What is Spread Betting?
Spread betting is a very simple concept and it shares many similarities with conventional trading. You 'buy' an instrument if you think its price is set to rise, or 'sell' if you think it will fall. Spread Bet positions do not result in physical ownership of the underlying instruments.
As your position gives you exposure to the underlying markets, all price movements and relevant corporate actions (dividends, stock splits, buy backs), if applicable, will be reflected accordingly, however.
Benefits of Spread Betting with us
- Tax free winnings - all your profits are completely free from UK capital gains tax†
- No commissions. The only charge is our dealing spread
- Go long or short easily and profit from both rising and falling markets
- Versatility & flexibility - trade in fractions of a whole contract
- High leverage
- Trade a variety of products on one account, including indices, single equities, commodities, interest rates, bonds and FX
Please note that whilst we have listed the benefits above, we would also like to draw your attention to our risk warning below.
† Spread Betting is currently free from Capital Gains Tax (CGT) and there is no stamp duty. It should be noted that tax treatment depends on your individual circumstances and may be subject to change in the future.
Example Trade: Buying Tesco
It is now early September and our quote for Tesco is 413.79 / 414.81 pence. You think the share price is cheap and decide to buy £10/per point at 414.81 to open a position. Our intuitive deal ticket shows that your position is equivalent to 1,000 shares.
A few days later, Tesco announces a £1bn savings plan. The market welcomes the news and our quote for Tesco shares jumps to 424.34 / 425.44. You close your position by selling £10/point at 424.34.
You have just made a profit of £10 x (424.34 - 414.81) = £95.30, and it's completely tax free†.