Spread Betting Surges

Spread betting is enjoying a surge in popularity which many commentators are linking to the current credit crunch and an atmosphere of economic uncertainty.

Whereas investors are usually quite happy to pile their wealth into stocks and shares when the stock market is bullish, an increasing number are looking to spread betting to help them make money or hedge traditional trading positions now that the market is looking more bearish.

Spread betting has always been popular with people who like to make money from the movement of stock and commodity prices, and for several good reasons:

• First, spread betting allows individuals to bet that a market will go down as well as up, which means they can make a profit even if the market takes a nose dive.

• Second, spread betting requires less capital than direct investment in stocks or shares. This is because it is betting, not investing, and at no point does the bettor actually own any of the stock or commodity that he bets on.

• Third, spread betting profits are tax-free at the time of writing, and that’s because they are betting profits, not investment profits.

Whilst spread betting is not something that will be relevant or useful to all investors, it is well worth considering if you are looking for a non-traditional way of making money form the movements of financial markets.

Of course, there is much more to spread betting than financial markets. Online sports betting is also catered for, so bettors can also use spread betting to try and make money from cricket, football, horse racing, greyhound racing and much more.

Whether spread betting is something that will help you to fare better as the so-called “credit crunch” continues we can’t say, but it’s certainly worth recognising it as a potentially useful tool. Take a look at our Spread Betting in the UK page for more information.

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