The Allure of Spread Betting

Posted by adairsawyer on November 8th, 2011

Spread betting sounds very interesting, doesn't it?  It conjures up images of sports teams and guys sitting around in green eye-shades.  It can be a very exciting way to earn a good living as many people have done in the past several years; however, it is something that must be considered carefully before jumping into.  The participants involved in this activity will need to weight each decision to bet with an appropriate amount of informed thought.  So, what is spread betting? 

It is, quite simply, a bet - a bet that is placed through a spread betting company and identified as to whether it is a bet for a currency or other asset's value to go up or for that same thing to go down.  It is set up a little differently than it is for a stock exchange.  In other words, you could go long which means that you believe the asset will rise in value.  You could go short which, of course, means that you believe the asset will drop in value.   What is the spread part of spread betting? The question revolves around the amounts of the offers that the spread betting company is providing to you.

Let's say that the underlying asset of a particular commodity or currency is $100.00, right now.  The Spread betting company will have two offers.  They will offer something like:  $90.00  or $110.00.  (All of these numbers are nice and round, don't get used to that!)  You might 'buy' a position for $103.00, believing it will go up.  Let's further assume that you are placing that 'bet' with $10.00.  If, indeed that asset goes up, you are 'in the money' for $30.00!  (3 points X $10.00 = $30.00 = Big Spender!)  That really looks good on paper, doesn't it?  The same thing works the other way if you are 'selling' a position in the $90 to $100 spread.

When you are betting spread, you are really taking a lot of information that has to be considered about the underlying asset.  You need to know what the market conditions are for that particular asset and what is happening in the markets around that contract.  There is a lot to know and the use of a spread betting company is an appropriate safeguard against not having that information at your fingertips.

There are various special areas that you can concentrate on and various different spread betting strategies you could employ to try and ensure you do not lose, however, everyone does and it is not the end of the world!  One of the best ideas you could employ would surely be to engage a qualified spread betting company to partner with while learning this, potentially, very lucrative way of earning a living.  The many spread betting opportunities out there are certainly calling you as they have many others.  The sheer thrill of being able to make money this way will help when someone asks you: 'What is financial spread betting?' And you can actually tell them!

Binary Option Broker Guide can help and guide you through the spread betting maze! They are the spread betting company for you in more ways than one! Call them today.