{"id":41572,"date":"2020-12-03T13:41:48","date_gmt":"2020-12-03T13:41:48","guid":{"rendered":"https:\/\/bornrealist.com\/?p=41572"},"modified":"2021-05-04T09:21:03","modified_gmt":"2021-05-04T09:21:03","slug":"what-is-spread-betting","status":"publish","type":"post","link":"https:\/\/bornrealist.com\/what-is-spread-betting\/","title":{"rendered":"What Is Spread Betting?"},"content":{"rendered":"<p><span style=\"font-weight: 400;\">Considered as a type of derivative trading, spread betting is a popular form of derivatives based trading that involves analyzing the future financial markets. With this trading, you place your bets based on the nature of the future financial market. Thus, your decision will be guided by the behavior of the future market. So, if you want to <\/span><span style=\"font-weight: 400;\">invest in spread betting<\/span><span style=\"font-weight: 400;\">, get the basics right. The following guide contains all things spread betting\u2014including the benefits and features.<\/span><\/p>\n<p><b>Introduction<\/b><\/p>\n<p><span style=\"font-weight: 400;\">Spread betting is a betting strategy that involves analyzing the future financial market price. This may include <a href=\"https:\/\/bornrealist.com\/what-is-risk-management-in-forex-trading\/\">forex<\/a>, indices, and shares. In the United Kingdom and Ireland, spreads betting is tax-free\u2014provided that the investor doesn\u2019t take the investor doesn\u2019t commit to owning the asset. However, if you are based outside the UK, the rules regarding spread betting may vary. They may also depend on the explicit prevailing circumstances.<\/span><\/p>\n<p><b>How Spread Betting Works<\/b><\/p>\n<p><span style=\"font-weight: 400;\">An investor should track the asset value so that he\/she can have a clear picture regarding the future market behavior. However, the owner is not allowed to make asset ownership. Here are a few things you should know about spread betting:<\/span><\/p>\n<p><span style=\"font-weight: 400;\">They include:<\/span><\/p>\n<ul>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">The short &amp; long spread trading<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Leverage<\/span><\/li>\n<\/ul>\n<p><b>Long, Short Spread Trading<\/b><\/p>\n<p><span style=\"font-weight: 400;\">Long trading is a situation where you place a trade because you anticipate that the price will increase in the future. This strategy is guided by a certain time frame. On the other hand, going short or simply shortening a market is placing your bets because you anticipate that the market price will decline in the future.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">The purpose of spread betting is to enable you to speculate the nature of the market in the future\u2014i.e. rise or fall. Consider a situation where the price is projected to decline. In this case, it\u2019s prudent to consider opening a spread and sell your trade at the underlying market.\u00a0 Here, the amount you lose or gain will be dependent on the correctness of your prediction. For instance, if the market price declines, you would profit from your spread bet. On the other hand, if the gold increase, you will make a loss in your position.<\/span><\/p>\n<p><b>Leverage<\/b><\/p>\n<p><span style=\"font-weight: 400;\">On the other hand, leverage is spread betting is designed to help you gain a good exposure when it comes to the full market. This is done based on a fraction or percentage of the current market cost.<\/span><\/p>\n<p><b>The Benefits<\/b><\/p>\n<p><span style=\"font-weight: 400;\">Leverage helps magnify profits and losses. This is because these two components are calculated based on the value of your position. They don\u2019t depend on the initial deposit you make. For better exposure management, it\u2019s important to have an <\/span><a href=\"https:\/\/tradingstrategyguides.com\/trading-risk-management-strategy\/\" rel=\"nofollow\"><span style=\"font-weight: 400;\">elaborate risk management strategy<\/span><\/a><span style=\"font-weight: 400;\">.<\/span><\/p>\n<p><b>Margin and Spread Betting<\/b><\/p>\n<p><span style=\"font-weight: 400;\">Spread betting involves putting down a certain small initial deposit. That\u2019s why experts refer to leveraging trading as trading on margin. Margin in spread betting is divided into two. They include:<\/span><\/p>\n<ul>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Deposit margin<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Maintenance margin<\/span><\/li>\n<\/ul>\n<p><b>Deposit Margin<\/b><\/p>\n<p><span style=\"font-weight: 400;\">The deposit margin is the initial finding that is needed for opening the position. This margin is usually quoted as a percentage of the total trade.<\/span><\/p>\n<p><b>Maintenance Margin<\/b><\/p>\n<p><span style=\"font-weight: 400;\">Maintenance margin refers to the extra funds that are needed when the position sinks into losses that aren\u2019t centered on the initial deposit. Here, you will receive a notification (also referred to as margin cell). This notification will allow you to add funds or watch your position as it closes down.<\/span><\/p>\n<p><b>Spread Betting Features<\/b><\/p>\n<p><a href=\"https:\/\/www.ig.com\/uk\/spread-betting\/benefits-of-spread-betting\" rel=\"nofollow\"><span style=\"font-weight: 400;\">Spread betting<\/span><\/a><span style=\"font-weight: 400;\"> enables you to predict the future market before investing your money. In spread betting, you minimize the risks of losing your money. Plus, it enables you to have better control over your trading activities. This trading strategy comes with 3 main features. They include:<\/span><\/p>\n<ul>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">The spread<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">The bet size<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">The bet duration<\/span><\/li>\n<\/ul>\n<p><span style=\"font-weight: 400;\">Below is a quick overview of these three main features.<\/span><\/p>\n<p><b>Define the Term Spread<\/b><\/p>\n<p><span style=\"font-weight: 400;\">Defined as the difference that exists between the buy and the current selling prices, the spread is usually wrapped around the current market price. In most cases, the spread is also referred to as the offer. It can also be known as the bid. Any given trade is usually factored in based on these 2 prices.<\/span><\/p>\n<p><b>Consider This Example<\/b><\/p>\n<p><span style=\"font-weight: 400;\">Consider an FTSE 100. If it trades at 5885.5. If the trade comes with a single point trade, the offer and bid prices will be 5886 and 5885 respectively.<\/span><\/p>\n<p><b>Bet Size<\/b><\/p>\n<p><span style=\"font-weight: 400;\">In simple terms, a bet size can be defined as the amount an investor bets per any unit movement of the current market price. You have the freedom to choose your explicit bet size. However, you should meet the requirement recognized by the company. To get a profit or loss, they will subtract the opening price from the closing price. They will then multiply the figure by the bet value.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">The price movements are measured to get the points in the underlying market. Here, a point of movement may denote a penny, hundreds of dollars, etc. Thus, it\u2019s important to understand what point means when it comes to the chosen market on your deal ticket.<\/span><\/p>\n<p><b>Consider This Example<\/b><\/p>\n<p><span style=\"font-weight: 400;\">Suppose you open a $3 per point. Assume that the FTSE is 1000 and it moves 70 points in the favor of the trader (i.e. you). The profit from this trade will be $120($3 x 70). On the other hand, if the points move against you, you will lose around $120. This is <a href=\"https:\/\/learnbonds.com\/uk\/spread-betting\">what is spread betting<\/a> is all about.<\/span><\/p>\n<p><b>Bet Duration<\/b><\/p>\n<p><span style=\"font-weight: 400;\">Any bet position should expire. In most cases, they should expire within a certain time frame\u2014also known as the bet duration. It\u2019s important to note that any spread bet should have a timescale, which is always fixed. This timescale can range from days to months. You are allowed to close your spread bet before the expiry date.<\/span><\/p>\n<p><b>The Bottom-Line<\/b><\/p>\n<p><span style=\"font-weight: 400;\">If you want to get the most out of <\/span><span style=\"font-weight: 400;\">spread betting<\/span><span style=\"font-weight: 400;\">, get the facts right.\u00a0 With spread betting, things like forex, indices, and shares can be easily predicted. The above guide will help you understand what\u2019s spread betting and how you can leverage it to make a lot of money.<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Considered as a type of derivative trading, spread betting is a popular form of derivatives based trading that involves analyzing the future financial markets. With this trading, you place your bets based on the nature of the future financial market. Thus, your decision will be guided by the behavior of the future market. So, if [&hellip;]<\/p>\n","protected":false},"author":10,"featured_media":34547,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1813],"tags":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v22.3 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>What Is Spread Betting? | Born Realist<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/bornrealist.com\/what-is-spread-betting\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"What Is Spread Betting? | Born Realist\" \/>\n<meta property=\"og:description\" content=\"Considered as a type of derivative trading, spread betting is a popular form of derivatives based trading that involves analyzing the future financial markets. With this trading, you place your bets based on the nature of the future financial market. Thus, your decision will be guided by the behavior of the future market. So, if [&hellip;]\" \/>\n<meta property=\"og:url\" content=\"https:\/\/bornrealist.com\/what-is-spread-betting\/\" \/>\n<meta property=\"og:site_name\" content=\"Born Realist\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/web.facebook.com\/DaBornRealist\/\" \/>\n<meta property=\"article:published_time\" content=\"2020-12-03T13:41:48+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2021-05-04T09:21:03+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/bornrealist.com\/wp-content\/uploads\/2018\/08\/iStock-880575498.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"724\" \/>\n\t<meta property=\"og:image:height\" content=\"483\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"Silver Crow\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:creator\" content=\"@DaBornRealist\" \/>\n<meta name=\"twitter:site\" content=\"@DaBornRealist\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Silver Crow\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"5 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\/\/bornrealist.com\/what-is-spread-betting\/#article\",\"isPartOf\":{\"@id\":\"https:\/\/bornrealist.com\/what-is-spread-betting\/\"},\"author\":{\"name\":\"Silver Crow\",\"@id\":\"https:\/\/bornrealist.com\/#\/schema\/person\/a052f43ac2ebe750c20e597aee6f52cd\"},\"headline\":\"What Is Spread Betting?\",\"datePublished\":\"2020-12-03T13:41:48+00:00\",\"dateModified\":\"2021-05-04T09:21:03+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\/\/bornrealist.com\/what-is-spread-betting\/\"},\"wordCount\":1021,\"publisher\":{\"@id\":\"https:\/\/bornrealist.com\/#organization\"},\"image\":{\"@id\":\"https:\/\/bornrealist.com\/what-is-spread-betting\/#primaryimage\"},\"thumbnailUrl\":\"https:\/\/bornrealist.com\/wp-content\/uploads\/2018\/08\/iStock-880575498.jpg\",\"articleSection\":[\"Crypto\"],\"inLanguage\":\"en-US\"},{\"@type\":\"WebPage\",\"@id\":\"https:\/\/bornrealist.com\/what-is-spread-betting\/\",\"url\":\"https:\/\/bornrealist.com\/what-is-spread-betting\/\",\"name\":\"What Is Spread Betting? | Born Realist\",\"isPartOf\":{\"@id\":\"https:\/\/bornrealist.com\/#website\"},\"primaryImageOfPage\":{\"@id\":\"https:\/\/bornrealist.com\/what-is-spread-betting\/#primaryimage\"},\"image\":{\"@id\":\"https:\/\/bornrealist.com\/what-is-spread-betting\/#primaryimage\"},\"thumbnailUrl\":\"https:\/\/bornrealist.com\/wp-content\/uploads\/2018\/08\/iStock-880575498.jpg\",\"datePublished\":\"2020-12-03T13:41:48+00:00\",\"dateModified\":\"2021-05-04T09:21:03+00:00\",\"breadcrumb\":{\"@id\":\"https:\/\/bornrealist.com\/what-is-spread-betting\/#breadcrumb\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\/\/bornrealist.com\/what-is-spread-betting\/\"]}]},{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/bornrealist.com\/what-is-spread-betting\/#primaryimage\",\"url\":\"https:\/\/bornrealist.com\/wp-content\/uploads\/2018\/08\/iStock-880575498.jpg\",\"contentUrl\":\"https:\/\/bornrealist.com\/wp-content\/uploads\/2018\/08\/iStock-880575498.jpg\",\"width\":724,\"height\":483},{\"@type\":\"BreadcrumbList\",\"@id\":\"https:\/\/bornrealist.com\/what-is-spread-betting\/#breadcrumb\",\"itemListElement\":[{\"@type\":\"ListItem\",\"position\":1,\"name\":\"Home\",\"item\":\"https:\/\/bornrealist.com\/\"},{\"@type\":\"ListItem\",\"position\":2,\"name\":\"What Is Spread Betting?\"}]},{\"@type\":\"WebSite\",\"@id\":\"https:\/\/bornrealist.com\/#website\",\"url\":\"https:\/\/bornrealist.com\/\",\"name\":\"Born Realist\",\"description\":\"Doers Not Dreamers\",\"publisher\":{\"@id\":\"https:\/\/bornrealist.com\/#organization\"},\"potentialAction\":[{\"@type\":\"SearchAction\",\"target\":{\"@type\":\"EntryPoint\",\"urlTemplate\":\"https:\/\/bornrealist.com\/?s={search_term_string}\"},\"query-input\":\"required name=search_term_string\"}],\"inLanguage\":\"en-US\"},{\"@type\":\"Organization\",\"@id\":\"https:\/\/bornrealist.com\/#organization\",\"name\":\"Born Realist\",\"url\":\"https:\/\/bornrealist.com\/\",\"logo\":{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/bornrealist.com\/#\/schema\/logo\/image\/\",\"url\":\"https:\/\/bornrealist.com\/wp-content\/uploads\/2017\/02\/new.png\",\"contentUrl\":\"https:\/\/bornrealist.com\/wp-content\/uploads\/2017\/02\/new.png\",\"width\":281,\"height\":65,\"caption\":\"Born Realist\"},\"image\":{\"@id\":\"https:\/\/bornrealist.com\/#\/schema\/logo\/image\/\"},\"sameAs\":[\"https:\/\/web.facebook.com\/DaBornRealist\/\",\"https:\/\/twitter.com\/DaBornRealist\",\"http:\/\/instagram.com\/bornrealist\",\"https:\/\/www.linkedin.com\/company\/born-realist\/\",\"https:\/\/www.pinterest.com\/bornrealist\/\"]},{\"@type\":\"Person\",\"@id\":\"https:\/\/bornrealist.com\/#\/schema\/person\/a052f43ac2ebe750c20e597aee6f52cd\",\"name\":\"Silver Crow\",\"description\":\"Aspiring writer and a very passionate problem solver\",\"url\":\"https:\/\/bornrealist.com\/author\/silvercrow\/\"}]}<\/script>\n<!-- \/ Yoast SEO plugin. -->","yoast_head_json":{"title":"What Is Spread Betting? | Born Realist","robots":{"index":"index","follow":"follow","max-snippet":"max-snippet:-1","max-image-preview":"max-image-preview:large","max-video-preview":"max-video-preview:-1"},"canonical":"https:\/\/bornrealist.com\/what-is-spread-betting\/","og_locale":"en_US","og_type":"article","og_title":"What Is Spread Betting? | Born Realist","og_description":"Considered as a type of derivative trading, spread betting is a popular form of derivatives based trading that involves analyzing the future financial markets. With this trading, you place your bets based on the nature of the future financial market. Thus, your decision will be guided by the behavior of the future market. So, if [&hellip;]","og_url":"https:\/\/bornrealist.com\/what-is-spread-betting\/","og_site_name":"Born Realist","article_publisher":"https:\/\/web.facebook.com\/DaBornRealist\/","article_published_time":"2020-12-03T13:41:48+00:00","article_modified_time":"2021-05-04T09:21:03+00:00","og_image":[{"width":724,"height":483,"url":"https:\/\/bornrealist.com\/wp-content\/uploads\/2018\/08\/iStock-880575498.jpg","type":"image\/jpeg"}],"author":"Silver Crow","twitter_card":"summary_large_image","twitter_creator":"@DaBornRealist","twitter_site":"@DaBornRealist","twitter_misc":{"Written by":"Silver Crow","Est. reading time":"5 minutes"},"schema":{"@context":"https:\/\/schema.org","@graph":[{"@type":"Article","@id":"https:\/\/bornrealist.com\/what-is-spread-betting\/#article","isPartOf":{"@id":"https:\/\/bornrealist.com\/what-is-spread-betting\/"},"author":{"name":"Silver Crow","@id":"https:\/\/bornrealist.com\/#\/schema\/person\/a052f43ac2ebe750c20e597aee6f52cd"},"headline":"What Is Spread Betting?","datePublished":"2020-12-03T13:41:48+00:00","dateModified":"2021-05-04T09:21:03+00:00","mainEntityOfPage":{"@id":"https:\/\/bornrealist.com\/what-is-spread-betting\/"},"wordCount":1021,"publisher":{"@id":"https:\/\/bornrealist.com\/#organization"},"image":{"@id":"https:\/\/bornrealist.com\/what-is-spread-betting\/#primaryimage"},"thumbnailUrl":"https:\/\/bornrealist.com\/wp-content\/uploads\/2018\/08\/iStock-880575498.jpg","articleSection":["Crypto"],"inLanguage":"en-US"},{"@type":"WebPage","@id":"https:\/\/bornrealist.com\/what-is-spread-betting\/","url":"https:\/\/bornrealist.com\/what-is-spread-betting\/","name":"What Is Spread Betting? | Born Realist","isPartOf":{"@id":"https:\/\/bornrealist.com\/#website"},"primaryImageOfPage":{"@id":"https:\/\/bornrealist.com\/what-is-spread-betting\/#primaryimage"},"image":{"@id":"https:\/\/bornrealist.com\/what-is-spread-betting\/#primaryimage"},"thumbnailUrl":"https:\/\/bornrealist.com\/wp-content\/uploads\/2018\/08\/iStock-880575498.jpg","datePublished":"2020-12-03T13:41:48+00:00","dateModified":"2021-05-04T09:21:03+00:00","breadcrumb":{"@id":"https:\/\/bornrealist.com\/what-is-spread-betting\/#breadcrumb"},"inLanguage":"en-US","potentialAction":[{"@type":"ReadAction","target":["https:\/\/bornrealist.com\/what-is-spread-betting\/"]}]},{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/bornrealist.com\/what-is-spread-betting\/#primaryimage","url":"https:\/\/bornrealist.com\/wp-content\/uploads\/2018\/08\/iStock-880575498.jpg","contentUrl":"https:\/\/bornrealist.com\/wp-content\/uploads\/2018\/08\/iStock-880575498.jpg","width":724,"height":483},{"@type":"BreadcrumbList","@id":"https:\/\/bornrealist.com\/what-is-spread-betting\/#breadcrumb","itemListElement":[{"@type":"ListItem","position":1,"name":"Home","item":"https:\/\/bornrealist.com\/"},{"@type":"ListItem","position":2,"name":"What Is Spread Betting?"}]},{"@type":"WebSite","@id":"https:\/\/bornrealist.com\/#website","url":"https:\/\/bornrealist.com\/","name":"Born Realist","description":"Doers Not Dreamers","publisher":{"@id":"https:\/\/bornrealist.com\/#organization"},"potentialAction":[{"@type":"SearchAction","target":{"@type":"EntryPoint","urlTemplate":"https:\/\/bornrealist.com\/?s={search_term_string}"},"query-input":"required name=search_term_string"}],"inLanguage":"en-US"},{"@type":"Organization","@id":"https:\/\/bornrealist.com\/#organization","name":"Born Realist","url":"https:\/\/bornrealist.com\/","logo":{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/bornrealist.com\/#\/schema\/logo\/image\/","url":"https:\/\/bornrealist.com\/wp-content\/uploads\/2017\/02\/new.png","contentUrl":"https:\/\/bornrealist.com\/wp-content\/uploads\/2017\/02\/new.png","width":281,"height":65,"caption":"Born Realist"},"image":{"@id":"https:\/\/bornrealist.com\/#\/schema\/logo\/image\/"},"sameAs":["https:\/\/web.facebook.com\/DaBornRealist\/","https:\/\/twitter.com\/DaBornRealist","http:\/\/instagram.com\/bornrealist","https:\/\/www.linkedin.com\/company\/born-realist\/","https:\/\/www.pinterest.com\/bornrealist\/"]},{"@type":"Person","@id":"https:\/\/bornrealist.com\/#\/schema\/person\/a052f43ac2ebe750c20e597aee6f52cd","name":"Silver Crow","description":"Aspiring writer and a very passionate problem solver","url":"https:\/\/bornrealist.com\/author\/silvercrow\/"}]}},"_links":{"self":[{"href":"https:\/\/bornrealist.com\/wp-json\/wp\/v2\/posts\/41572"}],"collection":[{"href":"https:\/\/bornrealist.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/bornrealist.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/bornrealist.com\/wp-json\/wp\/v2\/users\/10"}],"replies":[{"embeddable":true,"href":"https:\/\/bornrealist.com\/wp-json\/wp\/v2\/comments?post=41572"}],"version-history":[{"count":0,"href":"https:\/\/bornrealist.com\/wp-json\/wp\/v2\/posts\/41572\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/bornrealist.com\/wp-json\/wp\/v2\/media\/34547"}],"wp:attachment":[{"href":"https:\/\/bornrealist.com\/wp-json\/wp\/v2\/media?parent=41572"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/bornrealist.com\/wp-json\/wp\/v2\/categories?post=41572"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/bornrealist.com\/wp-json\/wp\/v2\/tags?post=41572"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}