Best and cheapest way to short ETFs intraday

[Apester]

Hi. I'm looking to get ready to short aussie ETFs like STW, VAS and A200 mostly just for intraday asx exposure. The inverse ETFs BEAR or BBOZ don't fit the bill.

Are CFDs or options the only way to get short exposure to STW, VAS or A200 and what would be the mechanics and fees for doing it those ways?

I haven't done much short selling so it would be great to know the exact steps e.g. Buy CFD such as xxx on platform yyy after ASX open and sell before close. My feeling is the fees and snake oil of CFDs and options will make it prohibitively expensive but please let me know if I'm wrong. If shorting the underlying indices like XJO is the only cost effective way to do it, please point this out.

Thanks!

 

[InsvestoBoy]

Hi. I'm looking to get ready to short aussie ETFs like STW, VAS and A200 mostly just for intraday asx exposure. The inverse ETFs BEAR or BBOZ don't fit the bill.

Are CFDs or options the only way to get short exposure to STW, VAS or A200 and what would be the mechanics and fees for doing it those ways?

I haven't done much short selling so it would be great to know the exact steps e.g. Buy CFD such as xxx on platform yyy after ASX open and sell before close. My feeling is the fees and snake oil of CFDs and options will make it prohibitively expensive but please let me know if I'm wrong. If shorting the underlying indices like XJO is the only cost effective way to do it, please point this out.

Thanks!

Get an Interactive Brokers account and short the XJO futures (SPI).

 

[frugal.rock]

Get an Interactive Brokers account and short the XJO futures (SPI).

 

[So_Cynical]

XJO Options - IB account.

https://www.asx.com.au/documents/resources/index_options.pdf

 

[Apester]

Thanks for the replies. So by shorting the XJO futures you mean buy puts? Is trading CFD indices much more expensive in fees? (Would seem so to me and some counterparty risk and price fiddling)

If I buy options, do I have to pay the premium each day when I buy? Or do these trade just like shares and I buy at $1 in the morning and sell at $1.01 in the afternoon and only pay brokerage.

 

[InsvestoBoy]

Thanks for the replies. So by shorting the XJO futures you mean buy puts?

No, ignore options if you want the "best and cheapest way to short", especially intraday.

Just short the SPI.

Is trading CFD indices much more expensive in fees? (Would seem so to me and some counterparty risk and price fiddling)

Depends how you define fees. CFD brokers don't charge a commission but you eat it on the spread. If you're trading intraday the spread will set your overall expectancy at a large handicap.

 

[Apester]

No, ignore options if you want the "best and cheapest way to short", especially intraday.

Just short the SPI.



Depends how you define fees. CFD brokers don't charge a commission but you eat it on the spread. If you're trading intraday the spread will set your overall expectancy at a large handicap.

Great response. Thanks. Others have suggested IB as the cheapest for fees when shorting. Any rivals or alternatives?

 

[InsvestoBoy]

Great response. Thanks. Others have suggested IB as the cheapest for fees when shorting. Any rivals or alternatives?

I honestly don't even know any other brokers that will give access to SPI lol.

 

[Apester]

Are the ASX exchange traded CFDs launched in 2007 still around?

 

[So_Cynical]

Are the ASX exchange traded CFDs launched in 2007 still around?

No - reasonably sure they are history though i did find something from 2013.

 

[Apester]

Thanks for the replies. Summary of my research for future askers:

• Shorting ETFs in Australia can be done in a number of ways with options, futures or CFDs.
• These all force you away from the cheap and simple share brokers like Stake and Superhero into the arms of the sharks like Interactive Brokers, IG, CMC etc.
• There's pretty much no way a retail investor can short ETFs intraday without paying big fees/vicious spreads/margin rips.
• The few inverse ETFs like BBOZ or BEAR might work for you instead but they don't seem to behave as true shorts in the short term, maybe due to low liquidity.

 

[InsvestoBoy]

Thanks for the replies. Summary of my research for future askers:

• Shorting ETFs in Australia can be done in a number of ways with options, futures or CFDs.
• These all force you away from the cheap and simple share brokers like Stake and Superhero into the arms of the sharks like Interactive Brokers, IG, CMC etc.
• There's pretty much no way a retail investor can short ETFs intraday without paying big fees/vicious spreads/margin rips.
• The few inverse ETFs like BBOZ or BEAR might work for you instead but they don't seem to behave as true shorts in the short term, maybe due to low liquidity.

Interactive Brokers is a reputable futures, options, stock and FX broker with the best risk management that I have observed of any broker globally. It's an insult to group them with CFD shops like IG and CMC.

 

[Apester]

Interactive Brokers is a reputable futures, options, stock and FX broker with the best risk management that I have observed of any broker globally. It's an insult to group them with CFD shops like IG and CMC.

No offence intended. They all sell CFDs.

 

[Apester]

No offence intended. They all sell CFDs.

After doing some trading with Interactive Brokers I can confirm that their fees are extremely high. You have to make almost 1% before you break even on CFDs. I can't believe these operations are permitted in a country like Australia. They are a parody of serious investing and more like casinos where the house always win. Avoid. Avoid. Avoid.

 

[InsvestoBoy]

After doing some trading with Interactive Brokers I can confirm that their fees are extremely high. You have to make almost 1% before you break even on CFDs. I can't believe these operations are permitted in a country like Australia. They are a parody of serious investing and more like casinos where the house always win. Avoid. Avoid. Avoid.

???? this is nonsense.

SPI futs trade on the SFE with a 1 tick spread and 6 AUD commission for each trade. There is absolutely no cheaper or more transparent "intraday asx exposure" as you asked for your in your original post, anywhere in the world for a retail trader.

I dunno what you did, but whatever it was you're doing it wrong.