I’m looking at Garmin, daily spread is 3993-4004, march is 3992 – 4020. assuming I am holding for say 2 months. which is better to go for, and how do I work it out etc…
The narrower spread on the Daily Funded Bets (DFB’s) obviously makes them a better choice if only expecting to hold them for a few days – but I wanted to know the cut-off period beyond which it might have been better to take the bigger quarterly spread, rather than incur too many overnight charges by holding a DFB longer than first planned. The advice I got from IG Index, which tallied with my own assessment of the charging structure, was that the charging curves crossed somewhere around 15-17 days. Below that it is worth using DFBs, but if wanting the freedom to hold a position for longer, it can be worth paying the quarterly spread instead.
It varies though – and at times the market spread on particular instruments might be temporarily wider or narrower – and that needs to be taken into account when making the comparison.
P.S.: Earlier this year I did try splitting a £20pp bet into two £10pp bets on the same stock at the same time, and closing at the same time. I did the same with another stock splitting a £10pp bet into two £5pp bets opened at the same time, over a different timespan, and the outcomes seemed to tally with the above.