rollover consists of closing and settling the original trade, while simultaneously opening a new trade in the next contract at a reduced spread. You need to place your rollover instruction before the relevant last day of trading.

Can I amend orders when the market is closed?

Yes, you are able to amend existing orders out of market hours, but you cannot amend stop loss orders. You can amend an order online or over the telephone.

What are Stop Losses and Guaranteed Stop Losses?

A Stop Loss order allows you to set a price which if reached will automatically trigger a sell order (for long positions) or buy order (for short positions) to close your current position. A Guaranteed Stop Loss is, as it suggests, guaranteed to be executed at the price you specify even if the underlying share never actually deals at the price you specify due to a sudden price movement. There is an additional charge for Guaranteed Stop losses.

Why is there no guaranteed Loss on South African Equities?

The South African equity market trades from 09:00 to 17:00. While the SA equity market is closed the American and Asian markets are trading, big movements on these two markets can drastically affect share prices on the Johannesburg Stock Exchange (JSE). Therefore NO broker will offer the guaranteed stop loss facility on SA equities.

What happens to my stops when the product status is ‘Phone to trade’ and the underlying market is open?

All stops, Take Profits and orders will be honoured should the instrument be Phone to Trade whilst the actual market is open.

If I have a long (buy) position and do a separate short (sell) trade, would this close out my long position and vice versa?

No, You can have both a long and a short trade simultaneously. The trades will be shown separately in your "Open Transactions" window. In order to close an open trade you must click on the open trade in the "Open Trade" tab and then click "close trade", whereby the trade dialogue box will appear.

Can I trade on contracts any further out than the months shown on the platform i.e. if the current contract month is Sep. is it possible for me to trade the Dec. contract, if not, why?

No, You will only be able to trade in the current contract offered by GT247.com, due to the lack of liquidity on the underlying futures exchange.

What is the Daily contract e.g. Wall Street 30 (Daily)?

The daily contract expires at the end of every trading day. If you had an open trade on the Wall Street 30 (Daily) a trader will manually close out this position five minutes prior to GT247.com's closing time.

Can I execute trades by email?

No, GT247.com can only accept instructions via the telephone or online.

Why would my trade be declined?

The most common reason for declining a trade is a lack of funds on an account. The degree of risk in any tarde is reflected in a Minimum Margin Requirement for each product. The risk per point you have requested is multiplied by the margin requirement and the result then compared to your available trading resources. If the total margin requirement is greater than your available balance your bet will be declined.

My trade was accepted. What happens now?

Once you have successfully placed a trade, a confirmation will appear immediately in the Information window. Simultaneously, your new position will appear in the Open Transaction window.

The profit and loss for this trade will update in real time. This is the actual P&L that will be realized if you were to close the position at the current buy or sell price.

If I have placed a trade online, am I able to close this off on the phone?

Yes. Future Trader is fully integrated with our trading desk and back office system. You can call the trading desk to open or close any positions and use either medium to place further trades or orders.

General Trading

What is a derivative product?

A derivative product derives its value/price from its underlying asset. The underlying asset can be a share, an index, a currency pair or commodity.

What does it mean to place a ‘long’ and ‘short’ trade?

A long trade is when you buy a financial instrument at one price with the aim to sell it later at a higher price. A short trade is one in which you sell a financial instrument with the aim to buy it back later at a lower price.

What is the Spread?

The spread, also known as "the buy / sell spread", is the difference between the prices at which you can buy and sell the product in which you want to trade.

Who is the counterparty to my transactions?

Spread Co is the counterparty to all transactions

What is Over-the-Counter (OTC) trading and how different is it compared to Exchange Trading?

Most stock exchanges operate on a matched bargain or order driven basis. When a buyer's buy meets a seller's sell or vice versa, the stock exchange's matching system will decide that a deal has been executed. In an Exchange traded environment, orders are often filled partially due to insufficient quantity availability.

In OTC trading, there is no centralised physical location. A market maker who is a firm or bank will quote both a buy and a sell price in financial instruments. A market maker is the counterparty to the trades of all the clients. Hence, the client's loss is the market-maker firm's profit and vice versa. In an OTC environment, orders are filled fully when the order price becomes the market price, irrespective of the quantity.

Compliance

Is GT247.com regulated?

Yes, GT247.com is regulated in South Africa by the Financial Services Board (FSB).

Who is the FSB?

The Financial Services Board (FSB) is the single regulatory body for the South African financial services industry. How is my money protected?

Your trading funds are segregated from GT247.com's money and will not be used by GT247.com in the course of its own business. The funds are held in a segregated client money trust account at an approved South African bank.