What is Spread Trading?
Halifax Spread Trading is a product which you can use to speculate on the price movement of an investment, whether it’s rising or falling. It is important to be aware that Spread Trading (also known as Spread Betting) is for experienced traders where it fits with their personal circumstances, as it is a high risk product. As in conventional trading there is a difference between the buy and sell price, this is known as ‘the spread’.
When placing a Spread Trade you are required to pay a percentage of the overall trade value upfront, typically between 1% and 10%, this is described as a leveraged product. This magnifies the profit or loss from price movements on your trade.
What does going long or short mean?
Simply put, this is where you decide whether you think the price of an investment will go up or down from its current value. If you think that the price will decrease you ‘go short’ or sell, if you think the price will increase you ‘go long’ and buy.
Key benefits of Spread Trading
- Spread Trading is free from Stamp Duty and any profits are free from UK Capital Gains Tax, although tax rules can change.
- Learn how to trade with reduced stake value in our Trading Academy.
- To help reduce the risk of your trade we offer a Guaranteed Stop Loss.
- Trade on both rising and falling markets by going Long or Short.
- Spread Trading is a leveraged product so you only have to deposit a fraction of the overall trade value.
Understand the risks of Spread Trading
Spread Trading is a leveraged product and it is possible to lose substantially more money than your initial deposit.
- You may be required to make further deposits at short notice to maintain open positions.
- Spread Trading is a high risk product designed for experienced investors where it fits with their personal circumstances.
- You should not open a Spread Trading account unless you fully understand the risks involved.
- Due to the risks involved with Spread Trading it is important you are aware of the Important Information and Key Features (external link opens in a new window) of a Halifax Spread Trading Account.
Getting Started in Spread Trading
Learn more about Spread Trading including some worked examples and information on the range of markets which you can trade on. Or if you are ready to apply, find out about our Trading Academy which allows you to trade with a reduced stake of 50p per point for the first four weeks.
Or why not check out our Learn How to Trade Guide (external link opens in a new window).
Halifax Spread Trading is provided by City Index Ltd and therefore your contractual relationship is with City Index.
City Index Limited is authorised and regulated by the Financial Conduct Authority (FSA Register Number 113942).
If you're thinking of applying for a Halifax Spread Trading Account, please make sure you've read, and taken the necessary steps to understand, the Important Information and Key Risks of Spread Trading.