Spread betting is a way of betting on the movements within financial markets without having to actually buy and own any investment. It is continually increasing in popularity, with more and more people seeing it as a second source of income to supplement their main earnings. In fact, there have been several cases where this has worked out so well that spread betting has become the main source of income.
If you open an account with a spread betting firm you can bet on things such as the rise and fall in specific share indexes, such as the FTSE 100, Forex, bonds and even some cryptocurrency markets now, with some spread betting firms actually offering thousands of different potential bets to choose from.
With research and experience, it is possible to make a considerable income from spread betting on markets such as Forex. The knowledge needed to participate in spread betting is also readily available online for anyone to access, as well as the many different tools with which to trade. Spread betting requires practice in order to achieve sustained success, just like any other skill or profession.
One of the advantages of treating spread betting as a second source of income is that you can learn and trade at your own pace. This means if you have to learn about it, for example by visiting spread betting sites like Cityindex.co.uk, and/or gather more information on markets, trading strategies or tools; it can be at your own pace, and thus no one is rushed into trading without being totally prepared. All of this is now possible with the growth of online trading platforms, which offer stable and comprehensive services for all interested parties ranging from part-time novices to full time experienced traders.
Spread betting is also very attractive to those looking to generate additional income as any profits realised are currently completely tax-free and not subject to capital gains tax, as long as it is not your main source of income. If spread betting is your only or main form of income though then it is very likely any tax benefits will disappear.
If you are employed and currently paying PAYE, then you will not be taxed. This is because the companies that offer spread betting actually pay betting duty directly to the HM Revenue and Customs and the bid offer spread is slightly higher in order to cover the tax. With spread betting you are not actually making any physical sale or purchase, so you do not incur some of the tax drawbacks of trading actual physical assets.
It is entirely possible to make a second income and more from spread betting, but not something that should be entered into lightly or without doing a lot of research prior to starting. You must spend a lot of time researching spread betting, looking what the professionals do, researching different spread betting tools and the markets in which you will operate and even try a free trial with a broker.
With a free trial you can do a dummy run of the trades you would be looking to make and then see if you would have been successful over that period or not, by keeping track of your results.