Is Spread Betting for me?
Spread betting is for those who understand the risks associated with trading.
Spread betting shares a number of features with direct share trading. For example:
Also, like investing directly in shares, there’s no guarantee that you’ll make a profit.
There are also differences between spread betting and share trading and one of the key differences is that the deposit you need to put down to place your spread bet is far lower. As it’s a leveraged product, your capital outlay, or margin, is only a percentage of the full trade value.
However, you should always remember that your potential loss can be significantly more than the margin.
Spread betting vs buying shares
Most experts will tell you that buying shares is for longer term investing. If you invest in a fund that buys shares, such as an OEIC, the fund manager will usually recommend an investment term of five years or more. Spread betting is all about taking advantage of short-term investment opportunities. Instead of holding onto an asset for years, spread betting lets you make gains in days, hours or even minutes when markets are volatile.
Spread betting has a number of advantages over investing in shares:
Spread betting and other assets
Another advantage of spread betting is that it doesn’t limit your opportunities to company shares. You can trade on indices, currencies and commodities too. If you already have experience in these other markets, spread betting can give you access to tax-free profits1.
Coupled with the power and simplicity of our trading platforms, it’s the ideal way to trade these assets for traders with every level of experience.
Spread betting with Spread Co
When you spread bet with Spread Co you’ll also enjoy:
*For spread bets on the UK100 and US30 Index.
Tax laws can change and depend on individual circumstances, tax laws may differ in a jurisdiction other than the UK.