Over the last few years we’ve seen a dramatic rise in derivatives trading.
The top financial instruments to trade today in this world are in fact, Spread Bets and CFDs.
In Singapore, London and even Asia we are seeing brokerage houses move to these derivatives on a weekly basis.
Today I want to highlight my top five reasons why Spread Trading is the way to go…
Five reasons why traders Spread Bet
The beauty about Spread Betting is that you have a huge variety of instruments to choose from.
With BlackStone Futures for instance you can choose to Spread Bet from Forex, indices, shares, commodities, and maybe in the future, crypto-currencies.
You don’t actually own anything physical when you deal with Spread Bets.
The name should give it away…
All you’re doing is making a bet, on a risk per point basis, on whether a market is going up or down.
So you won’t have to worry about costs like you do with shares, such as:
Stamp duty, STRATE, STT, the full value of the shares and even brokerage…
The only thing you’ll make a small deposit when you spread bet is the tight bid and offer spread.
TRADE UP OR DOWN
Normal investors buy shares in a market and hold for long periods of time. They have no choice but to wait for the market to turn up.
With Spread Betting, you won’t have to care which way the market goes.
As you’re betting on the direction of a market, you can trade by going long (buying) with the expectation the market will rise.
Or you can trade by going short (selling) with the expectation the market will drop.
NO CLOSE OUTS
Unlike many other derivatives, Spread Trading instruments don’t have expiry dates…
So you don’t have to worry about your contracts automatically closing you out every three months.
LOW ENTRY ACCOUNT
Spread Betting is perfect for those who don’t have a lot of money to start investing in.
Today you can start Spread Betting with as little as R1,000, even less.
But make sure, you consider the costs if you decide to trade with small amounts.
But feel free to start off small and as time progresses, so will your level of confidence and profits…
“Wisdom yields Wealth”
Analyst, BlackStone Futures