Category — Financial Spread Betting Tips

Financial Market Comments from Will Hedden, Sales Trader, IG Index.

In early trading the FTSE 100 has reacted poorly to further signs of global economic slowdown.

At 10.00am (London time) the UK’s blue chip index was down 7.69 points to 5245.83 following worrying, though widely expected, numbers from the US and China overnight.

The Fed cut its GDP forecast from 3.2-3.7% to 3-3.5%, while Chinese GDP figures revealed that second-quarter growth had slowed to 10.3% compared with Q1’s encouraging 11.9%.

No prizes for guessing who felt the effects of the news from China the hardest. Miners Rio Tinto, Vedanta Resources, BHP Billiton, Xstrata and Kazakhmys all suffered as investors got twitchy about dwindling demand for resources.

While bankers moped around the bottom of the table along with their heavyweight mining buddies, the world’s largest credit-checking company, Experian, gained 2.60% to top the index after it announced that total first-quarter revenues had risen 7%.

It’s the tech sector’s turn to come into focus later today, with updates from AMD and Google due out this afternoon.

Forecasts for the latter have not been encouraging; at least three analysts have cut estimates and Wall Street is decidedly cautious about prospects for the internet giant.

This is particularly true in relation to its cost-per-click advertising business and comes despite the company having beaten revenue expectations in five of the previous seven quarters.

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.

Good Luck!

DB

The above comments do not constitute investment advice and Clean Financial accepts no responsibility for any use that may be made of them.

Content provided by IG Index which is Authorised and regulated by the Financial Services Authority. FSA Register number 114059.

Spread Co have released their new and improved trading platform. They have also expanded their product range and made a series of improvements to their services.

Spokesman Ian O’Sullivan said, “Spread Co has always had one of the most professional and slick trading platforms in the business and this latest release improves it further.

“We have been speaking to our clients from all over the world and have implemented many of their suggestions.

“There are also a number of further improvements in development, so watch this space”.

Ajay Pabari, CEO of Spread Co added, “We have also expanded our product offering, with additional currency pairs, ETFs and ADRs.

“In addition, we have lowered our Notional Trading Requirement on a large number of products. Spot Gold and US Crude Oil are down to just 80 points. That, together with the fact our Equity CFD commission is the lowest in the industry at just 0.075% and no minimum CFD ticket charge makes Spread Co one of the most complete and cost-effective spread betting and CFD providers around”.

For a review of the services offered, see Spread Co.

SpreadCo Offer

SpreadCo are now also challenging new account holders to beat their Head Trader with their new offer: “One Trade. £150. No Tears”.

For more details see: Spread Co Offer.

Spread Trading, Contracts for Difference and margin Foreign Exchange trading carry a high degree of risk to your capital and it is possible to lose more than your initial investment. Only speculate with money you can afford to lose. These products may not be suitable for all investors, therefore ensure you fully understand the risks involved, and seek independent advice if necessary.

Spread Co Limited which is authorised and regulated by the Financial Services Authority. Register No. 446677.

Good Luck!

DB

If you’re looking to speculate on the FTSE 100 then you might see the current spread of 5417.3 – 5418.3. That means you could spread bet on the FTSE 100 to

• Go above 5418.3, or
• Go below 5417.3

When spread betting, investors trade on every unit the market goes up or down. Specifically, for the FTSE 100 market a unit is 1 point of the index’s price movement.

Financial Spread Betting on the FTSE 100 to Go Up

If you bought the FTSE 100 spread at 5418.3 and the index went up then you might see the spread move to 5468.3 – 5469.3. If this were the case, you might decide to close your position for a profit at 5468.3.

P&L = (settlement price of the market – opening price of the market) x stake per point
P&L = (5468.3 – 5418.3) x £2 per point stake
P&L = 50 points x £2 per point
P&L = £100.00 profit

On the other hand, if the market had moved down to, as an example, 5372.2 – 5373.2, you might decide to close your spread bet to prevent further losses. In that case, you would sell back at 5372.2.

Therefore, with the same £2 per point stake:

P&L = (settlement price of the market – opening price of the market) x stake per point
P&L = (5372.2 – 5418.3) x £2 per point stake
P&L = -46.1 points x £2 per point
P&L = -£92.20 loss

Financial Spread Betting on the FTSE 100 to Go Down

A useful benefit of financial spread betting is that investors can go short of the markets.

The original market was 5417.3 – 5418.3.

If you were to sell the FTSE 100 spread at 5417.3 and the index decreased then the spread could become 5371.3 – 5372.3. If so, you might want to close your trade for a profit by buying at 5372.3.

P&L = (opening price of the market – settlement price of the market) x stake per point
P&L = (5417.3 – 5372.3) x £2 per point stake
P&L = 45.0 points x £2 per point
P&L = £90.00 profit

Markets can also rise, if the market were to rise up to 5457.7 – 5458.7, you might want to close your position to prevent further losses. Assuming this was the case, you would buy at 5458.7.

You would do this with the same £2 per point stake:

P&L = (opening price of the market – settlement price of the market) x stake per point
P&L = (5417.3 – 5458.7) x £2 per point stake
P&L = -41.4 points x £2 per point
P&L = -£82.80 loss

(FinancialSpreads.com FTSE 100 Rolling Daily prices quoted as of 13-May-10).

Spread Betting on the FTSE 100

Common FTSE 100 questions – click on the link for the answer.

Q) Where can I Spread Bet on FTSE 100?
Q) Where can I Trade for Free on FTSE 100?
Q) How to Spread Bet on FTSE 100?
Q) Where can I find Free Live Prices on FTSE 100?
Q) Where can I find Free FTSE 100 Charts?

Note: Spread betting carries a high level of risk to your capital and 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.

Good Luck!

DB

It’s worth having a look in today’s Times, there is a 16 page special report on Trading Gold and FX.

The report:

• Looks into the different ways and strategies of going about trading gold and FX from a retail perspective
• Touches on what drives currencies – gold being the oldest currency of them all
• Explores different ways to access the markets
• Reviews how you can trade these asset classes

Plus ‘the benefits of mobile trading’ and a look at charting packages.

According to the report the articles are written by leading FX and gold commentators; Jessica Mead, John Stepek and Dominic Picarda who give a balanced and objective view on the benefits of trading gold & FX.

For an online version you can also see: Trading Gold and FX Report.

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.

Good Luck!

DB

The above comments do not constitute investment advice and Clean Financial accepts no responsibility for any use that may be made of them.

Financial Market Comments from Philip Gillett, Sales Trader, IG Index.

In mid-morning trading UK shares have started off weakly again as investors await the latest US unemployment numbers.

We are seeing fairly broad-based weakness so far today for London blue chips, with another weak performance on US markets and indices weighing on sentiment.

This is the fourth day on the trot we have seen weakness for UK shares as the last two weeks have proved to be a real test of whether traders believe this weakness is yet another buying opportunity for the next push higher.

So far the 5000 mark has underpinned the FTSE slide today, and now all eyes are on the latest US Nonfarm payrolls release, due out at 1.30pm UK time.

This is expected to show that around 175,000 jobs were lost in the US economy last month – a number worse than this could be the catalyst that erases any remaining positive sentiment for the short-term and may spark a bigger sell-off.

At the moment, US markets are looking a little firmer ahead of the official open, with the Dow Jones currently trading 15 points higher than last night’s close, but this is irrelevant until those payrolls are out of the way.

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.

Good Luck!

DB

The above comments do not constitute investment advice Clean Financial accepts no responsibility for any use that may be made of them.

Content provided by IG Index which is Authorised and regulated by the Financial Services Authority. FSA Register number 114059.