Trading entire stock markets is one of the best ways to ride the big financial trends of the day. For example, if you think that things are looking up in America, you could do a "buy" trade on the Dow Jones index.
Or if you believe that Japan is in for more hardship, you could do a "sell" trade on its Nikkei index. With a spread bet, you can easily take positions like these and many more from one single account.
Buying and selling different markets around the world can also give you exposure to specific themes. For example, mining shares make up quite a bit weighting of the UK and Australian stock markets.
So, if you had a particular view about miners, targeting these countries' main indices could make sense. Likewise, manufacturing firms play a big part in Germany's DAX index, enabling you to speculate on industrial trends - see chart.
Trading with Tradefair Spreads
On the Tradefair Spreads website, you can trade an impressive range of stock markets from across the world. As well as the main benchmarks in the UK, America and Europe, you can speculate on the top indices in Japan, South Africa, Australia and India. And you don't have to worry about exchange rates either, as all your positions and profits will be quoted in your chosen currency.
Indices as an indicator
Even if it is individual shares that interest you most, you should still pay attention to the major indices. So, you might think a particular UK share looks attractive, but if the FTSE is going the other way, you may be better off sitting tight. The same goes for the main markets internationally. What happens in America's main indices - the Dow, the S&P and the Nasdaq - can have a huge impact on markets in the rest of the world.
'Trading Indices' written for Tradefair Spreads by Dominic Picarda of the Investor's Chronicle and the Financial Times.
The above comments do not constitute investment advice and neither Tradefair Spreads nor Clean Financial accept any responsibility for any use that may be made of them.
Risk Warning:
Spread bets carry a high level of risk so you should only speculate with money you can afford to lose. You can lose more than your initial deposit and stake. Before you open an account, please ensure that spread betting matches your investment objectives, familiarise yourself with the risks involved and if necessary seek independent advice.
Article provided / approved by Tradefair Spreads which is a trading name of London Capital Group Ltd which is authorised and regulated by the Financial Services Authority (FSA), FSA Register number 182110.
Tradefair® is part of the Betfair Group.
'Trading Indices' edited by DB, updated 23-Apr-09
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Risk Warning:
Please note that spread betting and CFD trading carry a high level of risk to your capital. You can lose more than your initial deposit. These products 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.
* Tax law is subject to change or may differ if you pay tax in a jurisdiction other than the UK.
