Spread Betting What is it?
Well in the simplest of terms, it’s playing the market based on a hunch! So yeah, it’s not for old people and anyone with a heart condition. The hunches need to be ridiculously accurate, that’s what makes it so exhilarating for thrill seekers, and quite risky for, well, everyone else. The fact is, Spread betting can be quite the pay off, or it can just as easily ruin you. Therefore, it’s crucial to know what it is, be extremely smart, or cheat. Say you’re sitting somewhere eating pie, and you have this burning hunch that the dollar will hit an all time low, or that the London session will be overtaken by the Tokyo session, and you have the cash to back it up-then if your hunch checks out, you’ll make some cold, hard cash, quick and easy!
From the house market, to the stock market, spread betting allows you to speculate on the fluctuation of asset values on the market. This speculation, if accurate, can make you really rich, really fast. That is essentially how spread betting works. The best part of it is, you don’t physically have to put money on it. You just take an initial position as to where you perceive the market to be heading, either up or down. The plan is not to get excited and start guessing, it may seem harmless enough, but so does a stray dog, until it bites you in the rear. Yeah so it’s tax free, that’s great, but you can lose money even faster than how you got it. The problem with spread betting is it’s enticing possibilities of large, tax free profits, but, there are losses as well, so caution becomes a rather useful skill at this point.
Spread betting works in a fairly simple way. For example if a stock value stands at say 2200, then the provider of the spread bet will offer you a buying (offer) price of around 2198, and a selling (2202). If you think that the value will rise you offer a figure, say $10/point as your bet. If this rise you anticipate is accurate by the end of business, then you get $10 per point that the value goes up. So if it gets to around 2232, then by the end of the session, you’ll have made $100! The fact that you can win big from betting small has a ’cause and effect’ feature attached. An equal and opposite reaction will be caused by betting small, and losing big. For example if you bet on a value to lose, and it gains, then you lose the same $10/point you put up. So if you predicted a loss and put your bet at 2198, then it rose to say 2208, then you would be out $100! Then your screwed-Cause and effect.
So what are its advantages?
There are a lot of markets that someone would want to trade on, but the majority of people don’t have access to. Spread betting bridges that gap and gives you a large variety of stocks and bonds to play around with. It’s also an easy, cost effective way to trade, you know, until you lose all your money. Unlike stock brokering, in spread betting there are no trading fees that one needs to pay before trading, so it’s a good way to gamble. Oh, and it’s TAX FREE!
The beauty of spread betting is you have the luxury of following market trends, or just going with a hunch. So it’s all up to you. If it works, great, if it doesn’t well….
i’m sixteen, i live in connecticut, and yes, i’m gay. i like; someone who can put a smile on my face, crunch bars, taking pictures, my ipod, blackberrys, my macbook, designing, facebook, tweeting constantly, smoking, livin’ it up, partying, money, buffalo blasts, coach, new york city, getting butterflies, abercrombie&fitch, cologne, staying out late, sneaking out, the summer, mean girls, tumblr, eating, cash, newports, degrassi, jersey shore, & roadtrips.