Winspreads

Financial Spread Betting allows you, an investor, to speculate on the directional movement of the price of a financial instrument, without requiring you to physically own the instrument or to physically settle it. In order to trade, you have to decide the amount that you wish to trade on each point movement of the underlying instrument. Every point movement that the price of the underlying instrument moves in your favour, will result in a profit for you. In contrast, every point movement of the price of the underlying instrument against you, will result in a loss for you.

When you trade on the price of the financial instruments, you do not actually own the underlying asset. However, you are entitled to some of the benefits, such as dividends, rights issues etc, as if you were an owner of the underlying asset. The main difference is that you will not receive any voting rights on individual equities.

Charges are made when you hold a long trade open overnight. This is a financing charge to hold the trade open. In reverse, you will receive a credit for short trades held open overnight.

For each of your open trades, you are required to place a deposit known as ‘margin’. Because you do not have to pay the full amount of your trade size, Spread Betting allows you to increase the amount of exposure to a financial instrument through leverage. This means you can place a larger trade than if you traded using simply the funds you placed in your account. Leverage has the effect of magnifying the profits or losses on your trading capital. The maximum amount of leverage available to you varies with the instrument you are trading.

A margin call occurs when there is insufficient funding in your account to cover your open trades with the necessary margin. This happens if your account valuation falls below the margin requirement. Limited Risk Account holders will not receive margin calls.

To view an example on margin call, please click here.

There is no minimum account balance which is pre-set. However, you must maintain sufficient deposited funds in your account to cover the NTR for your open positions, or you will face liquidation of one or more positions.

The minimum stake size depends on the instrument, and is typically one unit for any equity, index, commodity or bullion. See Market Info for further details of minimum stake sizes with us.