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10 Best Spread Betting Platforms and Brokers for 2024

Spread betting allows traders to profit from fluctuations in the value of an underlying asset, even if they do not own the underlying asset. This is an exciting way to potentially make good profits from rising and falling prices.

Just as traders need a broker to invest money in the stock market, to make money from spread betting, traders also need a broker that allows traders to trade with leverage and enables short selling in their preferred markets. These allow you to speculate on the price of stock, index, commodity, forex, and fixed-income markets.

In this post, we have ranked, compared, and reviewed some of the best spread betting brokers in the world to help you choose the account that best suits your trading strategy. We evaluated them according to criteria such as platform options, cost, regulatory compliance, and instructional resources.

List of the Top 10 Spread Betting Platforms in 2024

Spread Betting BrokerMinimum DepositEURUSD typical spreadLeverageRegulation
Pepperstone£00.09 pips1:30FCA, ASIC, DFSA
FxPro£1000.5 pips1:500FCA
AVA TRADE£1000.9 pips1:30ASIC, FSCA, FSA
Vantage£500.7 pips1:30FCA, ASIC, VFSC
CMC Markets£00.5 pips1:30FCA, ASIC, FMA, MAS
CITY INDEX£1000.07 pips1:30FCA, ASIC, MAS
IG£00.16 pips1:30 FCA, ASIC, CFTC
SPREADEX£00.841:30 FCA
markets.com£1000.7 pips1:300FCA, CySEC, and FSCA
FXCM£500.3 pips1:30`FCA, CySEC, and ASIC
  • Minimum Deposit: £0
  • Leverage: 1:30
  • Fees: 0% commission on spread betting accounts
  • Regulation: FCA, ASIC, DFSA
  • Pepperstone
    Pepperstone

    Pros and Cons

    Fees

    Trading Assets

    Review

  • Minimum Deposit: £100
  • Leverage: 1:500
  • Fees: 0% commission on spread betting accounts
  • Regulation: FCA
  • Pros and Cons

    Fees

    Trading Assets

    Review

  • Minimum Deposit: £100
  • Leverage: 1:30
  • Fees: 0% commission, spreads vary depending on the market
  • Regulation: ASIC, FSCA, FSA
  • AVA TRADE
    AVA TRADE

    Pros and Cons

    Fees

    Trading Assets

    Review

  • Minimum Deposit: £50
  • Leverage: 1:30
  • Fees: 0% commission, spreads vary depending on the market
  • Regulation: FCA, ASIC and VFSC
  • Pros and Cons

    Fees

    Trading Assets

    Review

  • Minimum Deposit: £0
  • Leverage: Up to 1:30
  • Fees: 0% commission, spreads vary depending on the market
  • Regulation: FCA, ASIC, FMA, and MAS
  • CMC Markets
    CMC Markets

    Pros and Cons

    Fees

    Trading Assets

    Review

  • Minimum Deposit: £100
  • Leverage: 1:30
  • Fees: 0% commission, spreads vary depending on the market
  • Regulation: FCA, ASIC, and MAS
  • CITY INDEX
    CITY INDEX

    Pros and Cons

    Fees

    Trading Assets

    Review

    • Minimum Deposit: £0
    • Leverage: 1:30 for retail traders, 1:200 for professional traders
    • Fees:
      • Spread betting is charged on a spread-only basis.
      • The spread on shares is based on a percentage. Basis points are used to quote other assets.
    • Regulation: FCA, ASIC, CFTC

    Pros and Cons

    Fees

    Trading Assets

    Review

    • Minimum Deposit: £0
    • Leverage: 1:30
    • Fees
      • Spread-only markets that vary depending on the instrument
      • When a position is closed, the majority of markets do not attract a spread.
    • Regulation: FCA

    Pros and Cons

    Fees

    Trading Assets

    Review

  • Minimum Deposit: £100
  • Leverage: 1:300
  • Fees: Spread-only markets. Spreads are variable and vary depending on the asset
  • Regulation: FCA, CySEC, and FSCA
  • markets.com
    markets.com

    Pros and Cons

    Fees

    Trading Assets

    Review

  • Minimum Deposit: £50
  • Leverage: 1:30
  • Fees: No commissions, spread bet on a spread-only basis
  • Regulation: FCA, CySEC, and ASIC
  • Pros and Cons

    Fees

    Trading Assets

    Review

    What is spread betting?

    Spread betting is a financial derivative technique by which investors can speculate on price movements in various financial markets, such as indices, stocks, currencies, and commodities, without purchasing the underlying asset.

    As the name suggests, it is a bet, not an investment. If the trader believes the price of an asset will climb, he places a bet to ‘purchase’ it. At the same time, if he believes the price of an asset will fall, he bets on selling it.

    Thus, spread betting enables traders to profit from both rising and declining markets. The degree of fluctuation in the asset’s value and the accuracy of the trader’s predictions are used to establish the spread betting profit or loss.

    In this approach, the accuracy of the forecast increases the probability of profit. However, if the market moves contrary to the trader’s position, losses may exceed the trader’s initial investment.

    What is Spread?

    In spread betting, the “spread” is the difference between the buy (bid) and sell (ask) prices of an asset.

    Important Note: Despite its American origins, spread betting is illegal in the United States.

    Benefits and Limitations of Spread Betting

    Benefits of Spread Betting

    • Profit potential in rising and falling markets: Spread betting allows traders to make profits in both rising and falling financial markets.
    • Leverage: Margin trading is a common practice in spread betting, which enables traders to manage large holdings with comparatively little capital. Profits can be increased by leverage, resulting in larger returns on investment.
    • No commissions: Spread betting providers make money from the spreads they offer and do not charge any separate commissions, making it easier for investors to track trading costs and determine their position size.
    • Tax benefits (in some jurisdictions): In some areas, such as the UK, profits from spread betting are often exempt from capital gains tax, which can increase net returns for profitable traders.

    Limitations of Spread Betting

    • High Risk: Spread betting is a high-risk trade with the potential to lose more than the money you initially invested. This is because spread betting also uses leverage, and leverage increases both profits and losses. Traders who use leverage to secure their positions are always at risk of incurring significant losses.
    • Volatility and Market Uncertainty: Financial markets are extremely unpredictable and volatile, making it difficult to predict price movements with accuracy. Unforeseen circumstances or sudden market fluctuations can result in significant losses for spread speculators.
    • Wide Spreads: During times of instability, spread betting companies may widen their spread. This can result in stop-loss orders and increased trading fees.
    • Costs and other fees: Spreads, or the difference between buy and sell prices, are usually charged by spread betting providers along with additional costs, which can reduce profits, especially for regular traders. Additionally, overnight funding charges may also be imposed on positions held overnight.

    How do I place a bet?

    If you want to engage in spread betting, you need to follow the following steps:

    Open a Trading Account

    First of all, you will need an account. You will use your account to open positions, research new opportunities, add funds, and monitor your profits or losses.

    Choose a Market

    Once the account is opened, you will decide which markets you want to trade. Spread betting allows you to speculate on a wide range of assets, including stocks, indices, currencies, commodities, and more.

    Decide to buy or sell.

    Spread betting allows you to open your position by either purchasing or selling a market. Click ‘buy’ if you think the price will increase in value, or ‘ sell’ if you think the price will fall in value.

    Set your spread bet stake size.

    You then need to choose how many pounds you want to wager per point. The size of your stake determines how much you make or lose per point in your chosen market.

    You should understand that a stake of £10 means that you will win or lose £10 for every point that the market rises or falls in your favor.

    Stake size and spread

    Once you choose your stake, you can multiply it by the market spread to calculate how much you will pay to open your position. For example, if the spread is 1.2 points and you are betting £2 per point, you will pay £2.40 for the trade.

    Stake Size and Margin

    As we already mentioned, spread betting is a leveraged product, which means you only need to have a fraction of the total value of the trade-in your account to open it. The amount of money you have to keep in your account is called your margin.

    For example, let’s say the UK 100 is trading at 7,953 and has a 5% margin requirement, and you want to bet £3 per point, giving you a total position size of 7,953 x £3 = £23,859. But because spread betting is leveraged, you only need 5% of this in your account, which comes to £1,192.95.

    The higher your stake, the more margin you need in your account to trade. If you want to get £5 per point, you will need (7,953 x 5% of 5) = £1,988.25.

    Here, you always have to ensure that you always have enough margin in your account to open trades.

    Margin in Spread Betting
    Margin in Spread Betting

    Place a stop-loss to manage the risk of spread betting.

    Ultimately, before entering the market, it is important to consider how you will manage your risk. As we mentioned above, spread betting is a high-risk trade with the potential to lose more than the money you initially invested. This is because spread betting uses leverage, and leverage amplifies both profits and losses.

    Therefore, you must have a strategy for risk management. There is no way to eliminate risk, but you can reduce your risk by using some tools and strategies. These strategies and tools are as follows:

    • Stop-loss order
    • Limit orders

    Adding a stop or limit to your position will automatically close your trade when it reaches a certain level; a stop-loss order can minimize your potential losses, while a limit-close order helps lock in any profits. Can help.

    Stop-loss order

    Stop-loss is an order or instruction to automatically close your position at a certain price.

    It is widely used by traders to minimize losses. Once a position reaches a set level of loss, a stop-loss order automatically closes it.

    What will be the level of this loss? The traders themselves decide according to their risk appetite and then place a stop-loss order at that point so that their loss does not exceed that certain limit.

    Spread Betting Stop Loss Order
    Spread Betting Stop Loss Order

    You can see the working pattern of stop loss in the above graphical representation. When prices fall below a specified price that is worse than the current market level, a stop-loss order automatically closes the trader’s position. Due to this, he avoids much loss.

    If the stop-loss order had not been placed, the trader could have suffered huge losses.

    Limit order

    Another tool used in spread betting is called a limit order, also known as a take-profit order. This order closes the trade at a price better than the current market level.

    A limit order is the exact opposite of a stop-loss order. Stop-loss orders close a position when a position reaches a specified level of loss; on the other hand, when a position reaches a specified level of profit, a limit order automatically closes the position.

    These tools don’t need to help you protect yourself from loss, but these benefits prove useful in achieving the goal.

    Let us take an example to understand it better. Let’s say the UK 100 reaches your profit target of £7,950, but you were not tracking the market at this time, so you are unable to exit your position, and the UK 100 falls to £7,600.

    In this example, if you had placed a limit order at £7,950, your position would have been automatically closed there, and you would have made the assured predetermined profit.

    Adding Limits Order In Spread Betting
    Adding Limits Order In Spread Betting

    Execute, monitor, and close your trades.

    Once your position is opened, you will see your profit or loss updated in real-time. To exit your trade, you click the “Close Trade” button.

    There are two main ways to open your position: Using market orders or opening orders.

    1. Market Order: A market order is executed at the best available price. If you want to open your position at the current market price, this is the easiest option.
    2. Open Order: If you want to execute your trade at a specified level instead of the current price, you can use an open order. These work similarly to stops and limits, but they open a position instead of closing it.

    How to monitor your spread bets

    Your profits and losses align with market movements. Every movement in the market has a direct impact on your profits and losses. So you keep monitoring all your open trades, whether you have stop-loss orders or limit orders.

    But this also does not mean that you keep looking at the same thing all the time. It would be better if you used a tool like Price Alert for this. Price alerts let you know when your market reaches specific levels or experiences extreme volatility.

    You can also track your trades in the ‘Open Positions’ section of your trading platform.

    Close down your business.

    When you are willing to close your position, you should place a bet in the opposite direction from where you opened it. If you bought at the beginning, you will sell now.

    For this, select the ‘Closed Status’ option in the status window. Upon closing the trade, your net open profits and losses will be realized and immediately reflected in the cash balance of your account.

    If your stop-loss or limit order is automatically triggered, this will be done for you. Of course, your stop loss will be canceled if you close your position manually.

    Spread betting examples and calculators

    When you place spread bets in your selected market, it is important to understand how much capital you are putting at risk. The calculation for this is as follows:

    Capital at risk = bet size x market value (in points)

    When you place a bet, the market value is displayed in points.
    For example, if you were trading a Forex pair, instead of a price of ‘1.13220’, you would see a price of ‘11322.0’. So, trading £10 worth per activity point would mean you are putting a total of £113,220 at risk (11322.0 x 10).

    Another important aspect of spread betting is leverage. Since spread betting is a leveraged product, you will only need to cover the margin as opposed to the full value of the trade. Spread betting calculations for margin are as follows:

    Margin = Margin Factor x Total Exposure

    When we consider the above example in this scenario and assume that the margin factor was 3.33%, you would only need to put in £3770.226 (3.33% x £113,220) to open the trade.

    As we mentioned earlier, leverage can potentially increase your profits and losses, as they are calculated using the full size of your trade—in this case, £113,220—and not just margin.

    To understand how spread betting works, let us use some examples:

    How to bet on stocks: examples

    To understand how to bet on the shares, let us take the example of Standard Chartered PLC, which is currently trading at £703.25. If there was a one-point spread, you would be presented with a buy price of £703.75 and a sell price of £702.75.

    You open a long spread bet position on Standard Chartered PLC, buying at £703.75 at £10 per movement. If the margin requirement for Standard Chartered PLC shares is 20%, you will need to deposit £1,407.50 (£10 x 703.75 x 20%).

    If your spread bet on shares was correct,

    Let’s say Standard Chartered PLC shares rose to £723.75. You could decide to close your position to take your profit.

    You will close the spread bet position at the new sell price of £723.25. Since the market has moved 19.5 points in your favor (£723.25-£703.75), your profit will be £195 (19.5 x £10).

    Here, you will not have to pay any tax on your profits. However, you will have to pay a funding fee to keep your position open overnight.

    If your bet on the spread of shares was wrong,

    However, assuming Standard Chartered PLC shares fell to £703.25, there would be a new selling price of £702.75. Since the market has moved against you by 21 points (£702.75-£723.75), you will lose £210 (21 x £10) plus any further funding expenses.

    How to Bet on Indices: Examples

    To understand how to bet on indices, we will take the example of the UK 100. The FTSE 100 is currently trading at 7,952.62.

    The prices of bets in spreads are always quoted in pairs, meaning the selling price (bid) and the buying price (offer). The difference between these is known as the spread.

    In this scenario, the selling price of the UK 100 is £7,952.62, and the buy price is £7,953.82, so the spread is 1.2 points (£7,952.62 – £7,953.82).

    Here, you decide to buy the UK 100 at £5 per point if you think the FTSE 100 is going to rise. This is known as going long, and it means that for each point the index rises, you will make a profit of £5. And if it falls, you’ll lose £5 per point.

    This is a long position, so you buy the UK100 at £7,952.62.

    Going Long on the UK 100
    Going Long on the UK 100

    Margin Requirement

    As we described above, spread betting uses leverage, meaning you don’t have to pay the entire value of your trade upfront. As such, UK100’s 5% margin requirement means you only need 5% of the full value of the position in your account to open it.

    The total value of your position in this scenario (£5 per point x 7,952.62) is £39,763.10, giving you a margin requirement of £1,988.15.

    Note: You do not need to calculate the margin requirement manually. As soon as you enter the stake size in the deal ticket, the broker platform whose services you are using automatically calculates it.

    Remember, the higher the stake, the more money you have to deposit. You should always ensure that you have enough free equity in your account to sustain any losses and avoid being placed on a margin call.

    Risk Management Strategy

    In spread betting, leverage always increases both your profits and your losses. To minimize risk, it is always a good idea to use a risk management strategy.

    For this, it is important that you at least decide that

    • How much can you lose on a trade?
    • How much profit are you targeting?

    Then use stop-loss to automatically close your position at those levels. Along with this, you should use limit orders to ensure your profit.

    For example, you might decide that your maximum loss here is £50, placing a stop at £7,902.

    Also, if you want to aim for a profit of £100, make the risk worthwhile. So you need to place a limit order at £8,052.

    • Stop loss will close your trade if the FTSE drops 50 points to £7,902.
    • Take profit or limit order to close if FTSE rises 100 points to £8,052.

    Winning in Spread Betting

    Let’s say your prediction proves correct and the FTSE goes up, taking the index price to £8,012.62.

    Your profit target from the trade was £8,052, but let’s assume you also became concerned about the impending bearish market here, so you decided to take your profits early.

    As you initially bought the UK 100, you would need to sell it at £8,012.62 to close the position, giving you a 60-point return.

    Your spread-bet profit

    Multiplying 60 points by £5 per point will give you a total tax-free benefit of £300.

    Winning a Long Trade
    Winning a Long Trade
    • You go long £5 per point at £7952.62
    • The market price rises by 60 points.
    • You make a profit of £300 (£5*60 points).

    Please note here that since this is a daily-funded trade, you will be charged a small overnight funding fee if you keep your position open overnight.

    Lose spread bet

    Now think about it, what will happen if UK 100 falls?

    Let’s say that instead of rising, the index falls to £7,902.62, leaving your spread bet open at a loss and triggering your stop loss.

    Here the FTSE has fallen 50 points, which when multiplied by your £5 stake gives you a loss of £250.

    Losing a long trade
    Losing a long trade
    • You go long £5 per point at £7952.62
    • The market price drops by 50 points.
    • You make a loss of £250 (£5*50 points).

    Please note here that since this is a daily-funded trade, you will be charged a small overnight funding fee if you keep your position open overnight.

    How to Bet on Forex Example (EUR/USD)

    Next, let us look at the example of the largest Forex pair, EUR/USD.

    Today the EUR/USD pair traded at 1.0838/1.0839. You can buy at 1.0838 and sell at 1.0839. And the spread is at 0.8 points.

    You decide to open a short trade by selling EUR/USD at 1.08388, betting £3 per point to make £3 for every pip that EUR/USD falls.

    However, you will lose £3 each time the pair moves up.

    Margin in forex

    The Forex market has lower margin requirements than other asset classes, which means you can use higher leverage. You will need only 3.33% of the full value of this position in your account to open it.

    The value of the trade (3 x 10,838) is £32,514, leaving us with a margin requirement of £1,082.72.

    You should ensure that you have excess funds in your account here, however, in case the situation goes against you and your margin decreases.

    Risk Management When Shorting

    By now you must be well aware of how important stop-loss orders are while trading.

    Stop-loss orders are also important when trading short. Because there is no limit to how high the market will go, and there is no way to limit your losses unless you place a stop-loss order.

    When shorting, let’s set a stop loss order 65 points away at 1.0903.

    Along with this, we also use a take-profit order at 1.1033, which will automatically close the position if it earns a profit of 130 points.

    With our bets of £3 per point, this would mean our maximum loss would be £195, and our profit target is £390.

    Winning EUR/USD Trades

    We assume here that EUR/USD falls to 1.0718, which will trigger your take-profit order, thereby closing your position with a 120-point profit. Multiplying that by your £3 stake gives you a profit of £360.

    Winning a Short Trade
    Winning a Short Trade
    • You go short £3 per point at 1.0838
    • The market falls by 120 points, triggering your limit order at 1.0718.
    • You make a profit of £360 (£3*120 points).

    What you need to be careful about here is that you don’t keep your position open for more than a day, so you don’t have to pay anything for overnight funding. So the only cost of placing this trade (£3 x 0.8) is the £2.40 spread.

    Loss in EUR/USD trading

    Let’s say the EUR/USD rises and you start making a loss on a EUR/USD trade. But you put a stop loss, which stops your losses at 1.0913. This would result in a loss of £180 in your position.

    Losing a Short Trade
    Losing a Short Trade
    • You go short £3 per point at 1.0838
    • The market rises by 60 points, triggering your stop-loss.
    • You make a loss of £180 (£3*60 points).

    How to spread bet on commodities example

    Let’s lastly decide to bet on Gold. which is currently trading at £1,809.55, with a buy price of £1,809.95 and a sell price of £1,809.15. As you believe the price of gold is due to decline, we open a spread bet to sell the commodity for £40 per point of movement.

    Gold has a margin factor of 5%, so you would need to put down £3,618.30 (£40 x £1,809.15 x 5%) to open the position.

    If your commodities spread bet was correct

    Let’s say the price of gold did fall, down to a new price of  £1,780.15. Then you required to close your position at the new buy price of £1,780.90.

    As the market has moved in your favor by 28.25 points (1,809.15 – 1,780.90), you would be taking a profit of £847.50 (28.25 x £30). If you had kept your position open overnight, you would have had to pay funding charges.

    If your commodities spread bet was incorrect

    However, if you were incorrect and the market price of gold rose instead, to 1,845.60, you would have made a loss. You’d close your position, at the new buy price of 1,845.30.

    As the market has moved against you by 36.15 points (1,809.15 – 1,845.30), your total loss for the commodity spread bet would be £1,084.50 (36.15 x £30), plus any funding charges.

    Spread betting and taxation

    Spread betting has significant tax advantages compared to other trading and investing activities. Winnings from stock, forex, and CFD trading are subject to UK capital gains tax, but winnings from betting are not subject to UK capital gains tax. This is because it is legally considered gambling rather than an investment.

    Let’s say you made a profit of £20,000 by selling shares at a higher price, you will have to pay capital gains tax on that amount. However, if you had made a profit of £20,000 on a spread bet predicting the share price to rise, you would not be subject to capital gains tax.

    Customer profits in spread betting are tax-free but spread betting firms or platforms are required to pay tax. They have to pay VAT on their earnings and commission. Customers must report any earnings on their annual tax filing, even if no taxes are due.

    It is important to note here that taxes on spread betting vary according to the jurisdiction in which it is played. As

    • United Kingdom (UK): Spread betting revenue in the UK is generally exempt from stamp duty and capital gains tax (CGT), this is a big advantage there. Exemptions apply to those whose main source of income is betting. As a result, betting profits are not taxed in the United Kingdom.
    • Republic of Ireland: In Ireland, spread betting is generally exempt from capital gains tax, as it is in the UK. This exemption is applicable for both individual and corporate traders whose main activity is spread betting. As a result, profits derived from spread betting are generally exempt from taxation in Ireland.
    • Other countries: There may be differences in the way betting is taxed in different countries. Spread betting winnings may be subject to various taxes or capital gains taxes in some jurisdictions. To fully understand the unique tax implications of spread betting operations, people are recommended to speak to a tax advisor or relevant tax body in their country.

    Spread Betting vs Forex Trading

    ParticularSpread BettingForex Trading
    Nature of the Instruments TradedIn spread betting, traders speculate on the price movements of various financial instruments, including stocks, indices, currencies, commodities, and bonds, without actually owning the underlying assets.Forex trading, also known as foreign exchange trading or currency trading, involves buying and selling currencies in the foreign exchange market.
    OwnershipNoYes
    Profit fromSpread betting allows traders to profit from both rising and falling markets.Forex traders aim to profit from fluctuations in exchange rates between different currency pairs.
    Tax TreatmentIn certain jurisdictions such as the UK and Ireland, profits from spread betting are often exempt from capital gains tax and stamp duty. Profits from forex trading may be subject to capital gains tax in some countries, depending on the individual’s tax residency and applicable tax laws. 
    Leverage and MarginSpread betting providers offer leverage.Forex trading also involves margin trading, enabling traders to control larger positions with a smaller initial investment. 
    RegulationMany countries do not regulateYes

    How to Choose the Best Spread Betting Broker in the UK?

    Choosing the best spread betting broker in the UK requires careful consideration of many factors to ensure that the broker meets your trading needs and preferences. Here are some things you can remember to help you choose the right spread betting broker: 

    • Regulation and reputation: Verify that the spread betting broker is regulated by the UK’s Financial Conduct Authority (FCA). Trading with an FCA-regulated company ensures that your funds are safe.
    • Trading Platform: Evaluate the trading platform offered by the broker, and ensure that this is user-friendly and equipped with all the necessary features.
    • Range of Markets: Next, you assess the range of financial markets offered by the broker, including stocks, indices, currencies, commodities, and bonds.
    • Low spreads and commissions: Then, compare the available brokers and choose the one with low spreads and commissions.
    • Leverage and Margin: Evaluate the brokers’ leverage and margin requirements.
    • Customer Support: Also check the customer support of the brokers.

    FAQs

    What Is Spread Betting?

    Spread betting is a way to bet on the change in the price of some security, such as indices, stocks, currencies, and commodities, without purchasing the underlying asset.

    If traders expect an asset’s price to rise, they have to open a position to ‘buy’ and if they expect an asset’s price to fall, they have to opt to ‘sell’.

    Is Spread Betting Legal In the U.S.?

    Is Spread Betting Gambling?

    Is spread betting risky?

    Is spread betting profitable?

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