 What is financial spread betting? Spread betting is a tax-efficient way to trade on thousands of global financial markets, including shares, indices, foreign exchange, treasuries and commodities. If you think a product will go up in value, you can place a buy bet or go long. If you think a product will fall in value, you can place a sell bet or go short. The difference between the sell and buy price is called the spread. With spread betting, you do not buy or sell a number of shares. You buy or sell an amount per point movement, such as £5 per point. This is known as your stake. Your profit or loss is based on the difference between the price you enter at and the price you exit at. The more points the market moves in your chosen direction, the more profit you make. This difference, multiplied by your stake size, equals your profit. If the market moves in the opposite direction, you will make a loss. You don't need much capital to get started either, as you don't have to outlay the full value of your position, just a small percentage. This is called trading on margin. Since you don't own the underlying asset, there is no stamp duty to pay. All profits from spread betting are also exempt from capital gain stacks. Visit our website and open a demo account to learn more.