Whatever your view, the Spread Bet brokers offer their clients a way to eliminate slippage once and for all, in the form of what's called a guaranteed stop loss or, as some Spread Betting companies call it, a controlled risk spread bet.

In the FTSE the cots if about 2-4 points and with shares anywhere from 0.3% - 0.75% of the size of the deal and believe me those costs, whereas they look relatively small, are a massive handicap to pay.

Don't believe anyone who tells you that guaranteed stop losses are not that much and are worth the cost. Either those people have an interest in selling them or they don't know what they're talking about.

As I have indicated many times on this site, the cost of doing business is an incredibly important factor to pulling profits out of the markets overtime, and it's not all about buying and selling at the right prices, although that helps! So ignore costs at your peril.

• See Secret 3 - The cost of doing business - It's more important than you think - which is one of our 10 Secrets to Successful Spread Betting

If there's one group of traders who know the important and dominant role that costs play when trading and investing it's the professional traders. So you won't find them using guaranteed stops and that speaks volumes.

The professionals will probably approach the markets like this -

Never discount the power of scare marketing, we witness it all the time.

For example, the Vitamin industry regularly uses it - if you don't take your daily vitamins then there's a high chance you'll be in poor health and die early etc. OK, I'm elaborating somewhat but you get the point.

And scare marketing is probably used to push guaranteed stops as well focusing on the fact it's possible to lose more than you expected if some major news/event hits the markets. That may be true but it's not going to happen as much as perhaps they suggest.

Just because they're expensive and bad value doesn't mean we as responsible traders shouldn't use them. I for example would defiantly consider using them in certain situations, such as -

• If I were to trade an unusually large position - If my trading size in the FTSE is traditionally in the £2 - £7 a point range and I take a position of £30 a point or more that's a lot of risk should the market move quickly against me. So a guaranteed stop loss is worth considering
  
  
• When the markets are exceptionally volatile - Slippage is a way of life for the trader and it's no problem if relatively small. But slippage can be a major problem when the markets are exceptionally volatile, so again I would consider using a guaranteed stop

They're often heavily marketed to new traders whereas professionals hardly if ever use them, and that should tell you everything you need to know.

So don't be scared about slippage it's not really a problem unless the markets get super volatile. My advice - just use regular stop losses.

• See Secret 5 - Always use a Stop Loss - One day they'll save your (financial) life - which is one of our 10 Secrets to Successful Spread Betting