Spread Betting - Duty Free and Capital Gains Exempt
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Have you ever considered using financial spread betting as an alternative to buying shares? There are many beneficial reasons why you should consider this alternative. This form of investing provides one of the easiest solutions to bet on downward moving markets. Any time you are spread betting, you are not buying shares, what you really are doing is actually wagering on which way you believe your selected market will move either up or down.
Almost certainly if you are a new comer to this type of market, the term 'betting' could have put you off somewhat. Let us explain a bit, most of us hear the word betting and imagine a bookie who gives you odds, and you would then place your bet, either you win based on the odds and the bet, or else you lose. With spread betting, you are betting against somebody else who has the opposite opinion as you. For every winner there is a loser.
To make a spread bet, one must place it through a spread-bet dealer. This is not like a 'bookie', he or she is merely an intermediary. If you are set to start, you would get your package which in turn would supply all information you required. Whenever you bet, your stake will be multiplied by every point the market moves for or against you, this would determine your win or loss.
Many people are using this form of trading a great deal more these days; it is also catching up to CFD trading. Among the many reasons that investors are utilising this form of trading is for the basic fact that all profits are stamp duty free. Additionally there is better command over loss management by means of limiting order and stop losses. In addition there are no dealing commissions which need to be paid.
Why is financial spread betting stamp duty free? This is really a simple question to answer, traders are not actually transferring any asset, and instead they are selling and buying the price movements from within the actual equity. Also, the gains are exempt from the Capital Gains Tax, and this is as a result of it being in the gaming law sector.
Financial spread betting is not really always something a novice should start into, nonetheless, if you are willing to learn and maybe take a few hits, it might be good to begin. Knowledgeable traders who are involved in the market and people whom understand the risks associated with margins and gearing are typically who spread betting catch the attention of. |
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Author Resource:-
To get more information on Financial Spread Betting and CityIndex visit The Independent Investor.
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By :
Andrew Thorn
Submitted
2010-08-10 08:04:29 |
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