UK Spread Betting Guide
Financial spread betting allows you to speculate on price movements in shares, commodities, currencies and indices without owning the underlying asset. Popular among thrill-seeking speculators, it’s a great way to trade the markets and can be a highly profitable form of trading if you know what you’re doing.
Like all forms of UK spread betting guide, there are costs involved with spread betting, such as the spread (the difference between the buy and sell price), overnight financing charges and platform fees. These can eat into profits so it’s important to understand the mechanics of spread betting before you begin trading.
A key factor is your bet size, also known as stake. This determines how much you’ll make or lose for every point the market moves in your favour, and it’s an essential part of any spread betting strategy.
The Complete UK Spread Betting Guide: What You Need to Know
For example, if you think the FTSE 100 is going to rise, you can open a ‘long’ position by buying at the ‘buy’ price of the spread, which is currently 7.501. You then need the market to go above this level for your trade to be profitable. Spread bets are tax-efficient in the UK, meaning you’re exempt from stamp duty and capital gains tax*. However, tax treatment depends on individual circumstances and may differ in a jurisdiction other than the UK. *Spread bets and CFDs are not available to US citizens.
