subject: Ftse Spread Betting - Something To Consider [print this page] Over the recent weeks we have seen volatility return to the stock markets. The FTSE 100 has been below the 5000 barrier and is now up above it again. If you are a long-term investor with a buy and hold strategy then this might be a bit frustrating to you.
Are you one of these investors who has seen many of your gains this year wiped out? If you are then I think that you should look to other methods of trading to help to try and make profits. You want a way of benefiting from the volatility we have seen recently and a method of doing that is FTSE spread betting.
So what is FTSE spread betting? Well it is a way of trading the FTSE 100. You don't own shares as such but you place a stake per point move. If the market moves in your favour then you will make a profit. If the market moves against you then you will make a loss.
One of the biggest advantages of FTSE spread betting is that you can go short. This means that if you think the market is going to decline, you can take a short position and if you are right you can make a profit. This is a great way of hedging your other long positions that you have.
A further advantage of FTSE spread betting is that you don't have to pay tax in the UK. Your only charges are the spread of the trade, you don't even have to pay commission. All this means that it is cheaper than trading traditional stocks and shares.
Being able to trade on a margin can be either good or bad. Leverage causes massive problems for some people so if you can't cope with it then you should stay away. If you can then leverage can offer a real advantage.
Hopefully you should've seen that FTSE spread betting could offer some great alternatives to other investments. Make sure you are confident in knowing the risks before you start.
