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Casual Articles - Guide To Spread Betting
1. Trade links with other web sites. They should be related to the subject of your web site. Instead of trading links, you could also trade banner ads, half page ads, classified ads, etc.2. Start an e-zine for your web site. When people read each issue they'll be reminded to revisit your web site. They'll see your product ad more than just once which will increase your orders.3. Form an online community. It could be an online message board, e-mail discussion list or chat room. When people get involved in your community they will regularly return to communicate with others.4. Write articles and submit them to e-zines, web sites and magazines that accept article submissions. Include your business information and web address at the end of the article.5. Give away an electronic freebie with your ad on it. Allow your visitors to also give the freebie away. This'll increase your ad exposure and attract people to your web site at the same time.6. Combine your products or services into one big package deal with other businesses offerings. You could share a web site and advertise the package deal; which means double the traffic.7. Submit your freebie to the online directories that list your particular item or service for free. If you're offering a free e-zine, submit it to all the free e-zine directories on the internet.8. Participate on message boards. Post answers to other people's questions, ask questions and pos
Financial Incentives
We have already mentioned the tax benefits associated with spread betting but there are also other financial incentives. Spread betting firms charge no commission, there are no ECN fess and exchange fees do not apply. Spread bet firms make their money from the spread they charge. Therefore, the larger the spread the greater your cost to trade. If we take these firms at their word then they are constantly hedged in the market against their clients ‘overall’ positions. This means that they have no vested interest in seeing you make a loss because they are not on the other side of the bet. In fact they want to be profitable as it guarantees more bets (and the cost of spread) for them. A less optimistic view is that spread bet companies are no more than bookmakers and make their profit based on the fact that the majority of traders (and gamblers) lose money. This point will be discussed more in depth later on.
Trading Platforms
In order to make the spread betting experience as much like open market trading as pos
Credit card debt is a growing sickness in the United States and Europe. It is very important to eliminate debt and take control of your financial health.In the below section, I have listed the best strategy to erase credit card debt. This strategy is tried and true and often recommended by financial planners and debt consolidation firms. In an Excel spreadsheet list all your credit cards, balance, credit card interest rate and minimum payment from your most recent credit card statement. If you are not computer savvy, you can list them on paper.Sort the list in ascending order of interest rate so that the credit card with highest interest rate is at the top and the credit card with lowest interest rate is at the bottom.Make a count of minimum payment of all the credit cards in the list you just created.Now calculate how much money you can save to pay off your credit card debt and become debt free. If you cannot pay off more than the minimum payment, it is time to do some budgeting to save more and pay towards your credit cards.Each month pay off the minimum on all your credit cards. However, on the credit card with the highest interest rate, pay the minimum plus the additional amount you have saved to pay off your credit card debt.Continue to follow this strategy until the credit card with highest interest
This tutorial refers to financial spread betting. This means that we are talking about stock, index, future, forex, treasury, commodity and market sector spread bets. If you are looking for information about sporting spread bets then unfortunately this tutorial will be of no use to you.
Depending on your geographical location and the legal jurisdiction you fall under, spread betting may or may not be available to you. For example, gambling laws in the US may prohibit spread betting as it is classified in the same bracket as visiting a casino.
Spread betting has evolved in, and is dominated by, specialist UK firms. The concept was first introduced over 30 years ago when a bookmaker devised a way of betting on futures indices. The evolution has continued to the present day with greater competition for business creating an increase in financial products on offer and tighter spreads (the difference between the bid and the ask/ offer price). So why has spread betting taken off in the UK while it has remained relatively unheard of in other parts of the World? It is because UK tax laws class gambling (spread betting is classified as gambling, hence the name ‘bet’) as being free from capital gains tax. And as you never take physical ownership of any contacts or shares there is no stamp duty payable. This financial niche has been the major contributing factor to the growth in the spread betting market.
What is Financial Spread Betting?
In the simplest of terms, placing a spread bet means to put a ‘bet’ on a financial instrument moving higher or lower in value. Obviously the idea is to bet in the direction you think that the price will move. This method of speculation differs from the open market, as you will never physically own any security.
Spread betting is becoming increasingly popular with investors and traders alike for a number of reasons. In this tutorial we will do our best to show you how spread betting works, the similarities and differences with open market trading and the associated advantages and disadvantages.
Overview
Those with any experience of the financial markets will know the process of opening and closing a position on the open market. For example, if you were to purchase (or borrow in the case of shorting) shares your broker would quote you a price. Once you complete the transaction either by phone or electronically you would then take physical ownership of the shares (however share certificates are now held in street name). This process of opening a position is the same should you wish to place a spread bet. You can open bets by telephone or use the on-line 'trading' platforms provided to you when you open an account. The difference is that opening a spread bet position means that you trade or invest in any of the instruments offered to you without ever taking physical ownership of them. This is because, as we have already mentioned, you are merely putting a bet on the direction that you think they will move.
The fact that you never own a single share means that you forfeit any voting rights attached to the stock. It does not mean that you forfeit your right to a dividend payment however. Spread bet firms will adjust you position higher for a dividend payment (and mark it lower if a company goes ex dividend). At the time of writing it is not clear if this is an industry wide standard so it is worth checking with your chosen spread bet firm.
Shares vs. ? per Point
A fundamental difference in the way you place a spread bet as apposed to an open market order is the quantity you deal in. Rather than buying and selling no. of shares, you will be operating in GBP (?) per point. The definition of one ‘point’ depends on the spread bet firm in question but it is usually one pip in forex and one penny (UK) or one cent (US) for shares. We will go into detail in our examples section about how you can convert your position size from ?/ point to the equivalent of number of shares or contract size.
Shorting
If you have ever traded during a bear market or an IPO you will know that restrictions are placed on short positions. This is either because brokers have no shares left available for shorts (am many of their clients are already short) or the exchange has prohibited shorting. There are no such restrictions when it comes to spread betting. You are free to short (place a bet on price/ value falling) as often as you like and during any market conditions.
Available Markets
Although you will not find restrictions on your shorting activity there is a strong possibility of restrictions on the number of instruments available to bet on. If you specialise in penny shares, junk bonds or less liquid stocks you will more than likely find yourself frustrated. Most spread betting firms will offer you the opportunity to bet on mainstream indices (the DJIA, S&P 500, NASDAQ 100 and FTSE for example) and their member stocks. However, lower valued stocks are likely not to be offered. For example you will find yourself able to bet on the constituents of the NASDAQ 100 but members of the NASDAQ Composite are less frequently available.
Financial Incentives
We have already mentioned the tax benefits associated with spread betting but there are also other financial incentives. Spread betting firms charge no commission, there are no ECN fess and exchange fees do not apply. Spread bet firms make their money from the spread they charge. Therefore, the larger the spread the greater your cost to trade. If we take these firms at their word then they are constantly hedged in the market against their clients ‘overall’ positions. This means that they have no vested interest in seeing you make a loss because they are not on the other side of the bet. In fact they want to be profitable as it guarantees more bets (and the cost of spread) for them. A less optimistic view is that spread bet companies are no more than bookmakers and make their profit based on the fact that the majority of traders (and gamblers) lose money. This point will be discussed more in depth later on.
Trading Platforms
In order to make the spread betting experience as much like open market trading as poss
Ever had a sales person who spends most of their time internally trying to justify how great results are just right around the corner, spends a lot of time slicing and dicing their numbers and their forecasts and telling you over and over how an account is just about to close? Well those are the sales people who ain't going to make it. The best sales people are those who actually spend their time out selling and they're hard to pin down when it comes to the forecasts and numbers because they're so busy closing deals that they don't have time to report. The guy or the gal who spends a lot of their time analyzing and reporting and less time selling is the one that's in trouble and is fighting hard to sell internally to keep their job but not doing a good job of posting the numbers that you need from them.When that happens, confront the individual quickly and say “ I need to get you back out and producing results, I don't care about the exhaustive analysis, and frankly, I don't want to hear any more about these accounts that you've told me over and over about which aren't seeming to move.” So, if you've got a sales person like I've faced over my career, who are basically spending most of their time telling you how it's going to be in the future and that success is right around the corner, be suspicious. Tell them you don't want to hear it. Either get them to post the results or get them to move on down the road. By getting rid of or terminating people who are spendi
What is Financial Spread Betting?
In the simplest of terms, placing a spread bet means to put a ‘bet’ on a financial instrument moving higher or lower in value. Obviously the idea is to bet in the direction you think that the price will move. This method of speculation differs from the open market, as you will never physically own any security.
Spread betting is becoming increasingly popular with investors and traders alike for a number of reasons. In this tutorial we will do our best to show you how spread betting works, the similarities and differences with open market trading and the associated advantages and disadvantages.
Overview
Those with any experience of the financial markets will know the process of opening and closing a position on the open market. For example, if you were to purchase (or borrow in the case of shorting) shares your broker would quote you a price. Once you complete the transaction either by phone or electronically you would then take physical ownership of the shares (however share certificates are now held in street name). This process of opening a position is the same should you wish to place a spread bet. You can open bets by telephone or use the on-line 'trading' platforms provided to you when you open an account. The difference is that opening a spread bet position means that you trade or invest in any of the instruments offered to you without ever taking physical ownership of them. This is because, as we have already mentioned, you are merely putting a bet on the direction that you think they will move.
The fact that you never own a single share means that you forfeit any voting rights attached to the stock. It does not mean that you forfeit your right to a dividend payment however. Spread bet firms will adjust you position higher for a dividend payment (and mark it lower if a company goes ex dividend). At the time of writing it is not clear if this is an industry wide standard so it is worth checking with your chosen spread bet firm.
Shares vs. ? per Point
A fundamental difference in the way you place a spread bet as apposed to an open market order is the quantity you deal in. Rather than buying and selling no. of shares, you will be operating in GBP (?) per point. The definition of one ‘point’ depends on the spread bet firm in question but it is usually one pip in forex and one penny (UK) or one cent (US) for shares. We will go into detail in our examples section about how you can convert your position size from ?/ point to the equivalent of number of shares or contract size.
Shorting
If you have ever traded during a bear market or an IPO you will know that restrictions are placed on short positions. This is either because brokers have no shares left available for shorts (am many of their clients are already short) or the exchange has prohibited shorting. There are no such restrictions when it comes to spread betting. You are free to short (place a bet on price/ value falling) as often as you like and during any market conditions.
Available Markets
Although you will not find restrictions on your shorting activity there is a strong possibility of restrictions on the number of instruments available to bet on. If you specialise in penny shares, junk bonds or less liquid stocks you will more than likely find yourself frustrated. Most spread betting firms will offer you the opportunity to bet on mainstream indices (the DJIA, S&P 500, NASDAQ 100 and FTSE for example) and their member stocks. However, lower valued stocks are likely not to be offered. For example you will find yourself able to bet on the constituents of the NASDAQ 100 but members of the NASDAQ Composite are less frequently available.
Financial Incentives
We have already mentioned the tax benefits associated with spread betting but there are also other financial incentives. Spread betting firms charge no commission, there are no ECN fess and exchange fees do not apply. Spread bet firms make their money from the spread they charge. Therefore, the larger the spread the greater your cost to trade. If we take these firms at their word then they are constantly hedged in the market against their clients ‘overall’ positions. This means that they have no vested interest in seeing you make a loss because they are not on the other side of the bet. In fact they want to be profitable as it guarantees more bets (and the cost of spread) for them. A less optimistic view is that spread bet companies are no more than bookmakers and make their profit based on the fact that the majority of traders (and gamblers) lose money. This point will be discussed more in depth later on.
Trading Platforms
In order to make the spread betting experience as much like open market trading as pos
As an internet marketer, have you ever considered what segment of the population by age is your target market?Fair to most established marketers and gurus, it is widespread common knowledge that they teach a wide variety of marketing methods and techniques, chief of which is the need to identify a hot market product that can sell like crazy. And to do so, we go to extra effort to identify the products with the highest keyword searches and the least pages online, to get a competitive edge over other marketers who are selling online similar or equivalent products.But perhaps we have missed what can be the most lucrative market segment by age in the whole American market.Let me show you why.Firstly, there is a fixation by online marketers to push their products to the age group 18-to-34 years with the understanding that they are the younger set who are computer literate and can take to the internet and have little or no qualms about buying online.But consider this - The US Census Bureau indicates that 40% of the US population is 50 and older, and this group holds 75% of the nation's financial assets, and this same group did all 55% of all consumer spending!Indeed, the younger set of old are now the senior citizens, and many older internet users are getting more internet savvy to "trust" the internet and to buy something online. It is no surprise that a recent Nielsen survey showed a growth in this figure -27.4 million people aged 55 or ol
The fact that you never own a single share means that you forfeit any voting rights attached to the stock. It does not mean that you forfeit your right to a dividend payment however. Spread bet firms will adjust you position higher for a dividend payment (and mark it lower if a company goes ex dividend). At the time of writing it is not clear if this is an industry wide standard so it is worth checking with your chosen spread bet firm.
Shares vs. ? per Point
A fundamental difference in the way you place a spread bet as apposed to an open market order is the quantity you deal in. Rather than buying and selling no. of shares, you will be operating in GBP (?) per point. The definition of one ‘point’ depends on the spread bet firm in question but it is usually one pip in forex and one penny (UK) or one cent (US) for shares. We will go into detail in our examples section about how you can convert your position size from ?/ point to the equivalent of number of shares or contract size.
Shorting
If you have ever traded during a bear market or an IPO you will know that restrictions are placed on short positions. This is either because brokers have no shares left available for shorts (am many of their clients are already short) or the exchange has prohibited shorting. There are no such restrictions when it comes to spread betting. You are free to short (place a bet on price/ value falling) as often as you like and during any market conditions.
Available Markets
Although you will not find restrictions on your shorting activity there is a strong possibility of restrictions on the number of instruments available to bet on. If you specialise in penny shares, junk bonds or less liquid stocks you will more than likely find yourself frustrated. Most spread betting firms will offer you the opportunity to bet on mainstream indices (the DJIA, S&P 500, NASDAQ 100 and FTSE for example) and their member stocks. However, lower valued stocks are likely not to be offered. For example you will find yourself able to bet on the constituents of the NASDAQ 100 but members of the NASDAQ Composite are less frequently available.
Financial Incentives
We have already mentioned the tax benefits associated with spread betting but there are also other financial incentives. Spread betting firms charge no commission, there are no ECN fess and exchange fees do not apply. Spread bet firms make their money from the spread they charge. Therefore, the larger the spread the greater your cost to trade. If we take these firms at their word then they are constantly hedged in the market against their clients ‘overall’ positions. This means that they have no vested interest in seeing you make a loss because they are not on the other side of the bet. In fact they want to be profitable as it guarantees more bets (and the cost of spread) for them. A less optimistic view is that spread bet companies are no more than bookmakers and make their profit based on the fact that the majority of traders (and gamblers) lose money. This point will be discussed more in depth later on.
Trading Platforms
In order to make the spread betting experience as much like open market trading as pos
"The other part of outsourcing is this: it simply says where the work can be done outside better than it can be done inside, we should do it." ~~ Alphonso Jackson -- Secretary of United States Department of Housing and Urban DevelopmentPrecautions for Software OutsourcingSoftware outsourcing is definitely a feasible business solution for all types of industries. Software plays an fundamental part in many diverse industries and because software is continuously evolving and developing it isn't many times practical to engage an in-house software employee capable of meeting elaborate software needs. Companies may discover the power to outsource software projects while at the same time maintaining a reliable degree of profitability; that said, there are a few caveats to doing this. Software outsourcing is a sound business procedure but care ought to be taken to elude definite pitfalls repeatedly connected with software outsourcing. Taking a few precautions can stop the company from making mistakes when software outsourcing such as outsourcing the labor to people or companies who lack important qualifications, making lethal scheduling errors and paying too much money to outsource the work.Correctly Screening Software Outsourcing CandidatesOne of the most frequent mistakes made in software outsourcing is delegating the work to an person who lacks the imperative qualifications and capabilities to finish the job efficiently. Companies w
Shorting
If you have ever traded during a bear market or an IPO you will know that restrictions are placed on short positions. This is either because brokers have no shares left available for shorts (am many of their clients are already short) or the exchange has prohibited shorting. There are no such restrictions when it comes to spread betting. You are free to short (place a bet on price/ value falling) as often as you like and during any market conditions.
Available Markets
Although you will not find restrictions on your shorting activity there is a strong possibility of restrictions on the number of instruments available to bet on. If you specialise in penny shares, junk bonds or less liquid stocks you will more than likely find yourself frustrated. Most spread betting firms will offer you the opportunity to bet on mainstream indices (the DJIA, S&P 500, NASDAQ 100 and FTSE for example) and their member stocks. However, lower valued stocks are likely not to be offered. For example you will find yourself able to bet on the constituents of the NASDAQ 100 but members of the NASDAQ Composite are less frequently available.
Financial Incentives
We have already mentioned the tax benefits associated with spread betting but there are also other financial incentives. Spread betting firms charge no commission, there are no ECN fess and exchange fees do not apply. Spread bet firms make their money from the spread they charge. Therefore, the larger the spread the greater your cost to trade. If we take these firms at their word then they are constantly hedged in the market against their clients ‘overall’ positions. This means that they have no vested interest in seeing you make a loss because they are not on the other side of the bet. In fact they want to be profitable as it guarantees more bets (and the cost of spread) for them. A less optimistic view is that spread bet companies are no more than bookmakers and make their profit based on the fact that the majority of traders (and gamblers) lose money. This point will be discussed more in depth later on.
Trading Platforms
In order to make the spread betting experience as much like open market trading as pos
The best bit of advice you can offer anyone going for a finance job interview is to be prepared. The time you put into preparation will have a direct relationship with how well you perform in the interview and how likely you are to get the job.Firstly, find out as much about the company as you can in advance. The more you know about the potential employer the better. You can never know too much and it will help in two ways. You will show you are an observant individual with an outwardly looking understanding of the industry and the knowledge you have learnt will show you know what you are talking about. Secondly it will also show that you have researched the company. This time commitment of the research also shows how keen you are on the position. Any recruiter is always going to appreciate pro-active candidates who show that they are keen to get the job.Think in advance what questions they are likely to ask. Many financial job interviews follow a similar pattern, so think ahead about what they might ask. Draw up a mind map using both you CV and the job advertisement to decide topics. You won’t need scripted answers but the more time you have to think about answers the more likely you answer is to be what they are looking for. A few bullet points will give you a head start over the other less well prepared candidates.Visualise your success. You can never underestimate the power of positive thinking. The worst that can come out of a financial job interview
Financial Incentives
We have already mentioned the tax benefits associated with spread betting but there are also other financial incentives. Spread betting firms charge no commission, there are no ECN fess and exchange fees do not apply. Spread bet firms make their money from the spread they charge. Therefore, the larger the spread the greater your cost to trade. If we take these firms at their word then they are constantly hedged in the market against their clients ‘overall’ positions. This means that they have no vested interest in seeing you make a loss because they are not on the other side of the bet. In fact they want to be profitable as it guarantees more bets (and the cost of spread) for them. A less optimistic view is that spread bet companies are no more than bookmakers and make their profit based on the fact that the majority of traders (and gamblers) lose money. This point will be discussed more in depth later on.
Trading Platforms
In order to make the spread betting experience as much like open market trading as possible, spread bet firms have invested heavily in their online trading platforms. These programs include live streaming quotes, free live charts (including technical indicators suitable for all but the most advanced technical traders), news wires and order tickets featuring stop, limit, OCO, market and CRB (controlled risk bets that act as a guaranteed stop loss) orders. These platforms are provided at no extra cost when you open your account, however features will vary depending on your provider.
Live Prices
The live streaming quotes are not fixed in order to catch you out while betting. All quotes are based on the current market price. The only difference is the spread as the spread bet firms are free to set this themselves. As we have mentioned this is their primary source of income and you may find spreads are a little wider than you will find in the open market. However, competition for your custom has been increasing rapidly and you will find that the spreads on offer are very competitive.
Margin Requirements
Spread betting affords traders a much lower margin requirement than typical share dealing accounts. For example, SEC rules stipulate that brokers inside the US may only provide leverage of 4:1 (25% margin) on accounts over $25 000. This means that in order to command positions worth $100 000 you must have a minimum of $25 000 in your account. With spread betting firms the margin requirement is much lower. One leading spread bet firm requires you to provide 5% margin for US share bets. Using the same example a $100 000 position would only require $5 000 account balance. Of course this position would be calculated in ? per point and not dollars. The relaxed margin requirements allow traders to command much larger positions with their available account balance. In theory this means a trader can achieve a much higher return on capital but must do so by accepting much higher risk.
How Does it Work? – Examples
As we have already mentioned, spread bets are denominated in ? and points rather than number of shares. This difference may be confusing but with a simple equation you can convert the ? per point trades size to the equivalent number of shares. For this example we will be using Vodafone (UK), VOD. It is currently trading at 116.00 / 25 pence. The spread, as quoted by your spread bet firm is currently 0.25 pence, or a quarter of one point. You wish to buy the equivalent of 100 shares of VOD. You have a target of 146 pence. If you were to buy 100 shares on the open market it would cost you 116.25 multiplied by 100 = 11625 pence or ?116.25. Every penny the share moves will alter the value of your position by ?1 (1penny * 100 shares = ?1). Therefore ?1 per point will give you the equivalent of 100 shares. This is the same for all share bets, including US shares because spread bet firms denominate US shares in points and the number of pounds you bet per point move.
Gambling vs Trading
The name spread betting automatically conjures up thoughts of gambling due to the word ‘bet’. This is confirmed by the UK government who have classed any profits made in a spread betting account as being free from capital gains tax. However, no trading or investing decision ever includes thoughts of gambling. This should also be true for any one hoping to venture into spread betting. In truth we should refer to 'spread betting' as 'spread trading'. The system has been set up to mimic open market trading as closely as possible and therefore lends itself to the same profitable strategies used in the open market. Strict risk reward and discipline are key. The same price movements, technical criteria or fundamentals exist; you are simply acting on your strategy through a different medium.
Without venturing too far into strategy building and implementation, it must be remembered that the smaller margin requirements, especially for stocks, must be incorporated into the risk factor of each trade.
Summary
For any trader looking to investigate the possibilities of spread betting there are certainly benefits and detriments to consider. Indeed it may not even be possible for many as gambling laws prohibit the use of spread betting accounts.
The potential for increased risk is one such consideration. The spread bet firms are keen to illustrate the fact that a smaller margin requirement can lead to massive return on your account balance through superior leverage. However, in truth this extra leverage may not be needed, as a successful strategy will not increase the risk placed on a trade just because it is possible. This makes the benefit of increased leverage almost obsolete unless you wish to be able to maintain your positions with a smaller account balance, thus freeing up funds for other investments.
On the other hand, any profits made through spread betting are currently classed as tax free (tax laws can change). The profit saved thanks to this lack of tax is a heavy consideration for most,
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