The advantages of spread betting explained.
Spread betting can offer a number of advantages over conventional share dealing or fixed odds betting.
Advantages over share dealing / financial trading
- Access to markets that are normally restricted to registered brokers, such as foreign exchange trading.
- A single account gives you access to a range of markets, including shares, bonds, currencies, interest rates, indices, options and commodities.
- No Stamp Duty is payable (payable at 0.5% on traded shares)
- No Capital Gains Tax is payable on profits made.
- No direct commission or brokerage fees are payable.
- It is possible to profit from falling markets.
- Profits are theoretically limitless. The 'more right' you are, the more you will profit.
- You can 'deal' when traditional markets are closed.
- Small bets can be placed.
- Bets can be made partially on credit.
Advantages over fixed odds betting
- Some markets offer 'live betting' so bets can be closed before the end of the sporting event, enabling you to 'lock in' a profit regardless of the final result.
- The only tax due on spread betting is betting tax which is aborbed by the bookmaker.
- A 'stop loss' can be set to limit your liability.
- Some sporting events are better suited to a 'points' market rather than fixed odds.
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