ASX 200 Spread Betting
Where Can I Spread Bet on the ASX 200? |
Investors are able to spread bet on the ASX 200 with:
Advert:
ASX 200 Spread Betting, sponsored by FinancialSpreads.com.
You can spread bet on the ASX 200 with
Financial Spreads.
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Where Can I Spread Bet on the ASX 200 for Free? |
Trading always involves an element of risk, but if you want to open a completely free Test Account, that allows you to try out financial spread betting on a broad range of markets, then see below for further details.
Furthermore, spread trading, in the UK, is free of capital gains tax, stamp duty and income tax*.
If you're looking for a low cost financial spread betting website then note that investors can financial spread bet on the ASX 200 with no commissions and no brokers' fees with companies like:
If you'd like to open a free Practice Account which lets users try spread betting on markets such as the ASX 200, then look into:
The above spread trading companies currently provide a risk free Demo Account which lets users apply a range of trading orders, analyse professional charts and test trading strategies.
How to Spread Bet on the ASX 200? |
As with most key financial markets, you are able to spread bet on indices, like the ASX 200, to rise or fall.
Looking at a financial spread betting site like Tradefair, we can see that they are currently offering the ASX 200 Rolling Daily market at 4339.5 - 4342.5. Therefore, an investor could spread trade on the ASX 200 market:
 Increasing above 4342.5, or
 Decreasing below 4339.5
Whilst spread trading on the ASX 200 index you trade in £x per point. So, if you staked £5 per point and the ASX 200 moves 38 points then that would change your P&L by £190. £5 per point x 38 points = £190.
Rolling Daily Indices Markets
Note that this is a Rolling Daily Market and therefore there is no settlement date for this market. You do not have to close your trade, should it still be open at the end of the trading day, it just rolls over to the next trading session.
If your trade does roll over and you are speculating on the market to:
Increase - then you will be charged a small overnight financing fee, or
Decrease - then you will usually receive a small credit to your account
For more information on Rolling Daily Markets, and a fully worked example, please see Rolling Daily Spread Betting.
ASX 200 Rolling Daily - Index Spread Betting Example |
If you think about the above spread of 4339.5 - 4342.5 and make the assumptions that:
- You have done your analysis of the indices markets, and
- You feel that the ASX 200 index will push higher than 4342.5
Then you could go long of the market at 4342.5 and risk, for the sake of argument, £2 per point.
So, you gain £2 for every point that the ASX 200 index rises above 4342.5. Conversely, however, it also means that you will make a loss of £2 for every point that the ASX 200 market moves below 4342.5.
Considering this from another angle, should you buy a spread bet then your profits (or losses) are worked out by taking the difference between the final price of the market and the price you bought the market at. You then multiply that difference in price by your stake.
As a result, if after a few sessions the Australian stock market started to increase then you might think about closing your spread bet so that you can secure your profit.
Taking this a step further, if the market rose then the spread, set by the spreads firm, might be adjusted to 4409.8 - 4412.8. You would close your spread bet by selling at 4409.8. So, with the same £2 stake your profit would come to:
Profit = (Closing Value - Initial Value) x stake
Profit = (4409.8 - 4342.5) x £2 per point stake
Profit = 67.3 x £2 per point stake
Profit = £134.60 profit
Speculating on indices, by spread betting or otherwise, is not easy. In this example, you wanted the Australian index to rise. However, it can also go down.
If the ASX 200 index weakened, against your expectations, then you might choose to close your spread bet to stop any further losses.
If the spread fell to 4282.8 - 4285.8 then this means you would close your spread bet by selling at 4282.8. As a result, your loss would be:
Loss = (Closing Value - Initial Value) x stake
Loss = (4282.8 - 4342.5) x £2 per point stake
Loss = -59.7 x £2 per point stake
Loss = -£119.40 loss
Note: ASX 200 Rolling Daily spread betting market taken as of 26-Sep-12.
Where Can I Find Live Spread Betting Prices and Charts for the ASX 200? |
To gain access to live prices and charts for the ASX 200, an option is to use a spread betting account. Readers should note that opening such an account is normally dependent on credit and status checks.
If your application is approved then you can log in to review the real-time prices and charts. On most platforms, these are provided for free. Having said that, you'll probably receive the odd call or newsletter from the online spread betting firm.
If you decide to spread bet then, before you start, be aware that spread trading involves a high degree of risk to your trading capital and losses can exceed your initial investment.
Though the specific charting packages differ across the various platforms, to help you with your technical analysis, most charts usually have valuable tools and features, including:
- A broad variety of time intervals - 3 minutes, 15 minutes, 1 day etc.
- A variety of display styles - line, bar and candlestick charts
- Tools for drawing features - Fibonacci Arcs, Fans and Time Zones
- Indicators - Bollinger Bands, Parabolic SAR etc.
Charts with Financial Spreads also include other benefits such as:
- Back Testing
- Email alerts for when the markets hit a certain level
Example stock market trading chart
The spread betting firms listed below offer their clients real-time prices and charts:
Advert:
ASX 200 Spread Betting, sponsored by FinancialSpreads.com.
You can spread bet on the ASX 200 with
Financial Spreads.
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Risk Warning: Spread betting and CFD trading carry a high level of risk to your capital and you may lose more than your initial investment. Spread betting and CFD trading may not be suitable for all investors. Only speculate with money that you can afford to lose. Please ensure you fully understand the risks involved and seek independent financial advice where necessary.
'ASX 200 Spread Betting' by DB, updated 07-May-13
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