The Types Of Spread Betting Account Available.
If you are looking to open your first spread betting account or are thinking about trying out a new provider, you need to be aware of the different types available. Some brokers offer a range of different options, some only offer one kind. As always you should thoroughly research what is available and what suits your needs.
The Standard Deposit Spread Betting Account
This is the type of account all brokers offer. You open an account, deposit funds and your trade size will be determined by the “margin” you have at your disposal. The larger your deposit, the more size per point you will be able to trade. Each provider will usually have its own margin levels, so you need to make sure you check what they are and carefully decide whether your trading plan and funds will allow you to start spread betting sufficiently and correctly with the broker. Any losses will be deducted from the balance of your account.
A Credit Account
As the name suggests, this type of account allows you to place spread bets and margin is determined by the amount of credit a broker will give you. You should be very experienced in the markets to use this type of account, and brokers will not normally give you this type without proof of capital available to cover any losses.
Guaranteed Stop Loss Deposit Account
This account is the least risky. It works similar to a standard deposit account yet will not let you enter a trade without a guaranteed stop loss being placed. A guaranteed stop will be honoured by the broker in every case. Sometimes with a standard account a fast moving market may gap past your pre determined stop loss, and cost you more than you originally planned. Guaranteed stops eliminate this risk.
For further information about how to open a spread betting account, the best brokers and platform features, spread betting on equites, shares and other markets take a look inside some of our other guides on this site.