Compare Spread Betting Accounts

The high demand for spread betting has increased the number of spread betting companies who offer spreads and hold accounts for clients. This demand has forced the spread betting companies to become highly competitive in regards to the services they provide for account holders. Generally, spread betting accounts are very similar and the differences which do exist are minute.

When comparing spread betting accounts, the criteria one should look for pertains to what kind of accounts are available. Spread betting firms offer cash or credit accounts. Cash accounts must have enough capital in them to cover all bets and must be settled upon a loss. Credit accounts allow bettors to make bets based on credit history, but may also require the account holder to have an account minimum or have proof of other liquid assets. IG Index offers both credit and cash accounts whilst Capital Spreads currently only offers cash accounts to new account holders. In order to qualify for an IG Index credit account, proof of £5000 must be demonstrated.

A demo account is something else to consider when comparing spread betting accounts and is especially important for new traders. A demo account is an account which traders may use to make trades on the markets without risking any real capital. This type of account provides practice for the trader whilst one learns how to manoeuvre within the trading platform. The demand for demo accounts has increased so more companies are offering demo accounts. Fin Spreads offers a demo account, but Shorts and Longs does not.

Minimum trade size should be evaluated when comparing spread betting accounts. Most spread betting companies require the minimum trade to be £1 or in some cases even less. As a new spread bettor a minimum wager of £1 is acceptable and reasonable. A few companies, such as Pro Spreads and Barclays, have minimum wagers of £3 which is somewhat high for novice traders. The last thing a trader wants to do is overextend one's capital on the first few trades.

One last thing to consider when comparing spread betting accounts is the stop loss feature. Most spread betting firms offer the stop loss feature on all accounts where the trader indicates the total amount one is willing to lose on a trade. Once this limit is reached, the bet stops and is closed out. However, a stop loss might result from slippage meaning the time it takes to close the bet could result in a little more being lost than the limit loss stipulated by the trader. A guaranteed stop loss works in the same fashion as a stop loss, but with no slippage and therefore the loss limit is guaranteed.

Comparing spread betting accounts is an important step in spread betting because these accounts have basic features a spread bettor needs. Therefore, it is important to take the time to review what each firm offers prior to opening an account.

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