Financial spread betting is a form of investment that lets you trade on assets you do not own. For example, you could spread bet on markets like the FTSE 100 going up or down in value.

It is also a leveraged investment, which means you only need to put down a small percentage of the actual trade value you make.

How to start spread betting

You need to open a spread betting account and add money to it to get started.

Your broker's platform will give you a range of assets you can spread bet on, and when you are ready to make a trade you will be given the margin required.

The margin is how much you need in reserve before you can place your trade. This covers any potential losses you could make.

How to find the best financial spread betting company

To help you find the best financial spread betting company online, you need to look at:

  • The size of the spread: This tells you how much a market needs to move before you break even.

  • The margin amount: This is how much you need in your account before you place your spread bet.

This comparison shows the spread offered by each company for indices like the FTSE 100 and Wall Street, as well as pounds/US dollars and euro/US dollar forex pairs.

To improve your chance of making a profit, compare brokers to find the smallest spread.

How does spread betting work?

When you make a spread bet, you are given two prices:

  • The buy price

  • The sell price

The spread is the difference between the buy and sell price.

The bigger the spread, the more the market needs to move in your favour before you can break even or start to make a profit.

What are pips and points?

Depending on the market, the spread could be measured in:

  • Pips: Used only for forex pairs

  • Points: Used for any other type of financial market

Although they have different names, they both represent one price movement - either as an increase or decrease in the market price.

If you are new to spread betting, you could start with a beginners account or practice on a demo platform first.

Financial spread betting companies FAQs

Q

Do financial spread betting companies charge fees?

A

Some may charge for cash withdrawals or for leaving your account inactive for over a year. Check each company's terms before opening an account.

Q

Do I pay tax when financial spread betting?

A

No, any profits you make are not liable for Income Tax, Capital Gains Tax or Stamp Duty.

Q

How much do I need to open a spread betting account?

A

Most accounts are free to open, but you need to deposit a minimum amount to begin spread betting, such as 100. Check the terms before you apply.

Q

Is financial spread betting regulated?

A

Yes, all UK based spread betting companies are regulated by the Financial Conduct Authority.

Q

Is spread betting gambling?

A

No, the FCA does not consider spread betting to be a form of gambling, instead it is seen as a type of investment trading.

About our financial spread betting companies comparison

Q

Who do we include in this comparison?

A

We include spread betting accounts from our panel. They are either authorised and regulated by the Financial Conduct Authority (FCA), or a European regulator and listed on the FCA register as EEA authorised.

Here is more information about how our website works.

Q

How do we make money from our comparison?

A

We have commercial agreements with some of the companies in this comparison and get paid commission if we help you take out one of their products or services. Find out more here.

You do not pay any extra and the deal you get is not affected.