Spread betting isn’t the same as owning shares, but it lets you speculate on changes in share prices, indices, currencies and other financial assets. Unlike traditional investing, there’s no major upfront outlay, and you can still make profits if prices or values fall.
With spread betting you make a profit, or a loss, based on the price of the asset when you opened the trade, and its price when you closed the trade.
Just like traditional investing, there are two prices for a spread bet – the offer (buy) price and the bid (sell) price. The difference between the two is called the spread. At Spread Co we try to keep our spreads among the lowest in the market. This means that less of your spread betting stake is eaten up by charges.
Spread Betting Explained by SpreadCo
markets and what affects them
investment capital, through leverage
When you open a spread betting position on a market, you are given a ‘buy’ and ‘sell’ price either side of the underlying market price – this is known as the spread. If you think the market will rise, you open your spread bet at the ‘buy’ price. If you think it will fall, you open at the ‘sell’ price.
Like all forms of investing you have to pay charges, that’s why it makes sense to trade with a company that offers competitive spread betting charges. There are four key charges you need to be aware of