1. About Indices Spread Betting
The most popular spread betting markets are the Stock Market Indices. These indices represent the combined value of some of the largest companies in the world.
The FTSE 100 Index is the basis for the most popular spread betting market in the UK. The FTSE 100 includes the likes of energies companies BP and Shell as well as banks like HSBC and Barclays.
By spread betting on the FTSE 100 to go up or down you are speculating on the aggregate movement of all of the stocks listed in the index. A wide understanding of the markets is required owing to the variety of industries that are often represented.
Having said that, Indices can make interesting trading given the nature of the markets, for example, in 2009 the large mining companies and financial institutions have heavily influenced the direction the FTSE 100. So-called ‘defensive’ pharmaceuticals shares such as GlaxoSmithKline and Reckitt Benckiser have been less volatile and had less impact on the FTSE 100.
Some of the most popular indices markets include:
- FTSE 100 – a share index that highlights the performance of the top 100 UK listed companies, as ranked by their market capitalisation. This index is also known in spread betting as the UK 100
- German DAX 30 – a share index of Germany's top 30 companies in terms of order book volume and market capitalisation
- Dow Jones – a share index that reflects the performance of the top 30 American stocks. Also known in spread betting as ‘Wall Street’
- US S&P 500 – a share index that defines the broader US equity market by tracking the performance of the top 500 American stocks
- French CAC 40 - a share index of the 40 largest companies listed on Euronext Paris, the largest French stock exchange
- Japanese Nikkei 225 - Refers to the price-weighted average of the top 225 stocks in the Tokyo Stock Exchange
Spread betting on stock market indices allows an investor to go long, or short. So if, after your research, you believe that the combined value of the companies will decrease then you can spread bet on the Index to go down. Naturally, you can also spread bet on it to go up.
However, spread betting on indices is a leveraged form of trading and so whilst this increases your potential upside you can also lose more than your initial stake. This means that you should be fully aware of the potential benefits and pitfalls before placing any trades.
It should also be noted that spread trading indices is currently a tax free method of trading*.
If you are looking to trade individual equities, see Share Spread Betting.
More on specific Spread Betting Indices:
2. Where can I Financial Spread Bet on Indices?
| |
 |
 |
 |
 |
 |
 |
 |
 |
 |
| FTSE 100 Daily |
 |
|
|
|
|
|
|
|
|
| FTSE 100 Future |
|
|
|
|
|
|
|
|
|
| Wall Street (Dow) Daily |
|
|
|
|
|
|
|
|
|
| Wall Street (Dow) Future |
|
|
|
|
|
|
|
|
|
| DAX 30 Daily |
|
|
|
|
|
|
|
|
|
| DAX 30 Future |
|
|
|
|
|
|
|
|
|
| S&P 500 Daily |
|
|
|
|
|
|
|
|
|
| S&P 500 Future |
|
|
|
|
|
|
|
|
|
| Other Indices |
|
|
|
|
|
|
|
|
|
The above spread betting markets may also be available with other companies. Also see Comparison Table Notes.
3. How to Spread Bet on Indices
Like many financial markets, you can spread bet on the future value of Indices, ie you can spread bet on Indices like the FTSE 100, Dax 30, Dow 30 etc to go up or down.
At the time of publication, the FTSE 100 Index (December) market is trading at 4680 - 4684 with Financial Spreads.
With this FTSE 100 (December) market, which closes on 18-Dec-09, you can financial spread bet on:
a) The FTSE 100 to finish higher than 4684 on 18-Dec-09, or
b) The FTSE 100 to finish lower than 4680 on 18-Dec-09.
When you trade the FTSE 100 you trade in £X per point, where a point is 1 point of the FTSE 100. Eg if your stake was £3 per point and the FTSE moves 30 points then that would be a £90 difference to your profit / loss.
FTSE 100 Spread Betting Example
Eg, let's say you see the live price on Financial Spreads and it gives the spread of 4680 – 4684. Let’s also say that you think that the Index will settle above 4684 on the closing date. If this were to happen then:
- You feel that the FTSE 100 will go up
- You 'buy' the FTSE 100 at 4684 and you invest £2 per point
- The market increases
- Let’s say the market settles at 4720
- Price you bought the spread at 4684
- Profit and loss = (closing level - opening price) x stake per point
- Profit and loss = (4720 - 4684) x £2 per point stake
- Profit and loss = 36 x £2 per point stake
- Profit and loss = £72
Of course, if the market did not move as you predicted and had the FTSE 100 gone down, and closed at a lower than expected level of 4650, you would have lost.
- Opening price = 4684
- Profit and loss = (closing price - opening price) x stake per point
- Profit and loss = (4650 - 4684) x £2 per point stake
- Profit and loss = -34 x £2 per point stake
- Profit and loss = -£68
(Prices quoted as of 19-Aug-09).
4. Where can I find Real-Time Indices Spread Betting Prices?
All of the above companies provide access to real-time indices prices to their account holders.
Note that you may need to log into your account in order to see the live Indices prices.
Advert
www.FinancialSpreads.com Narrow Spreads, Free Charts and Live Prices.
No Fees, No Commissions, Spread Bet on Shares, Indices, Forex, Commodities Apply Now.
|
5. Where can I find Indices Candlestick Charts?
A number of the spread betting companies offer a variety of charts, including candlestick charts. Note that you may need to open an account with the respective company in order to see the charts and/or have full access to real-time charts that you can manipulate. Spread betting accounts are subject to status, terms and conditions.
Candlestick charts are currently available with:
Charts may also be available from other spread betting companies.
Example indices charts from Financial Spreads:
Advert
www.FinancialSpreads.com Narrow Spreads, Free Charts and Live Prices.
No Fees, No Commissions, Spread Bet on Shares, Indices, Forex, Commodities Apply Now.
|
"Spread Betting on Indices" last update by R Thomas, 20-Mar-2010
Warning: Financial spread betting carries a high level of risk. You can lose more than your initial investment or stake. Financial spread betting may not be suitable for all investors. Only trade with money that you can afford to lose. Make sure you fully understand the risk involved. If necessary, seek independent financial advice.
Similar articles:
FTSE Spread Betting - last update: 20-Mar-2010
How to spread bet on Indices like the FTSE 100, where to trade the FTSE, Wall St, Dax and >> read in full.
Index Spread Betting - last update: 20-Mar-2010
Index Spread Betting - With spread betting the most popular trade is the Index spread bet. An important feature in fast moving, volatile markets, such as the stock market indices, is that >> read in full.
Spread Betting on Indices - last update: 20-Mar-2010
How and where to spread bet on Indices. Also where to find candlestick charts for stock market indices like the FTSE 100, Dow Jones and >> read in full.
Spread Bets and the Dax 30 - last update: 15-Mar-2010
How and where to spread bet on Dax 30 >> read in full.
Spread Bets and Wall St - last update: 15-Mar-2010
How and where to spread bet on Wall Street >> read in full.
Spread Bets and the Nikkei - last update: 15-Mar-2010
How to spread on the Nikkei plus where you can trade the Nikkei with no brokers fees or commissions >> read in full.
Spread Bets and S&P 500 - last update: 15-Mar-2010
Where and how to spread bet on the S&P 500 plus where you can trade the S&P 500 with no brokers fees or commissions >> read in full.
Spread Bets and the Dow Jones - last update: 15-Mar-2010
How and where to spread bet on the Dow Jones plus where you can trade the Dow Jones with no brokers fees or commissions >> read in full.
Spread Bets and the CAC 40 - last update: 15-Mar-2010
How to spread bet on the CAC 40 plus where you can trade the CAC 40 with no brokers fees or commissions >> read in full.
Spread Betting on the AEX - last update: 16-Mar-2010
How to spread bet on the AEX plus where you can trade the AEX with no brokers fees or commissions and >> read in full.
Spread Betting on the Euro Stoxx - last update: 16-Mar-2010
How to spread bet on the Euro Stoxx plus where you can trade the Euro Stoxx with no brokers fees or commissions and >> read in full.
Spread Betting on the Nasdaq - last update: 16-Mar-2010
How to spread bet on the Nasdaq plus where you can trade the Nasdaq with no brokers fees or commissions and >> read in full.
Spread Betting on the Nifty 50 - last update: 16-Mar-2010
How to spread bet on the Nifty 50 plus where you can trade the Nifty 50 with no brokers fees or commissions and >> read in full.
Spread Betting on the UK 100 - last update: 16-Mar-2010
How to spread bet on the UK 100 plus where you can trade the UK 100 with no brokers fees or commissions and >> read in full.
Spread Betting on the Australia 200 - last update: 16-Mar-2010
How to spread bet on the Australia 200 plus where you can trade the Australia 200 with no brokers fees or commissions and >> read in full.
Spread Betting on the Hang Seng - last update: 16-Mar-2010
How to spread bet on the Hang Seng plus where you can trade the Hang Seng with no brokers fees or commissions and >> read in full.
Spread Betting on the Ireland ISEQ 20 - last update: 16-Mar-2010
How to spread bet on the Ireland ISEQ 20 plus where you can trade the Ireland ISEQ 20 with no brokers fees or commissions and >> read in full.
FTSE Spread Betting Facts - last update: 15-Mar-2010
All financial markets can be affected by rumour, just ask HBOS who saw their share price drop 18% on unfounded hear say. If you are looking to trade the FTSE 100 what are the facts? >> read in full.
FTSE Spread Betting Tools - last update: 15-Mar-2010
The FTSE 100 is experiencing large price changes with 50+ point swings on a daily basis and a 400 point drop in June. The key question is: How to make money by spread betting on the FTSE 100? A good place to start is to make sure you are trading with as few costs and as much real >> read in full.
FTSE 100 Spread Betting Protection - last update: 15-Mar-2010
There are a large number of opportunities to profit from trading Indices like the FTSE 100 but what about a little protection. With each potential profit there is a potential loss. Here are four important spread betting tips to >> read in full.
Sterling and Europe - last update: 05-Feb-2009
For longer term equity holders we are also running into the 'aging population' effect. A greater and greater percentage of the populace is tipping over retirement age which generally means equity redemptions rather than equity purchases. The up and coming generations may have >> read in full.
Spread Betting on the FTSE in 2009 - last update: 29-Jan-2009
We are still in a bear market whether anyone likes it or not and the bounce from the November 2008 lows lasted 30 days in total. That happens to be the average length of time that bear market rallies last. Technically the bears are still in control and from a fundamental standpoint the >> read in full.
FTSE 100 Spread Betting Surprise - last update: 29-Jan-2009
With optimism so low, are there any benefits for traders out there looking to buy and/or sell the markets? By mid-January 2009, the market volatility of 2008 had returned and for anyone spread betting by trading ranges there was, and still is, money to be made. Of course you >> read in full.
Selling the FTSE 100 - last update: 19-Sep-2008
Selling the FTSE 100 >> Looking on a long-term basis the FTSE 100 has not moved much. It is not far away from the level it was at back in 1997. Do not forget the FTSE is not a like for like comparison. It continually >> read in full.
|
|
|
Free Financial Email: Latest Spread Betting Offers and where to find narrow spreads.
Click here to sign up.
|
|
