Where to Spread Bet on Burberry?

You can spread bet on Burberry with any of the following companies:

• Financial Spread
• InterTrader
• IG Index

Although note that you can also spread bet with other Spread Betting Companies.

Spread Betting on Burberry

If you decide to speculate on companies such as Burberry then one possibility could be spread trading on the Burberry share price.

If an investor was to look at the capital spreads spread betting site, as of Friday, they were showing the Burberry Rolling Daily market at 1130.6p – 1135.4p. This means you could spread bet on the Burberry share price:

• Moving above 1135.4p, or
• Moving below 1130.6p

Whilst financial spread betting on UK equities you trade in £x per penny. Therefore, should you decide to invest £6 per penny and the Burberry shares move 5p then that would be a difference to your profit/loss of £30. £6 per penny x 5p = £30.

Rolling Daily Shares Markets

One important thing to note is that this is a Rolling Daily Market and so there is no preset settlement date for this market. If you decide to leave your trade open at the end of the day, it will roll over to the next session.

If your position does roll over and you are speculating on the market to:

• Move up – then you would normally pay a small financing fee, or
• Move down – then a small payment is normally credited to your account

To learn more about Rolling Daily Markets please see Rolling Daily Spread Betting.

Burberry Rolling Daily Shares Spread Trading Example

So, if you think about the spread of 1130.6p – 1135.4p and assume:

• you have done your market research, and
• you feel that the Burberry share price is likely to push higher than 1135.4p

then you might decide that you are going to buy at 1135.4p and invest, for example, £3 per penny.

So, you win £3 for every penny that the Burberry shares increase and move above 1135.4p. Of course, such a bet also means that you will make a loss of £3 for every penny that the Burberry market moves below 1135.4p.

Looked at another way, if you were to ‘Buy’ a spread bet then your profit/loss is found by taking the difference between the settlement price of the market and the price you bought the spread at. You then multiply that difference in price by your stake.

As a result, if after a few hours the stock started to rise you might decide to close your spread bet in order to secure your profit.

So if the market moved up then the spread, set by the spread trading company, might change to 1178.0p – 1182.8p. In order to close your position you would sell at 1178.0p. Therefore, with the same £3 stake:

P&L = (Closing Price – Opening Price) x stake
P&L = (1178.0p – 1135.4p) x £3 per penny stake
P&L = 42.6p x £3 per penny stake
P&L = £127.80 profit

Financial spread trading on shares can work against you. In this example, you had bet that the share price would rise. However, the share price could go down.

If the Burberry share price had started to fall then you might choose to close your position to limit your losses.

Should the market pull back to 1095.7p – 1100.5p then you would settle/close your trade by selling at 1095.7p. As a result, your loss would be:

P&L = (Closing Price – Opening Price) x stake
P&L = (1095.7p – 1135.4p) x £3 per penny stake
P&L = -39.7p x £3 per penny stake
P&L = -£119.10 loss

Note: Burberry Rolling Daily spread betting market taken as of 18-Mar-11.

Burberry Spread Betting – More Details

For more information on trading Burberry, also see Burberry Spread Betting.

Spread betting carries a high level of risk to your capital. You may lose more than your initial investment. It 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.