The Market Range – what‘s on offer for spread betting?
Spread betting has become a financial instrument increasingly used by traders. Thus it is important to compare spread betting brokers because some offer different markets to others. The trade offer is limited with some spread brokers. As you expand your trading, you’d want to trade on as many markets as possible. Even if you prefer a few core markets it is recommended to have the option to expand your trading – especially if you think you’ll be active in spread betting for the long term. Additional trading options, like Forex, CFDs or ETFs, might also be a good idea if you don’t want to limit yourself to spread betting.
Forex, CFDs, indices and raw materials
A broker is especially convincing if the trade offer is as broad as possible. With many providers you can engage in spread betting and trade CFDs on indices, commodities, foreign exchange and equities as well. A broad trade offer is a very good basis for trading. But in a comparison, you should take a closer look and get an idea of how the broker is positioned in the individual assets with regard to the underlyings. 79
- Compare the choice of markets on offer for spread betting.
- Which other instruments are available for trading?
- Make sure you do not limit yourself and have additional options.
Conditions: Costs of Spread Betting
Checking out the fees is an especially important part of a broker comparison. A consideration that is really crucial when selecting a spread betting account is the cost of transactions. This is usually expressed in pips in the spread. You’ll realize that even a difference of 1 pip can be to your disadvantage, depending on the number of transactions you envision. In a spread betting broker comparison you should take care to check out the cheapest provider who also qualifies in all the other areas, since this will pay off for you.
Possible additional fees
Trading costs should at best be listed in a transparent way. In addition to the spreads you should inform yourself whether commissions are due, though some providers charge commissions only for certain products. Besides, any fees for the trading account should be checked out. Usually accounts are free of charge, but there may be minimum deposits, trade minimum limits and deposit margins, so be sure to study the terms and conditions to see if additional costs are to be expected.
- In a Spread Betting Broker Comparison the transaction costs are a crucial issue.
- You should compare the providers‘ spreads minutely as even 1 pip matters.
- Not all fees are transparent – having a look at the terms and conditions is recommended.
Spread betting brokers with multiple account models
It may well be that a spread betting broker offers various account models. This is an advantage, as the costs and benefits may vary according to different levels of experience. Multiple accounts are especially interesting if, for example, there are accounts with fixed spreads, all the more so if the broker offers other financial instruments you wish to trade. Check the broker comparison to find out if different account models are available, and look up other criteria, such as whether a better service or additional services are available based on the respective account model.
Another criterion to be included in a broker comparison is the minimum deposit. While this is no indication as to whether a broker is reputable, it is important for many traders to make up their minds about opening an account. Spread betting is interesting even for small investors and thus, a high minimum deposit is a significant disadvantage. Since brokers usually know the appeal spread betting holds for retail investors, the minimum deposit may be small to non-existent, yet some providers go for a deposit of £ 100.
- Get an overview of the account models available.
- Compare the terms and benefits of the respective accounts.
- Some brokers may require a minimum deposit, while others waive this.
Spread betting trading platforms and mobile trading
The trading platform matters – most platforms share the same functionality, with some more intuitive and investor-friendly than others. Checking out the platform is crucial in your selection of a spread betting broker. The software should be reliable, easy to use and with an overview of your activities. A good trading platform offers:
- Intuitive handling even for beginners
- Access to a wide variety of tools
- Easily customizable interface
While some brokers offer multiple trading platforms, many rely on a proprietary one. This is based on the experience that it allows them to better respond to clients‘ needs. Proprietary software often comes with a better range of tools as well. Still, the majority of brokers operate with proven trading platforms like the MetaTrader 4. If you want to have a good spread betting experience, you‘d best try out the respective services to find out if the software really suits you. Most brokers provide apps and mobile software solutions for additional flexibility with trading to go, using a smartphone, tablet or iPad.
- Usually brokers offer a multiple trading platforms.
- Familiarize yourself with the features and tools of the platform.
- Nearly every broker offers mobile trading software solutions.
Usability of a spread betting broker‘s website
The user friendliness of a spread betting broker’s website is an important factor when it comes to finding out who is the best spread betting provider. he This is not only about user-friendliness, but also the first impression for a trader, for instance with the customer service. Besides, all relevant important information should be easy to locate and initial questions a trader might have should be answered. Besides, content should be available in a language you understand. The following information should be available at a glance:
- The range of markets on offer
- Account models and trading platforms
- Spreads and other fees
- Contact options and information on regulation
As many brokers operate internationally, you may expect an English language website. As a rule, you should have the option of selecting your language in the header area of the website if you are not automatically redirected to the English language version. Some areas deserve a closer look, because at least pages like the legal documents, the price-performance-overview and also the support and/or FAQ should be available in your language.
- Look out for easy navigation and user-friendly website design.
- All relevant information should be easily located.
- Important content should be available in your language.
Customer support – your contact in case of emergencies
Customer service is an important issue in spread betting if you should encounter a problem. Usually the first questions arising should be clarified on the website, where many brokers provide a FAQ section. This should give you helpful answers to most frequent questions. But as this is not always sufficient, you should test the support before deciding to register, to see if the contact paths, the times of availability and the competence of the customer service staff are convincing.
To be the best spread betting broker in the field of customer support a provider should have support staff available at the times when you primarily use the services. While some brokers offer 24/7 support, others do so on weekdays only, or at fixed times extending to the early evening. Take a closer look at the contact options provided. A live chat is very convenient and allows you to continue trading without needing to open an extra mail or a form. The advantage of a chat is that you receive an answer directly. But even a hot-line might be a good communication solution, only be sure to check if there are any charges.
- Check out the contact options in a broker comparison
- Is there a support during your preferred trading hours?
- Don‘t hesitate to test in advance whether the support answers swiftly and competently.
Methods for deposit and withdrawal
When making up your mind about who might be the best spread betting provider for you, the methods of payment should be taken into account. The deposit into the account with the spread betting broker is the first step for you to start trading. Usually a wide range of payment options are on offer, including:
- Deposit by credit card
- Deposit using online services such as Skrill, Neteller or PayPal
- Deposit by SOFORT transfer
Most brokers allow their clients a variety of options to choose from. While many traders still use the credit card as a means of payment because of the conveniently quick transactions, others prefer payments by bank transfer, because these convey a sense of security. Bank transfers, though, are not always the first choice because of the much longer processing time. For quick transactions, Neteller, Skrill and SOFORT transfer are also available at many brokers. When considering payment methods in your evaluation, keep in mind that sometimes quick transactions make a lot of a difference.
An important criterion in terms of payment terms are possible fees and limits, so check these in advance.
- Various methods of deposit and withdrawal
- Look up possible fees and limits
- Take the duration of the transfer into consideration
Additional offers: spread betting demo account, webinars & more
A provider who wants to be dubbed best spread betting broker for beginners should offer additional benefits – like a demo account, training and education options like webinars, video courses, tips on strategies, eBooks or lexicons. But the crucial thing is not always quantity – and not only for beginners. Experienced traders may benefit from such offers as well. Therefore it is a good idea to find out which tools and extras are available, like business calendars or automatic trading systems. And a demo account is a major advantage.
Making the best of a spread betting demo account
If as a beginner you want to gain some spread betting experience in trading without investing your own capital, use a demo account. A spread betting demo account gives you the opportunity to try out the platform and trading. Besides, you can use it for testing strategies. If the demo account is available only for a limited time, this is not mark against the broker, but of course an unlimited version is especially advantageous. Beyond the validity what should concern you is the amount of virtual credit, and you should see if you can trade with the demo account at real trading conditions, with an environment corresponding to a „real“ trading account.
- Are there training and education offers?
- Which additional tools and extras are available?
- A demo account is an advantage for beginners and advanced traders alike.
Regulation and deposit insurance – is a Spread Betting Broker reputable?
Of course with financial instruments such as spread betting fraud cannot be excluded completely, but regulation provides information on whether a broker’s activities are controlled, with action taken if necessary. In order to obtain a license, a broker must comply with regulatory requirements. This is the responsibility of the respective financial regulator at the head office of a broker. A provider offering services in other countries as well is usually also registered with local authorities.
Security of client funds and data protection
In order to counteract spread betting fraud you should select a broker offering encrypted data transfer in the broker comparison. Without encryption you run the risk that the data might be intercepted and misused by hackers. But this is not the only criterion to keep in mind when considering who might be the best spread betting provider. Beside regulation, insurance of client funds is particularly important. You should inform yourself if and up to what amount your deposits are insured, and it is recommended to check whether a broker keeps assets and client funds in segregated accounts.
A broker comparison should contain the following important points:
- Client funds‘ insurance
- Data encryption
Providers in the test: Trade press reviews and awards
You have found a broker who seems convincing in most important areas and meets your needs? Then it might interest you to find out if the provider has been mentioned in the media or has received awards for achievements. Use specialist magazines, because they conduct regular tests and give awards such as “Best Spread Betting Broker”. A look at recent reviews lets you find out if there are changes with a broker, the offers he makes and his rating by the press. Usually brokers themselves are happy to refer to media coverage on their websites and link to relevant reports.
The trade press as well as various portals dealing with spread betting providers repeatedly give awards. Evaluated are the support, the platform, the trade offer or the complete package. First place goes to the broker who delivers top services in the respective areas. Look for titles like “Best Trading Platform” or “Best Spread Betting Broker” – and check that they are recent. You’ll also find customer ratings about the respective brokers, but these may be subjective and should therefore not be that crucial for your decision.
- Are there favourable trade press reviews and expert opinions?
- Ratings of other traders are not critical, because they are generally subjective.
- Check out possible awards of the broker of your choice.
Market overview and market outlook
Spread betting is an increasingly popular leveraged product, where traders need to come up with a small percentage of the full value of a position that may be up to 100 times greater than the notional trade value. The trader need not buy the underlying assets, allowing him to speculate on the price movement of various markets like indices, shares, Forex, and commodities, and on rising as well as falling prices. As the number of underlyings also increases, this financial instrument will without doubt become more attractive especially to experienced traders. But traders should keep in mind that spread betting is a very risky option.
Assessing future developments
With an increasing number of brokers offering the possibility to trade online, the upturn is hard to beat. But what are the prospects of spread betting? In the U.K., spread betting is a financial instrument that provides a tax-free option to trade on price movements of many other instruments, like indices, commodities or Forex. This, together with an increase in the number of underlyings available, makes spread betting popular with traders. It will likely remain so, provided tax laws do not change in this respect.
Using comparisons and reviews to select a broker
Our comparisons and awards should guide and support you in your search for a provider. At least they will tell you which provider managed to convince us in the Spread Betting Broker Test. Nevertheless, a broker should ultimately meet your personal needs. You may want to consider various criteria and compile a shortlist before coming to a decision. That done, we recommend a broker comparison for a closer look at certain aspects like regulation and deposit insurance, costs, trading offer and software.
A preference for spread betting does not exclude an interest in other types of investment. Many brokers provide an extensive range of offers like CFD trading, stock trading or forex trading in addition to spread betting. If you are collecting information about the various spread betting brokers and you are interested in trading CFDs as well, then a CFD broker comparison might come handy. AskTraders offers you in-depth information on the various financial instruments. Take advantage of our free comparisons and inform yourself using the broker experience reviews to make sure you find the right spread betting broker for your requirements.