Where to Spread Bet on American Express?

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

• Financial Spread
• Tradefair
• IGIndex

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

Spread Betting on American Express

Should you want to speculate on firms like American Express then one option could be spread betting on the American Express share price.

If an investor was to look at the Tradefair trading site, as of Thursday, they were showing the American Express Rolling Daily market at $46.10 – $46.17. As a result, you could spread trade on the American Express shares:

• Going higher than $46.17, or
• Going lower than $46.10

Whilst financial spread betting on US shares you trade in £x per cent. Therefore, if you invest £4 per cent and the American Express share price moves $0.05 then that would be a difference to your profits (or losses) of £20. £4 per cent x $0.05 = £20.

You can also invest in this market in Dollars or Euros, e.g. €x per cent.

Rolling Daily Equities Markets

Be aware that this is a Rolling Daily Market and so there is no set closing date for this market. If you decide to leave your trade open at the end of the day, it simply keeps rolling over into the next trading session.

If you do let your trade roll over into the next day and are spread betting on the market to:

• Move up – then you will be charged a small overnight financing fee, or
• Move down – then you will normally receive a small credit to your account

For a more detailed example see Rolling Daily Spread Betting.

American Express Rolling Daily – US Shares Trading Example

Now, if we think about the spread of $46.10 – $46.17 and assume that:

• you have done your market research, and
• you feel that the American Express shares look like they will move above $46.17

then you might choose to buy at $46.17 and invest £2 per cent.

With such a bet you make a profit of £2 for every cent that the American Express shares go higher than $46.17. Of course, it also means that you will lose £2 for every cent that the American Express market moves below $46.17.

Put another way, should you buy a spread bet then your profits (or losses) are calculated by taking the difference between the settlement price of the market and the price you bought the market at. You then multiply that price difference by your stake.

If after a few trading sessions the stock started to rise you might decide to close your trade in order to secure your profit.

As an example, should the market rise, the spread, set by the spreads firm, might be adjusted to $46.68 – $46.75. You would close/settle your spread bet by selling at $46.68. Accordingly, with the same £2 stake you would make:

Profits (or losses) = (Settlement Price – Initial Price) x stake
Profits (or losses) = ($46.68 – $46.17) x £2 per cent stake
Profits (or losses) = $0.51 x £2 per cent stake
Profits (or losses) = 51¢ x £2 per cent stake
Profits (or losses) = £102 profit

Speculating on equities can go against you. With this example, you wanted the share price to increase. However, it could fall.

If the American Express share price fell then you might choose to close your position to stop any further losses.

Should the spread drop to $45.59 – $45.66 then you would sell back your position at $45.59. This would result in a loss of:

Profits (or losses) = (Settlement Price – Initial Price) x stake
Profits (or losses) = ($45.59 – $46.17) x £2 per cent stake
Profits (or losses) = -$0.58 x £2 per cent stake
Profits (or losses) = -58¢ x £2 per cent stake
Profits (or losses) = -£116 loss

Note – American Express Rolling Daily equities market quoted as of 20-Oct-11.

American Express Spread Betting – More Details

For more information on trading American Express, also see American Express 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.