Spread Betting the Forex Markets: An Expert Guide to Spread Betting the Foreign Exchange Markets [Paperback]

I like David Jones, but lets be clear, he's an analyst and educator, not a trader. Here is my take of the good, bad and ugly of Spread Betting the Forex Markets.

The Good.
A good coverage of general forex knowledge and theory required to trade, delivered with a clear writing style.

His section on the crucially important subject of risk management is very good with an easy to follow simplification of what can be a complex area.

The Bad.
David's non trading background is reflected in the lightweight section on Trading Strategies which is very much at beginner level: it is by no means an expert guide on the subject as suggested by the book's title. That said, as the author explains, many people do like to make this area more complicated than required for effective trading.

There is no section on trading psychology.

No bibliography or further reading to point the interested reader in the right direction if they wish to read further on any subject area.

A questionable style of trade entry which involves waiting for price retracement if the initial risk reward ratio is not acceptable. Remember that all trades which are destined to fail will retrace to an acceptable R:R ratio so using this method will doubtless increase the percentage of losing trades so you'd better have a high R:R ratio to account for this.

The Ugly.
The section on overnight rollover financing of positions is fundamentally flawed which is surprising as David is an educator and should have nailed this subject with ease. The author explains that overnight financing is based on the interest rate of the currency in which you are long plus an overnight financing charge. Whilst different brokers or spread betting companies have different policies, the general concept of overnight spot FX financing involves the interest rate DIFFERENTIAL between the two currencies concerned which is reflected in the rollover debit or credit applied to the trading position. David's explanation is simply incorrect which is quite inexcusable in a book focused entirely on FX trading. It seems he has erroneously applied the financing method of stocks to FX.

On page 122 he shows a trading example in USD/JPY with the decimal place incorrectly placed throughout so rather than a price of 96.90 the author shows 0.9690 - this error is glaringly obvious and should have been picked up. Other USD/JPY examples in the book are correctly priced.

Conclusion.
Overall I can't help but think this book has been published as a quick money spinner in an area of growing interest. With a little more time and content the book could have been so much better. That said, it is certainly worth its money when compared with many of its competitors. The section on risk makes the purchase worthwhile on its own.

I feel we'll see more of David Jones as an author and I'd bet any future offering will be an even more worthwhile read than his generally competent and very readable first offering.

I have read many books on this subject and have been trading profitably nearly every day since the beginning of this year. This book is written in a very clear way, using good examples to make the key points come alive for the reader. It is easy to read and to grasp the messages and I was able to use something that I learned straight away to good effect.

For me, the key benefits of this book are:
- the clear explanations of how the forex markets and spread betting work
- how to calculate entry/exit points together with an appropriate and profitable risk reward ratio
- understanding how intraday positions are rolled over and the inherent costs of a roll over which could affect the overall profitability of a trade if held too long.
- use simpler momentum indicators - I think I was using too many which made it hard to understand what they were telling me.

I recommend this book to anyone who has not traded forex before and anyone who has traded but is not happy with the results they are achieving. If the latter group of people approach this book with an open mind they will, I am sure, get insight into how they can improve their performance. If their minds are not open then that could be the real problem.

I have been dabbling in forex trading for the last year approx. I have read book after book on the subject. The most frustrating thing is that these books seem to contradict each other and in some cases there are contradictions within the books themselves. You end up with an information overload (and a referral to another book :))

This books brilliance is its simplicity. It is clear concise and direct driving home all the important points David wants to get across. The chapter on risk management & chapters on support & resistance are excellent. After reading this book you have a basic simple approach to forex. - A strategic stop (based on support & resistance) a predefined entry point so you can wait for the market to come to you rather than vice versa)and a defined exit strategy based on risk management/ appetite.

In a nutshell Davids system takes the emotion out of trading which has been the downfall of most traders along with poor risk management. I love this book and am currently reading it for the 5th time. I am trying to learn off by heart the chapters on risk management & support & resistance.

A must read!

My only criticism is not with this book at all but that David does not have any more books on the subject. Looking forward to the next one.

John