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Please note: JNF Capital is no longer trading. If you are looking for an advisory broker, feel free to check out our regulated and highly respected list of brokers here.

Advisory trading is a growing niche within the contracts for difference (CFD) market, but no firms had yet ventured into financial spread betting until JNF Capital (formerly JN Financial) launched its service. The Armchair Trader spoke with Nathan Eisenberg about why some traders like the advisory approach to spread betting.

The Armchair Trader [AT]: Can you tell us a little bit about advisory spread betting?

Nathan Eisenberg [NE]: JNF Capital is licensed to provide advice to our customers on the bets they are taking. This is more common in the CFD market, but we believe we’re the only firm currently offering advisory services on financial spread betting. It means we can provide our customers with advice on the trades they are making. We are not a money management firm, the customer still has the final say on the trade he makes. But we can provide more advice than the execution-only service most spread betting companies offer. We have been offering advice on CFD trades for several years now, but many customers like the tax-free benefits of spread betting in the UK, so it seemed a natural progression to offer this too.

AT: What sort of markets do you advise on?

NE: The demand from our clients is very much for advice on equities-based trades, particularly blue chips, but also some small caps and AIM-listed stocks. We have also started advising on core commodities markets, like gold, and on the VIX index. All bets are routed through the ETX Capital platform.

AT: How much contact do you have with clients?

NE: It really depends on the customer. Some of our advisors will speak with the same client several times a day. The service can be tailored to the schedule of the individual.

AT: What is the minimum amount required to open an account with JNF Capital?

NE: This will really depend on the client. We like to conduct a thorough financial review to see just how much risk an individual is taking on. This is based on their liquid assets, and excludes investments like property. We consider it essential that traders can afford to take on the risks involved in serious spread betting. Based on this, we can identify the maximum downside they can afford in their day to day trading activity and a maximum we recommend for them to fund.

AT: Do you advise beginners?

NE: The majority of our clients – say three quarters – have trading experience already. Some will have had a bad experience going it alone, and are really looking to continue with the help of a market professional. I think they appreciate having a second opinion on the trades they are considering. Obviously, we offer additional support in the form of research and online seminars if clients want to take advantage of that.

AT: Given that ETX Capital is taking the trades, where is the money held?

NE: All client funds are held with ETX Capital and are segregated. In addition, they will be covered by the UK Financial Services Compensation Scheme.

AT: What sort of fees do you charge for this service?

NE: Fees are levied on the basis of 0.5% of the leveraged amount.

 

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Please note this article does not constitute investment advice. Investors are encouraged to do their own research beforehand or consult a professional advisor.

Stuart Fieldhouse

Stuart Fieldhouse

Stuart Fieldhouse has spent 25 years in journalism and marketing, including as a wealth management editor for the Financial Times group, covering capital markets and international private banking, and as an investment banking correspondent for Euromoney in Hong Kong. He was the founder editor of The Hedge Fund Journal.

Stuart has worked at CMC Markets, supporting the re-launch of its global financial spread betting and CFD trading platforms. He is also the author of two books on trading, published by Financial Times Pearson. Based in The Armchair Trader’s London office, Stuart continues to advise fund managers, private banks, family offices and other financial institutions.

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