Spread Trading
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A guide to Spread Trading including a comparison of the key financial markets and where you can trade:
Where to Trade?
There are a number of regulated firms and they tend to offer thousands of international markets.
Of course, companies like FinancialSpreads which offer all the normal benefits of spread trading which include; no broker’s fees, no commissions, trading outside market hours, and tax free trading*.
Spread Trading Companies - Account Services Comparison
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| Online Application |
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| Credit Account |
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| Deposit Account |
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| Stop Loss Available |
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| Automatic Stop Loss |
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| 24 Hour Trading |
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| FSA Authorised and Regulated |
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| Candlestick Charts |
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Comparison Notes
Why Spread Trading?
Spread trading can be beneficial on a number of fronts including easy access to the international financial markets and certain tax based advantages.
1) Spread Trading is Tax Free*
There is no income or capital gains tax and no stamp duty to pay on spread trades.
2) Wide Variety of Markets
There is a large variety of markets on offer. You can speculate on thousands of markets from the popular FTSE 100 Index and Euro / Dollar exchange rate, to the not so popular Wheat, Dollar / Kroner and Interest Rate markets.
3) Closing a Trade to Take a Profit or Limit Losses
Spread trades can be closed early. This can work in two ways. You can close a profitable position in order to guarantee a profit. Conversely you can also close a losing position in order to stop any further losses.
4) Two Way Trading
Unlike traditional share trading, investors can sell a market if they think it will fall.
Spread trading lets you buy and sell, you do not have to speculate on markets to go up.
If your analysis leads you to think that a currency pair like or Pound Sterling/Yen or Euro/US Dollar will go down you can speculate on it to go down.
You can do the same with the shares, stock market indices and commodities markets.
5) Trading Speed
Generally, most trades are filled automatically; you do not have to worry about finding another party wanting the opposing trade. You are speculating on the future price of a particular market and so you are not taking ownership of an asset or stock.
6) No Commissions or Brokers
Spread trading companies do not generally impose commissions or broker's fees.
7) 24 Hour Trading
From an investment point of view, the fact that some markets can be traded 24 hours a day sets spread trading apart from traditional share trading.
The futures floors and stock exchanges might be closed but you can still spread trade on a variety of key markets.
8) Risk Management with a Guaranteed Stop Loss
As discussed above, investing does have its negative side. However, there are steps you can take to reduce your risks. You can add a Guaranteed Stop Loss to your trades.
If a market moves against your position then the stop loss will close your position and prevent you from losing any more funds.
9) Data, Data, Data
Many spread trading companies now offer their clients a wealth of free data. In addition to candlestick charts, certain firms also offer technical analysis and analysis on specific companies and market sectors.
Spread Trading Comparison
Spread Trading Stock Market Index Comparison
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| FTSE 100 Daily - Spread Size |
1 |
1 |
1 |
1 |
1 |
1 |
2 |
1 |
| FTSE 100 Daily - Min Stake |
£1 |
£2 |
£1 |
£1 |
£1 |
£1 |
£1 |
£1 |
| FTSE 100 Future - Spread Size |
4 |
6 |
4 |
4 |
3 |
4 |
3 |
4 |
| FTSE 100 Future - Min Stake |
£1 |
£2 |
£1 |
£1 |
£1 |
£1 |
£1 |
£1 |
| Wall St Daily - Spread Size |
2 |
2 |
2 |
2 |
2-4 |
2 |
4 |
2 |
| Wall St Daily - Min Stake |
£1 |
£1 |
£1 |
£1 |
£1 |
£1 |
£1 |
£1 |
| DAX 30 Daily - Spread Size |
1 |
1 |
1 |
2 |
1 |
1 |
2 |
1 |
| DAX 30 Daily - Min Stake |
£1 |
£2 |
£1 |
£1 |
£1 |
£1 |
£1 |
£1 |
| S&P 500 Daily - Spread Size |
4 |
5 |
4 |
3 |
5 |
4 |
5 |
4 |
| S&P 500 Daily - Min Stake |
£1 |
£1 |
£1 |
£1 |
£1 |
£1 |
£1 |
£1 |
| Nasdaq 100 Future - Spread Size |
3 |
4 |
3 |
3 |
4 |
3 |
3 |
3 |
| Nasdaq 100 Future - Min Stake |
£1 |
£4 |
£1 |
£1 |
£1 |
£1 |
£1 |
£1 |
Comparison Notes
Spread Trading Forex Comparison
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| GBP / USD Daily - Spread Size |
2 |
2 |
2 |
3 |
0.8 |
2 |
3 |
2 |
| GBP / USD Daily - Min Stake |
£1 |
£0.50 |
£1 |
£0.5 |
£1 |
£1 |
£1 |
£1 |
| GBP / USD Future - Spread Size |
8 |
12 |
8 |
8 |
- |
8 |
16 |
8 |
| GBP / USD Future - Min Stake |
£1 |
£1 |
£1 |
£1 |
- |
£1 |
£1 |
£1 |
| EUR / GBP Daily - Spread Size |
1 |
2 |
1 |
1 |
1 |
1 |
2 |
1 |
| EUR / GBP Daily - Min Stake |
£1 |
£0.50 |
£1 |
£0.5 |
£1 |
£1 |
£1 |
£1 |
| EUR / GBP Future - Spread Size |
6 |
10 |
6 |
6 |
- |
6 |
17 |
6 |
| EUR / GBP Future - Min Stake |
£1 |
£1 |
£1 |
£0.5 |
- |
£1 |
£1 |
£1 |
| EUR / USD Daily - Spread Size |
1 |
1 |
1 |
2 |
0.8 |
1 |
2 |
1 |
| EUR / USD Daily - Min Stake |
£1 |
£0.50 |
£1 |
£0.5 |
£1 |
£1 |
£1 |
£1 |
| EUR / USD Future - Spread Size |
8 |
12 |
8 |
8 |
3 |
8 |
12 |
8 |
| EUR / USD Future - Min Stake |
£1 |
£1 |
£1 |
£1 |
£1 |
£1 |
£1 |
£1 |
| USD / JPY Daily - Spread Size |
1 |
1 |
1 |
2 |
0.8 |
1 |
2 |
1 |
| USD / JPY Daily - Min Stake |
£1 |
£0.50 |
£1 |
£0.5 |
£1 |
£1 |
£1 |
£1 |
| USD / JPY Future - Spread Size |
8 |
12 |
8 |
10 |
- |
8 |
14 |
8 |
| USD / JPY Future - Min Stake |
£1 |
£1 |
£1 |
£0.5 |
- |
£1 |
£1 |
£1 |
Comparison Notes
Spread Trading Commodities Comparison
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| Gold Daily - Spread Size |
4 |
5 |
4 |
4 |
5 |
4 |
5 |
4 |
| Gold Daily - Min Stake |
£1 |
£1 |
£1 |
£0.1 |
£1 |
£1 |
£1 |
£1 |
| Gold Future - Spread Size |
6 |
6 |
6 |
6 |
7 |
6 |
13 |
6 |
| Gold Future - Min Stake |
£1 |
£1 |
£1 |
£0.1 |
£1 |
£1 |
£1 |
£1 |
| Brent Crude Daily - Spread Size |
5† |
5 |
5† |
4 |
5† |
5† |
5 |
5† |
| Brent Crude Daily - Min Stake |
£1 |
£1 |
£1 |
£0.5 |
£1 |
£1 |
£1 |
£1 |
| Brent Crude Future - Spread Size |
5 |
6 |
5 |
6 |
5 |
5 |
5 |
5 |
| Brent Crude Future - Min Stake |
£1 |
£1 |
£1 |
£0.5 |
£1 |
£1 |
£1 |
£1 |
| US Crude Oil Daily - Spread Size |
5† |
5 |
5† |
4 |
5† |
5† |
6 |
5† |
| US Crude Oil Daily - Min Stake |
£1 |
£1 |
£1 |
£0.5 |
£1 |
£1 |
£1 |
£1 |
| US Crude Oil Future - Spread Size |
5 |
6 |
5 |
6 |
5 |
5 |
6 |
5 |
| US Crude Oil Future - Min Stake |
£1 |
£1 |
£1 |
£0.5 |
£1 |
£1 |
£1 |
£1 |
Comparison Notes
How to Trade
The most popular spread trading markets are the FTSE 100, Dax 30 and Dow Jones (usually called ‘Wall Street’ by spread trading companies).
For specific examples see:
Spread Trading Companies
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Financial Spreads
Whether you are an experienced forex or commodities trader or new to spread trading and want to trade on shares or whole stock markets we offer extremely competitive prices through a high quality, reliable and efficient service...Financial Spreads.
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IG Index
IG Index - The UK's leading financial spread trading firm, offering prices in a wide range of indices, FX, commodities and options and thousands of individual shares....IG Index.
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Capital Spreads
With Capital Spreads you get all the normal advantages of Spread Trading: Tax Free Investments*, No Capital Gains Tax*, No brokers fees ...Capital Spreads.
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For more companies and to compare the spreads also see Spread Trading Companies.
Risk Warning: Spread trading 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.
'Spread Trading' by DB, updated 26-Jan-12
For related pages also see:
Forex Trading Guide, updated 26-Jan-12
Forex Trading Guide - Forex Trading Guide: the complete guide to trading the forex markets including where to trade, daily forex analysis, forex technical analysis, how to trade, the global forex market and...read article: Forex Trading Guide.
Spread Trading, updated 26-Jan-12
A guide to Spread Trading including a comparison of the key financial markets, where to trade and spread trading tips. This is also a...read article: Spread Trading.
Financial Trading Directory, updated 26-Jan-12
Who to trade with? It's a tough question. Have a quick look to see who offers the spreads and service to suit you....read article: Financial Trading Directory.
Spreads UK, updated 26-Jan-12
Trading with UK spread trading companies, a look at the UK spreads markets and...read article: Spreads UK.
Tradefair Spreads, updated 25-Jan-12
With a Tradefair Spreads account you can trade commission-free and tax-free* on 2,500+ spread trading markets. A Tradefair account also offers 24 hour spread trading, iPhone trading, advanced pattern recognition software and ...read article: Tradefair Spreads.
Spreadex, updated 25-Jan-12
Spreadex spread trading review. Details on spread sizes, markets offered, orders available as well as free chart data...read article: Spreadex.
Low Cost Spread Trading, updated 26-Jan-12
Low Cost Spread Trading - When trading on the financial markets, Spread Co understands that it's all about your bottom line. Spread Co lets you reduce the cost of trading and cut down on the capital required by...read article: Low Cost Spread Trading.
InterTrader, updated 27-Jan-12
With an InterTrader spreads account you can trade over 2,000+ markets including UK and US shares, stock market indices like the FTSE 100, gold, crude and more. They also offer 24 hour trading, free candlestick charts, live prices and...read article: InterTrader.
IG Markets, updated 27-Jan-12
IG Markets - Trade CFDs on the award winning platform from the UK's number one CFD provider. With an IG Markets Account you can trade thousands of markets from UK and International Shares to Forex, Indices, Commodities and...read article: IG Markets.
IG Markets Android Trading App, updated 28-Oct-11
IG Markets Android Trading App review: Leading CFD provider, IG Markets now offer an Android Trading App where clients can check charts, trade CFDs and apply trading orders. The Android CFD Trading App also lets users...read article: IG Markets Android Trading App.
IG Markets - CFD Provider of the Year, updated 24-Dec-10
IG Markets, the leading provider of Contracts for Difference, has been awarded the title of CFD provider of the year, as voted for by...read article: IG Markets - CFD Provider of the Year.
Changes at the Top for IG Markets, updated 09-Nov-10
IG Markets, a leader in the dealings of financial derivatives and margined forex trading, today announced the promotion of Dan Cook to Chief Executive Officer of...read article: Changes at the Top for IG Markets.
IG Markets Reduces Spreads on Key Indices, updated 25-Oct-10
IG Markets Reduces Spreads on Key Indices - IG Markets, the UK's leading Contract for Difference (CFD) provider, has announced that it has further improved its pricing on a number of popular index...read article: IG Markets Reduces Spreads on Key Indices.
IG Index, updated 30-Jan-12
With an IG Index account you get all the normal benefits of financial spread trading including commission free and tax free trading*. You can also access over 8,000 markets and trade key markets 24 hours a day, 5 days a week. Plus there is...read article: IG Index.
GFT, updated 30-Jan-12
GFT offer a wide range of investment and trading products including Spread Trading, CFDs and margined Forex. With a GFT spread trading account you can trade thousands of markets tax free* and commission free. GFT also let you trade some key markets 24 hours per day and...read article: GFT.
FXCM, updated 31-Jan-12
FXCM - FXCM offer spread trading, forex trading and CFDs. A FXCM account offers 24 hour trading, tight spreads, automated dealing with no re-quotes, a range of charting packages and...read article: FXCM.
Finspreads UK, updated 31-Jan-12
Finspreads UK - Finspreads offer a wide range of zero commission spread trading options. With a Finspreads Account you can trade tax free* on UK Shares, US Shares, Forex, Commodities, Indices and...read article: Finspreads UK.
Financial Spread, updated 01-Feb-12
With Financial Spread you get all the normal advantages of Financial Spread Trading like Tax Free*, Commission Free trading. You also get tight spreads, the FTSE 100 spread is only 1pt and...read article: Financial Spread.
ETX, updated 01-Feb-12
ETX Capital offer commission free, tax free* spread trading on thousands of markets. An ETX Capital account offers tight spreads, low margins, 24 hour trading and...read article: ETX.
CMC Markets Account, updated 02-Feb-12
With CMC Markets you get all the normal advantages of Spread Trading like Tax Free* Trading with 0% commissions. With a CMC Markets Account you can trade key markets 24 hours a day, 5 days a week. Plus there is...read article: CMC Markets Account.
City Index, updated 03-Feb-12
City Index offers tax free* spread trading. With a City Index Account you can trade free commission on indices, forex, shares and commodities. City Index also offer CFDs where you can...read article: City Index.
Ladbrokes Financial Spreads, updated 17-Jun-10
Ladbrokes Financial Spreads offers investors a range of benefits including Free Guaranteed Stops, Spreads from as low as 1 point and the ability to buy and sell major financial markets, including stock market indices, equities, FX markets, commodities and...read article: Ladbrokes Financial Spreads.
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Q) Average Trading Results?
A) Get free spread trading tips, offers, price updates, important news and more!
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