Financial Spread Betting

What is Financial Spread Betting

Financial Spread Betting lets you bet on whether you think the value of financial product or market will rise or fall and you specify an amount you want to bet on each point movement. Learn more about Financial Spread Betting at our tailored website.

You don't actually buy the financial product or market you agree to exchange the difference between the opening and closing value of your bet but pay a margin, which is a deposit of the overall value of the trade (typically 10%). This means you can make a much larger position than if you're paying for the full value of the financial product or market. However, profits and losses are magnified in exactly the same way. Your profit or loss is the difference between the opening price and closing price of your bet multiplied by the amount you're specified per point movement.

There is no fixed expiry date for a CFD trade, the trader closes the trade when they wish to either collect their profits of cut their losses.

Financial Spread betting is a derivative product. A derivative is a financial product whose value is derived from the value of an underlying security, index, commodity or rate. It is a financial contract between a trader and a provider to exchange future cash flows.

Who is Financial Spread Betting for?

Financial Spread Betting carries a very high level of risk and it is not for everyone. Financial Spread Betting requires you to understand the concept of gearing and the effect this can have on returns. Seeking independent advice if necessary.

What does Financial Spread Betting cost?

TD Waterhouse Financial Spread Betting Service does not charge a commission per bet because our money is made from the spread that is offered on the value of the financial product or market. The spread is the difference between the buying and selling price of a financial product or market.

How Financial Spread Betting works

If you think the financial product or market will rise in value you may want to buy it and go 'long'. If your prediction is correct you can sell to make a profit, which is the movement in price multiplies by the amount you specified per price movement (your stake). If you are incorrect and the value falls you would make a loss.

If you think the financial product or market will fall in value you may wish to sell and go 'short'. If you are correct you can buy back at a lower price to make a profit that being the movement in price multiplies by your stake. If you are incorrect and the value rises you would make a loss.

Financial spread betting carries high risk, it is possible to quickly lose more money than your initial deposit and you may be required to make further deposits at short notice. Financial spread betting is not for everyone so please ensure you understand the risks.

TD Waterhouse Financial Spread Betting is a trading name of City Index Limited (CI), who is a provider of financial spread betting and whose head and registered office is Moorgate Hall, 155 Moorgate, London, EC2M 6XB. For the purposes of financial spread betting any contract is between you and CI and all dealing, administration and settlement is carried out by them and TD Waterhouse Investor Services (Europe) Limited are not responsible for any of the functions they perform. Your account is held with City Index Limited (CI), which is authorised and regulated by The Financial Services Authority (FSA Registered Number: 113942).