There are so many different investment options that are available at the moment. There is no excuse not to find something that is suitable for your personal investment style. You can make money these days if you gather the knowledge you need to use dozens of different methods. One of them is financial spread betting online. This particular option keeps gaining popularity because of a long list of possible advantages, including the important ones mentioned below.
Really Easy To Understand
Financial spread betting is really easy to understand. The process you go through is much less complex than contracts for difference, futures or options.
Winnings Are Tax Free
This is one advantage that few people take into account when looking at spread betting online and it is a really big one. Taxes are basically eliminated because of the fact that the spread is normally a contract that happens between the betting company and you. There is no real physical shares exchange that is happening. Basically, the only tax is around 3%, which is a normal betting tax that is charged on the gross profits of the firm. This is normally absorbed through the spread.
Make sure that you always calculate taxes and fees when you many any investment or when you want to use any financial instrument in order to increase your funds. You will quickly figure out that taxes and fees are much higher than what you initially think.
Potentially Huge Returns
Spread betting will use a margin trading system so you do not have to fully pay the trade amount upfront. Most traders understand leverage needs to be used in the event that short-term trades are made in order to reap huge profits from smaller price movements.
The low margin requirements will normally offer great leverage at larger positions. You just need around 10% or less as deposited margin. This basically means that 2% share price increase can give you a 20% return. Margin trading will magnify the potential profits on commodity, index or equity positions.
Besides the taxes and fees that you normally have to deal with, as you trade through someone else, you are normally asked for a commission. This is not the case with spread betting online. All associated costs are basically built right into the offer spread.
As you talk to a traditional broker you have to pay a specific fee for every single share buying move. This is not something you need to deal with in spread betting.
Trading Outside Market Hours
We all live really busy lives and every single hour of our day is important. Having the possibility to spread bet at any moment of day or night is a potentially huge advantage for many different traders. Spread betting companies tend to be opened 24/7, with the exception of the weekend.
This practically means you can make money even when the traditional market is closed. You get over 12 hours of extra trading available for you, which can bring in a lot more money.