Financial Spread Betting

Posted on 13. Apr, 2010 by Global in Uncategorized

I want to briefly run through some of the advantages of financial spread betting. As with anything though there are always some disadvantages.

Ok so the first advantage of financial spread betting is that you don’t have to pay tax. Tax can take a large chunk of your money if you are making a lot of profits. With financial spread betting you don’t have to pay tax on any profits that you make, no matter how big they are.

That being said, you you aren’t making profits then this isn’t such a great advantage. Then you will not be able to offset any other losses. And specifically in financial spread betting because of its leverage, if you do make losses and you don’t protect yourself well enough, the losses could be substantial.

The other great advantage of financial spread betting is that it is so easy to learn and it is very easy to short trade shares (or any other asset for that matter). This is a really useful feature as it is as easy to short as it is to go long. This gives you full flexibility in any market.

There are lots of different markets for you to choose from as well. You don’t have to worry about being restricted to one area. This means that you can diversify and benefit from lots of different market movements.

When you are financial spread betting a foreign instruments you don’t have to worry about currency risk. Say I bet £1 per point on Coca Cola. The bet will weither lose or make £1 per on the movement of the asset and it doesn’t matter what happens in respect of sterling and the dollar in the mean time.

This is really useful because you can fully concentrate on the underlying assets and not have to worry about the direction of the currency.

As already mentioned trading is risky so make sure you read all the available financial spread betting information beforehand.

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