What is Financial Spread Betting?

A spread bet is a contract with an FSA-regulated spread betting dealer to exchange the difference between the opening and the closing value of an instrument. The instrument can be an individual equity, commodity, bond, currency pair or stock index.

A financial spread bet is really a type of contract for differences. However, the main difference between financial spread betting and CFDs is that the buy/sell price for spread betting markets includes a GFT Global Markets spread, rather than charging a commission; spread bets build any commission into the spread. For U.K. residents, there are also tax advantages to spread betting instead of trading CFDs.

Why Spread Bet?

As one of the U.K.’s fastest-growing trading instruments, spread bets can be comparatively easy to trade, with low costs to enter the market. They are more flexible than other trading methods, as you can find trading opportunities in rising and falling markets.

Spread bets are based on the idea of traditional share trading, but they differ because you don't actually own the share; it is a derivative product. Spread bets offer active traders significant benefits over other trading products, including the ability to use leverage to seek profits in rising or falling markets.

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*Tax laws can change. GFT Global Markets does not offer tax or legal advice. A professional advisor should be sought if you need legal or tax advice.

Financial Spread Bets are a leveraged product and therefore may not be suitable for all investors. Financial Spread Bets carry a high degree of risk to your capital and it is possible to lose more than your initial investment or credit allocation as well as any variation margin that you may be required to deposit from time to time. You should only speculate with money that you can afford to lose. Please ensure that you fully understand the risks involved and seek independent advice if necessary and prior to entering into such transactions.

Click here to read the full risk warning.