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Guide to financial spread trading

LetsCompareBets guide to financial spread trading is more technical in it’s approach to guiding traders to make better trading decisions. Real world situations will be used to make the concepts involved easier to understand. No prior experience is necessary, but, for a beginners introduction to spread betting use the navigation to the left.

For a detailed look at financial spread strategies follow the link.

To make it easier to get specific bits of information on financial spread trading use the links below to access sections in this guide.

What is financial spread trading?
Why
Starting out
Trading decisions
Strategies

What is financial spread trading?

In a nutshell financial spread trading is spread betting for a living or a second income. The notion of chance or unpredictability should be isolated in this definition. Trading financial markets successfully is all about tipping the balance of probability in the traders favour and minimising losses. Successful financial spread trading should take the betting out of spread betting.

Why use financial spread betting for online trading?

Spread betting offers a good vehicle for trading financial markets. It’s cheap. Stock brokers will charge you for setting up trades. It is relatively easy. If you can follow a set of simple instructions you can set up a spread bet. It is tax free, in the United Kingdom.

Also a major factor is that you don’t require hugh amounts of capital to start financial spread betting. It’s worth bearing in mind that the ‘spread’ is larger than what you will find with a stock broker. The reason being because spread betting companies don’t charge commission.

The spread varies from share to share and is much larger for some. But, it is easy to ignore those. The spread also differs from spread betting company to spread betting company. So once you are more experienced most people would shop around. This financial spread betting guide will discuss ways to ensure the spread doesn’t really effect our trading in any case.

In addition spread betting allows you to buy and sell in equal amounts giving twice the opportunity for profit.

Starting out

The difference between financial spread betting and financial spread trading boils down to three things.

Records are very important to successful financial spread betting. Maintain accurate records, use them as a point of reference and and learn from them. Mistakes are enevitable…so learn from them.

Emotions. Successful financial spread trading relies on keeping your emotions in check.

Money management. Nobody is perfect. Mistakes will happen. Good money management will ensures that losses are small and gains are bigger.

Trading decisions

Trading decisions are the building blocks of financial spread trading. As such, how we come to reach our trading decisions is very important. Some may use fundamental analysis only and some may use technical analysis. In reality for successful financial spread betting a mixture of the two is needed. The art is knowing how to analyse this information and act upon it.

Financial spread betting strategies

Do you go with gut instinct? Probably not the best strategy. Gamblers tend to trade from the gut. Whether you are a beginner or have some experience at financial spread betting successful financial spread trading needs to have structure. There are various strategies and methods of financial spread trading that can improve profitability.

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