Dividends and shorting index CFDs

[waz]

Lately I have been shorting index CFD's.
Which means I have also being paying dividends.

Now for share CFD's it is easy to find out how much the dividend will be and when it will go ex. However when you trade an index CFD, is there anyway of knowing how much dividends will be paid on a certain day? And actually working out the point value of the index?

At the moment Im relying on my broker and trusting that they are taking out the right amount. How do I know they are not cheating me?

I wish there was a handy tool/data store which says on this particular day, if you are short on this index, then at this time we will deduct 1.8234 pips for dividend payment.

Does anyone know where I can access this info?

 

[Krusty the Klown]

Having done a bit of index trading with CFD's myself, I use the principal of averaging, since I could not find the same info. If you can find it please post it here.

I use the AFR dividend yield series as an average per day relative to my position size as an expectation to calculate what to expect on a day to day basis.

Its not an exact method but allows me to ballpark the expense.

 

[jono1887]

Just google upcomming dividends

http://www.asx.com.au/products/cfds/types/equity/upcoming_dividends.htm

 

[skc]

Start an account with another broker and short the index and see what they deduct. If there are substantial differences then 1 of them is cheating you... or one of them is doing the numbers wrong and benefiting you.

 

[Wysiwyg]

Lately I have been shorting index CFD's.
Which means I have also being paying dividends.

Now for share CFD's it is easy to find out how much the dividend will be and when it will go ex. However when you trade an index CFD, is there anyway of knowing how much dividends will be paid on a certain day? And actually working out the point value of the index?

At the moment Im relying on my broker and trusting that they are taking out the right amount. How do I know they are not cheating me?

I wish there was a handy tool/data store which says on this particular day, if you are short on this index, then at this time we will deduct 1.8234 pips for dividend payment.

Does anyone know where I can access this info?

Just google upcomming dividends

http://www.asx.com.au/products/cfds/types/equity/upcoming_dividends.htm

Waz, if you do calculate how much is payable please post the results. I was whacked +$600 for a 2 day full short contract hold ASX 200. That was 25 points to make up the difference. Never held a short contract overnight again and never checked the numbers.

When trusting these mobs it will be interesting to see if the numbers are correct.

 

[waz]

The best I have found for the Au200 CFD is this:
http://www.igmarkets.com.au/cfd/the-week-ahead.html

As you can see for this week we have two ex dividend days which should wipe off 0.4 and 0.3 of the index. However this is just IGINDEX calculation, how do I know if they are rounding up or down??? How do I know if this is even the correct figure? I dont, I just gotta accept it.

Grrr, I want something official from the ASX and from every other exchange around the world.

I dont think its a good idea to just average out the dividends, i.e the index is on a 7% yield/number of trading days = daily dividend yield payout.

There are problems with that approach:
# Dividends are not paid every day
# Some days are very popular for dividends (i.e property trusts every 3 months on the exact same few days)
# The yield rate is constantly changing as companies announce their dividends and as the index changes


Maybe this can be my business idea, every Index CFD trader would love this sort of information.

Just another way that Index/CFD providers are making money from little items like this. It may appear like only a few dollars to you. but multiply that by their entire customer base, rounding up from 0.9 to 1 might make them many thousands per day. GRRRRRRR


PS> 25 points is massive Wysiwyg.
If we say the yiled is 10%, then if the au200 is 4600, that should only work out 460/260 (weekdays in a year) = 1.8 points per day on average

It is 260 weekdays ina year right???

 

[skc]

The best I have found for the Au200 CFD is this:
http://www.igmarkets.com.au/cfd/the-week-ahead.html

As you can see for this week we have two ex dividend days which should wipe off 0.4 and 0.3 of the index. However this is just IGINDEX calculation, how do I know if they are rounding up or down??? How do I know if this is even the correct figure? I dont, I just gotta accept it.

Grrr, I want something official from the ASX and from every other exchange around the world.

I dont think its a good idea to just average out the dividends, i.e the index is on a 7% yield/number of trading days = daily dividend yield payout.

There are problems with that approach:
# Dividends are not paid every day
# Some days are very popular for dividends (i.e property trusts every 3 months on the exact same few days)
# The yield rate is constantly changing as companies announce their dividends and as the index changes


Maybe this can be my business idea, every Index CFD trader would love this sort of information.

Just another way that Index/CFD providers are making money from little items like this. It may appear like only a few dollars to you. but multiply that by their entire customer base, rounding up from 0.9 to 1 might make them many thousands per day. GRRRRRRR


PS> 25 points is massive Wysiwyg.
If we say the yiled is 10%, then if the au200 is 4600, that should only work out 460/260 (weekdays in a year) = 1.8 points per day on average

It is 260 weekdays ina year right???

The calucation of average day is pointless... On 23 Dec last year all the property trusts / infrastructure trusts go ex-div and that was 10-12 points. Major ex-div dates are a fact of trading index CFDs.

There is probably one more official source - if you compare the the ASX200 index to the ASX200 accumulation index. You will have to read the fine prints to see if that's possible.

 

[luckystrike]

for which index - for the FTSE you can use reuters which give you the exact number on a day.