How Safe is Spread Betting?

spread bettingIn the current financial times we live in there are people looking for various ways to make money, some are safe, some are dangerous, and some are just a waste of time!

One of the alternatives that you may not have considered is spread betting, which can see you gain great returns on your investments, or conversely massive losses.

This is why you need to make sure you do your research before you begin to invest in such a method to make money, because if you don’t there is a chance that you will lose more money that you hoped for, and see the money that you wanted to save disappear before your eyes.


What does spread betting offer?

Spread betting is essentially betting on the stock and shares markets. Therefore you are making the same moves as someone who has actually invested in stocks and shares without actually buying them. So if you have always wanted shares in that top company, for example Apple, then you can actually find a way of getting rewards from their shares, without actually holding any of them.

At the same time, â˜investing’ in these shares will not cost as much as actually trying to find some to buy, so you can benefit from any increase, or suffer from any decrease in value, but, at the same time, spend less of your savings and investments on the stock. This means that you can control your investments completely even at a low level, and try and see returns. Obviously betting on stock market changes can be extremely risky, and you need to make sure you know what you are doing before you commit to investing your money.

That being said, if you manage to pick the right stocks you will see good returns on your spread betting activities, much the same as if you were investing on the normal stock market.


Is it actually safe then?

So is spread betting safe? Realistically it is only as safe as you make it. If you decide to invest in a spread betting firm, and begin to see which stocks appeal to you, there are limits you can set. You can set a limit on the amount of money you make before you take your investments out, and you can also set a limit on the amount of money you lose before your investment ends.

This means that you do have ultimate control, just in case the markets collapse. Whilst this gives you slightly more freedom than investing on the stock market, it is important to remember that you should not get carried away, at the end of the day the stock markets are an extremely liquid market and a bad day can lead to huge losses. On the other hand you could have a great day and see huge profits, it’s just about playing the right cards at the right time, and to do that you need to make sure that you do a lot of research on the market you intend to bet on.

(This article is written by James who has a strong interest in different investment techniques, including spread betting. He believes it is important to manage investments appropriately and advises you check the various spread betting firms before beginning to bet on the markets.)