Spread betting

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21. Opening an account

If you want to get involved in spread betting, the first step is to open an account with one (or more) of the indexation companies and transfer the minimum sum of money into your account.

• It is important to read the terms and conditions of business of each firm.
• The minimum initial deposit varies from company to company.
• You can usually open an account by phone, post or online.
• The indexation company will assign a primary dealer to your account. That person will be your main point of contact for dealing and account queries.
• As a rule of thumb indexation companies do not let clients place a bet without enough money in their account to cover the maximum loss on that bet. This proportion of your funds will be frozen until that particular bet is settled.
• If your exposure to losses exceeds your credit limit, the indexation company may ask you to deposit more money in your account - known as a "margin call".
• Experienced spread betters are usually offered a credit limit. Debts are payable weekly or monthly, depending upon the individual and the company involved.

Here are a few of the numerous spread betting companies:

1. Cantor Index offers financial spread betting only. It also offers Contracts For Difference (CFDs) trading, www.cantorindex.com. Its sister site Cantor Sports offers sports spread betting, www.cantorsport.com.
2. City Index offers both sports and financial spread betting, www.cityindex.co.uk.
3. Financial Spreads offers financial spread betting, while Sporting Index offers sports spread betting, www.finspreads.com and www.sportingindex.com.
4. IG Index Offers financial and sports spread betting, CFD trading and foreign exchange trading, www.igindex.co.uk.
5. Spreadex offers both financial and sports spread betting, www.spreadex.com.
6. William Hill, or "Hills", offers only sports spread betting, www.williamhill.co.uk.
7. CMC Markets offer spread betting in thousands of instruments including Shares, Indices, Commodities and Treasuries.

1. What is spread betting? 2. A brief history 3. Spreads on individual equities 4. Spreads on an index 5. Performance spreads 6. Other financial spreads 7. Practical advantages - leverage 8. Practical advantages - going short 9. Practical advantages - hedging 10. Practical advantages - volatile markets 11. Practical advantages - tax 12. Dynamics - think short term 13. Dynamics - the size of the spread 14. Dynamics - upside and downside 15. Dynamics - length of bet 16. Strategy - bet only what you can afford 17. Strategy - cutting losses 18. Strategy - stop losses and limited risk bets 19. Strategy - taking profits 20. Strategy - arbitrage 21. Opening an account 22. Placing a bet and managing your account 23. Regulation 24. Some more tips 25. Conclusion

• The Investors Guide to Financial Spread Betting