What are the Spread Betting Advantages?

Bull or Bear
One of the most obvious advantages of spread betting is the unique opportunity to go short of (or sell) a stock or share. You can therefore experience the benefit of either a rising or falling market!


Gearing
Spread betting also allows you to trade in sizes smaller than those usually available in the underlying market. Similarly, you may also benefit from an opportunity to trade in larger positions than are normally permitted in the underlying market, without depositing large sums of money.

Tax Free Profits
All spread betting profits are recognised as the winnings of a bet, and are therefore free of Capital Gains and Income Tax.

Tight Spreads
At Capital Spreads our mission is to provide value for money plus top quality service. You’ll find our spread quotes far better value that most of our competitors. In some cases, you will find that our spreads are extremely competitive in relation to the live, underlying market quotes.

For example, our Daily Rolling FTSE spread is just 2 points and our Daily Rolling Sterling/Dollar quote is just 4 points. Compare our spreads to that of our competitors

Limit your Risk
Spread Betting is a high-risk activity. The automated stop-loss facility we provide is an invaluable tool, which encourages you to understand and control your risk. Although you must be aware that stop losses are not guaranteed.

Your stop-loss is set according to the funds available on your account up to a maximum computer-generated level. You can amend your stop-loss to suit your needs.

Risks
Although you can make substantial profits from spread betting, if the markets move against your bet, your loses can also be substantial and although Capital Spreads has a policy of attempting to limit client losses on bets by applying an automatic stop–loss to each bet you make, these stops are not guaranteed. As a consequence, if a market gaps, you may lose more than your initial deposit.

Spread Betting?

Spread betting is any of various types of wagering on the outcome of an event, where the pay-off is based on the accuracy of the wager, rather than a simple "win or lose" outcome, which is known as fixed-odds or money-line betting.

A spread is a range of outcomes, and the bet is whether the outcome will be above or below the spread. Spread betting has been a major growth market in the UK in recent years, with the number of gamblers heading towards one million.

Spread betting carries a high level of risk, with potential losses or gains far in excess of the original money wagered. In the UK, spread betting is regulated by the Financial Services Authority rather than the Gambling Commission.

Spread betting is a tax free cost effective alternative to traditional share trading. It allows you to speculate on the movement of stocks and shares without using a stockbroker, therefore you do not have to pay commission or fees. We make a spread around the live, underlying market price and you can bet on whether this market will rise or fall.

Betting on the movement of stocks and shares allows our customers the opportunity to generate substantial profits on both rising and falling markets. Spread betting therefore offers all the advantages of speculating on the stock markets and much more.

Article source: Wikipedia, the free encyclopedia.