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Spread Betting with FXCM

Financial spread betting is a premier way for residents of the U.K. and Ireland to engage the capital markets. Spread bettors enjoy tax-free proceeds and the opportunity to profit from rising or falling markets―all without having to assume ownership of any assets. In addition, spread bets are traded commission-free and with leverage. If you're interested in trading forex currency pairs, commodities, shares and indices, then spread betting with FXCM is certainly worth a look.

Why Spread Bet?

Tax Free

If you are a resident of the U.K. or Ireland, you have the opportunity to spread bet free of capital gains tax and stamp duty.1

Access to leverage

Applied leverage varies according to the underlying asset being traded. Standard leverage limits fall within the range of 2:1 and 30:1.2

Multi-asset Platform

You can engage in spread betting with the forex, commodities, shares and indices via FXCM's collection of award-winning trading platforms on desktop, web, or mobile applications.

Spread Bet rising or falling markets

Spread betting is flexible, allowing you to take advantage of both rising and falling markets.

When you spread bet with FXCM, you enjoy:

  • Multiple platforms and mobile apps
  • Smaller bet sizes (from 7p a point)
  • Award-winning customer support

With spread betting, spreads include a mark-up, but there are no commissions to pay—all trading costs are built into the spread. CFD-trading accounts are charged commissions.

This, in addition to the tax advantage, is why many UK and Ireland residents choose to spread bet instead of trading CFDs.

Still undecided? Find out more about CFD trading.

Spread Betting Spread Costs

Pair Spread Pair Spread Pair Spread
AUD/CAD 2.2 AUD/CHF 3.3 AUD/JPY 2.0
AUD/NZD 3.5 AUD/USD 0.8 CAD/CHF 3.4
CAD/JPY 2.0 CHF/JPY 2.5 EUR/AUD 2.5
EUR/CAD 2.4 EUR/CHF 1.3 EUR/GBP 1.1
EUR/JPY 1.9 EUR/NOK 54.0 EUR/NZD 4.1
EUR/SEK 46.3 EUR/TRY 111.5 EUR/USD 0.8
GBP/AUD 4.2 GBP/CAD 4.0 GBP/CHF 2.7
GBP/JPY 2.4 GBP/NZD 5.8 GBP/USD 1.1
NZD/CAD 4.7 NZD/CHF 4.6 NZD/JPY 2.1
NZD/USD 1.0 TRY/JPY 6.5 USD/CAD 1.0
USD/CHF 1.0 USD/CNH 8.7 USD/ILS* 45.9
USD/JPY 0.8 USD/MXN 60.9 USD/NOK 48.4
USD/SEK 42.6 USD/TRY 89.1 USD/ZAR 90.5
ZAR/JPY 4.1
Disclosure
*

USD/ILS is only available for MT4 accounts.

Free Practice Account

If you are new to FX/CFD trading and spread betting, then the best way to get up-to-speed is to sign up for a free FXCM demo account. It's an ideal way to become acquainted with FXCM's cutting-edge trading infrastructure. Demo trading accurately simulates live market conditions and is absolutely risk-free.

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Concept Of Spread Betting

Spread betting is a form of derivatives trade centered on speculation pertaining to the future pricing volatilities facing a specific asset class. Simply put, it is a financial tool that enables traders and investors to capitalise upon a forthcoming move in a security's price without having to own the security.

The concept of a "spread" has a great deal of relevance to a spread bet's function. Essentially, a spread is the difference between the bid and ask price of an asset, or the prices in which a trader may buy or sell a security on the open market.

Current supply and demand forces determine the magnitude of the bid/ask spread, influenced by liquidity providers, independent retail traders and institutional investors. As buyers and sellers interact within the marketplace, the process of price discovery ensues. This interaction influences the spread, evolving price action to a state of equilibrium.

When spread betting, the direction of ever-changing price action is the ultimate focus of the trade.

Active traders find spread betting to be a straightforward and useful way of engaging the capital markets. If price is expected to rise over a given period, a trader can simply join the bid; if price is projected to fall, then joining the ask may be ideal. The flexibility, available leverage, market diversity, and ease of trade are key advantages enjoyed by spread bettors.

Why Spread Bet?

Spread Bet Chart

Spread betting affords traders and investors several unique advantages over other methods of engaging the capital markets. As a provider of forex and CFD market access, FXCM offers its clientele the multifold benefits of spread betting:

Asset Class Diversity:

An abundance of trading options are readily available for spread betting participants. FXCM offers access to world's leading asset classes featuring currency pairs, equities indices, shares and commodities.

Access To Leverage:

Spread betting is the trade of derivative securities. Accordingly, enhanced degrees of leverage are applied in each and every transaction. Leverage limits vary with respect to product, ranging from 2:1 to 30:1. Greater leverage boosts the trading account's purchasing power, optimising capital efficiency.2

Engage Rising Or Falling Markets:

In contrast to buying shares of stock, spread bettors have the ability to profit from both rising and falling prices. The flexibility to open long or short positions in the market opens the door to countless strategic possibilities.

Tax Advantages:

For residents of the U.K. and Ireland, proceeds realised from spread betting are tax free.

Low Fees:

Spread betting features a commission-free pricing structure. All fees are built into the spread itself, reducing the cost of executing a trade in the live market.

Spread Betting In Action

Assume that a new currency trader holds conviction that the EUR/USD is going to rise from a current level of 1.1200. In order to benefit from the perceived opportunity, the trader contacts a spread betting firm and is quoted a spread of 1.1200/1.1203. The transaction is then executed accordingly:

  • A long position is opened at 1.1203
  • Leverage is implemented at £1 per pip
  • The EUR/USD rallies to 1.1210
  • The proposition is exercised at 1.1210
  • Profits are calculated and realised, 7 pips * £1 per pip = approximately £7

Of course, in the event that the EUR/USD fell 7 pips from entry, then a loss of £7 is sustained. In much the same fashion as many other modes of trade, successful spread betting is the product of sound strategy, proper money management and consistency within the marketplace.

For those interested in spread betting, FXCM provides market access via multiple platforms and mobile apps along with award-winning customer support. In addition, a robust suite of educational materials and a free £5,000 practice account are available to individuals looking to take their trading to the next level.

Disclosure
1

Tax Treatment: The UK tax treatment of your financial betting activities depends on your individual circumstances and may be subject to change in the future, or may differ in other jurisdictions.

2

Leverage: Leverage is a double-edged sword and can dramatically amplify your profits. It can also just as dramatically amplify your losses. Trading foreign exchange/CFDs with any level of leverage may not be suitable for all investors.

Hypothetical/Simulated Performance: These results are based on simulated or hypothetical performance results that have certain inherent limitations. Unlike the results shown in an actual performance record, these results do not represent actual trading. No representation is being made that any account will or is likely to achieve profits or losses similar to these being shown. Simulated or hypothetical trading programs are generally designed with the benefit of hindsight, do not involve financial risk, and possess other factors which can adversely affect actual trading results.

Spread Betting: FXCM UK offers tax exempt spread betting accounts exclusively to UK and Ireland residents. Residents of other countries are NOT eligible. Spread betting is not intended for distribution to, or use by any person in any country and jurisdiction where such distribution or use would be contrary to local law or regulation. The UK tax treatment of your financial betting activities depends on your individual circumstances and may be subject to change. Spread Betting accounts offer spread plus mark-up pricing only. Spreads are variable and are subject to delay.

Average Spreads: Time-weighted average spreads are derived from tradable prices at FXCM from July 1, 2020 to September 30, 2020. Spreads are variable and are subject to delay. The spread figures are for informational purposes only. FXCM is not liable for errors, omissions or delays or for actions relying on this information.