Terms To Compare Spread Betting Markets

Financial spread betting is a way of trading in which you deal with financial instruments without holding them directly. It is in a way, a leveraged investment which allows spread bettors to take a stance on the prices offered by the provider and predict the movements in the coming time. You can take long and short positions on in a wide variety of financial markets including stock, commodities, fixed income products and currencies.

Indices

Unlike in stock trading where traders buy or sell stock of individual companies is usually done on indices more often compared to individual shares. Indices of markers are amongst the most traded instruments in financial and are also supposedly the best option for new traders looking to get a hang.

Currencies

Spread betting is also done on currency fluctuations. Individual spread bettors specialise in currency pairs and in foreign exchange markets. The risk is slightly higher because magnifies winnings and losses and forex markets by nature are far more volatile because of the wide variety of factors that can influence currencies.

Bonds and interest rates

Fixed income products like bonds along with various types of interest rates are also used in spread betting. However, these are more for the seasoned bettors and the novice traders usually don’t enter these markets.

Commodities

Spread betting initially started with bettors trading in gold. Now a wide range of other commodities, oil etc. also offer great opportunities for the bettors to try their luck out.

Spread betting as a tool

A lot of spread bettors use like a tool especially when they have a share portfolio. So the risks taken through involves hedging the existing share prices. If the share values are decreasing then you could bet against the share prices and make up for the loss.

Comparing spread betting strategies

Often the strategy that works for one spread bettor doesn’t work for another. So you will have to choose the right strategy that suits your style. For example, some spread bettors are risk averse and hence go for scalping which involves making small Financial Spread Betting and quick gains all through the day instead of high risk positions over weeks where funding itself could become very expensive.

Other spread bettors follow strategies such as following market trends or reversals wherein they are waiting for a particular event or indicator and take a quick position before the rest of the investors move in thereby leading the position and making a profit before the price adjustments take place.

Some spread bettors go for break out strategies where they are looking for indicators for a bullish or bearish market. This is when the prices are over their upper limits or below their lower limits over successive days. Spread bettors use this strategy along with stop loss to ensure that they don’t lose when the prices go above or below a certain limit against their predictions. Therefore, spread bettors have to compare and choose their markets as well as their strategies.

For more tips and compare spread betting of various spread betting providers and markets, you can visit spreadcompare.co.uk