Spread betting what is margin

Six steps to placing a spread bet Learn how to spread bet Create and fund an account Build a trading plan Find an opportunity Choose your spread betting platform Open, monitor and close your first position.

Alternatively, you can practise trading first in our risk-free demo account. Create account. Build a trading plan A trading plan outlines your motivation, time commitment, goals, attitude to risk, available capital, markets to trade and preferred strategies. Learn how to build a trading plan. Find an opportunity Once you're logged in to our platform or app, you can choose from 17, markets, including: Forex Indices Shares Commodities Discover the benefits of spread betting.

Choose your spread betting platform Start spread betting on our award-winning suite of platforms, including: Our web-based platform Mobile trading apps MetaTrader 4 Advanced platforms These can all be tailored to suit your trading style and preferences, with personalised alerts, interactive charts and risk management tools.

Find out more about our trading platforms. How to spread bet on shares example You decide to spread bet on Barclays stock, which is currently trading at How to spread bet on indices example You want to spread bet on the FTSE , which has an underlying market value of How to spread bet on commodities example You decide to spread bet on gold, which is currently trading at If your commodities spread bet was incorrect However, if you were incorrect and the market price of gold rose instead, to What markets can I spread bet on?

Who can spread bet? How much does spread betting cost? I already have a spread betting account with a different provider, but I'm thinking of opening an account with IG. What do I need to do? Is online trading safe? Learn more. Try these next…. Discover the differences between spread betting and CFD trading. Learn about risk management tools including stops and limits. Browser-based desktop trading and native apps for all devices.

Spread betting What is spread betting and how does it work? Help and support Contact us Interested in opening an account? Follow us online:. Spread betting is a leveraged traded product and spread betting providers will insist that you deposit a certain percentage of the total market exposure you take with them before they will permit you to open a trade.

This deposit is referred to as margin and acts as a guarantee that you will honour the contract. To open a spread betting trade, you need to deposit with the spread betting company a margin amount, which will be a percentage of the total value of the spread trade. The initial margin amount will be withdrawn from your account by the spread betting provider when you place the trade. Different spread betting providers will have different margin requirements for spreadbet over the same underlying asset.

Margin requirements will tend to be higher for spreadbets over stocks than for other assets. Margin trading is all about leverage and gearing. With both strategies, real risks are apparent, and deciding which investment will maximize returns is up to the educated investor. Trading Instruments. Company Profiles. Your Privacy Rights. To change or withdraw your consent choices for Investopedia. At any time, you can update your settings through the "EU Privacy" link at the bottom of any page.

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The Bottom Line. Brief Overview Investments in financial markets can reap large rewards. Key Takeaways Contracts for difference, or CFDs, are short-term leveraged derivative contracts that track the value of some underlying instrument and pay off accordingly.

Spread betting involves placing a speculative bet on the price movements of an underlying instrument without actually owning it. Although similar on the surface, there are several fundamental nuances that differentiate CFDs from spread betting. For the most part, CFD trading is not allowed by law for American residents. Compare Accounts.

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Spread betting margin also depends on the size of the position that you wish to open. These start relatively low at 3. CMC Markets is an execution-only service provider. The material whether or not it states any opinions is for general information purposes only, and does not take into account your personal circumstances or objectives.

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Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. You should consider whether you understand how spread bets and CFDs work and whether you can afford to take the high risk of losing your money.