Financial Spread Betting – a popular choice for investors who trade in financial markets
The recent economic crisis and subsequent recession has seen the value of many investments drop causing many people to lose capital. Even regular traders have faced significant losses as share prices have fallen and in some instances, failed to recover. Despite falling markets, many traders utilising financial spread betting have been able to make a return on investments and have secured profits. As the nature of financial spread betting ensures investors can benefit from falling markets as well as booming ones, traders have more opportunity to make a profit and can do so even during a global recession.
There are a number of markets which spread trading companies make available to traders but financial betting remains one the most popular methods of investing. In addition to betting on the rise and fall of share prices, indices and Forex markets, investors can place spread bets on commodities, exchange traded funds and bonds and interest rates.
Spreadbetting on the movement of indices such as the FTSE, the Dow, the Dax and Nasdaq is a popular choice for investors who trade in the financial markets. The index helps to measure the behaviour of the market and enables traders to bet on whether it will rise or fall. Whilst well known indices such as the CAC, Nikkei and Swiss Index are popular markets for investors, there are a number of indices that investors can place spread bets on.
Forex trading is another popular market for spread bettors. Investors are able to predict how they think the price of one currency will compare to another and bet according. With the Bank for International Settlements estimating that the market has an estimated daily turnover of $3.98 trillion, the market is one of the largest and can offer substantial financial gains to successful investors.
In addition to indices markets and Forex trading, share prices and commodities are also popular markets for investors. Rather than purchasing the shares, the trader is merely betting on the whether the price will rise or fall. As there is no transfer of ownership, investors aren’t required to pay brokerage fees and therefore avoid the costs associated with traditional trading. Traders can bet on a number of shares from across the markets and open and close bets as often as they wish to do so without relying on brokers or financial institutions. Similarly, investors can bet on the price of commodities in the same way.
By using financial spread-betting to bet on the rise and fall of markets, indices and shares, investors can gain from changes in the market that would cause traditional investments to fail. This not only gives investors more opportunity to profit but enables traders to recoup unavoidable losses caused by economic instability and recessions. For example, as the price of commodities rise, many consumers are paying more on their grocery and petrol bills. By successfully betting on these commodities they can offset the loss and even make a profit.
The range of markets available means that investors can trade across or variety of markets or choose to trade on markets they are familiar with. The financial data supplied by spreadbetting companies, in addition to data and information supplied by other sources and reported on by the media, enables investors to recognise trends in the markets and place successful bets. The accessibility of financial spread betting coupled with the opportunity to gain high financial returns with little outlay means it is a viable form of trading for investors who wish the generate profit, regardless of whether markets are rising or falling.