Spread Betting - Introduction

Spread betting is a combination of investing, trading, and betting. Spread bets are available in a variety of financial markets. These markets include stocks, bonds, indices, and commodities.

A spread bet is essentially that a spread of two numbers of an index. These numbers go from low to high and reflect market value. It is up to a trader to speculate if the price will go up or down.

If one thinks it will rise one buys the high number, called go long. Sell the low number if thinks price will decrease called go short.

To calculate betting profits two numbers are used in the process. The difference of the buy or sell point to the ending value and wager. These two numbers are multiplied to find the trader’s profits.

However, if the market went in the other way these would be losses. The losses are calculated in the same way as profits are found. The greater the difference in bet value influences the amount lost.

Spread Betting Market

In traditional investing, individuals purchase shares of something. Share holders can only make money if the market price increases. Stock shares purchased must be paid for at the time of purchase.

In spread betting, nothing is owned and one can put up a percentage. This percentage is a portion of the initial wager of a bet. This can be risky so be sure not to overextend oneself financially.

Last, spread bettors can make earnings in a declining market. This happens if the bettor chooses the direction the market moves. This means a trader can make money even in poor economic times.

UK Spread Betting Companies

Spread betting companies have been around for about thirty years. These betting companies offer spreads to people and investors. Additionally, many offer seminars to educate and inform traders.

Software has even been developed to assist people in getting started. Spread betting companies can set up stop losses to limit the losses. Spread bets can be closed at any time or run until expiry dates.

Spread betting has a big advantage over traditional investing. Spread bet earnings are exempt from stamp duty and capital gains tax. Another advantage is traders do not have to monitor the market.

Many spread betting companies have markets available 24 hours a day. These markets are opened even after the traditional market closes.

In essence, spread betting is the 21st century form of investing. It allows trading for all people instead of those with a lot of money.

Share and Enjoy :

Sign Up With Us Today

Sign up with our system that aims to make 160%* per year & take advantage of our proven spread betting system.

Comments & Ratings