Spread betting – Binary Options, spread betting
There are many countries which are well known for their betting and winnings which are totally tax free. Thus we find Spread betting quite prevalent in UK but not in US, where they do not have the same regulations like the UK. This works as a part of the binary options that you opt for. Suppose you have placed a bet on the FTSE for 5, and then you as a trader is paid whatever the increase is beyond the broker’s purchase price. The broker here quotes a price which is known to you, thereby when the index moves, and you gain, as a result.
The biggest advantage of Spread betting is that a trader who does not have much of capital to invest would be able to work on it. One can spread bet with a futures broker who bets with at least a particular figure so as to be able to hold multiple positions in the stock market, and keeping a comfortable margin as well. Spread betting as mentioned earlier can be done with small amounts – in fact as small as 1000. Spread betting is a part of the Binary options which also has gained popularity because all kinds of brokers can operate and reap benefits out of it.
This form of binary options works on the traders own decision and not on the broker’s advise, though advise can be taken on CFDs. The simplest of financial tools that one can use out of binary trading is spread betting. The bets are done on prices, above or below the underlying assets would go to. The spread betting can be done on all kinds of stocks – be it indices, foreign currency or stocks. The only thing that you need to do is either choose a up or a down and at a particular date and time, and then just wait and watch as to whether your judgment was right or wrong. Binary options are the simplest of the tools that a trader can start with and what could be a better way than to start with spread betting.