Spread Betting Benefits & Risks

Advantages of spread betting

Why might financial spread betting with InterTrader.com appeal to you?

InterTrader.com quotes Futures contracts as well as Rolling Daily contracts, and you can choose to trade all your markets in the same currency.

For further information on the full range of markets we offer, please see
our Market Info tables.

Wide range of markets


Wide range of spread betting markets



No commission or fees

InterTrader.com does not charge any commission or brokerage fees when you open and close trades. We make our profit from the low spreads we apply. There are no fees for holding an account, so you can leave your account with a zero cash balance at no cost.


Bull or bear

You can go long or short of any market, to profit from both rising and falling prices.


Trade on margin

Trading on margin greatly increases the leverage of your investment capital, as your initial outlay reflects only a fraction of your total exposure on a market.

For example, if you buy 500 shares of HSBC at 800p, your total investment is £4000. The equivalent spread bet would be to buy £5 per point at 800p. This gives you the same total exposure of £4000, but you only need 3% of this amount, or £120, in your InterTrader.com account in order to open the position. With only £120 of margin required to open a trade worth £4000, this means that you have freed up £3880 of your capital to put to use elsewhere.


Tax-free profits*

Any gains you make from financial spread betting are completely free of UK Capital Gains Tax and stamp duty. Your profits are 100% tax-free.*


Automatic risk protection

At InterTrader.com we automatically generate a stop-loss for each position you open, so that your financial risk is significantly reduced. You can amend your stop level to move it either closer to your opening level or further away (subject to available funds being on your account). Note that stops are subject to slippage and market gaps unless you specify for your stop to be a Guaranteed Stop.

Other benefits of spread betting with InterTrader.com include:

  • Low-cost trading with tight spreads
  • Trade in small stake sizes usually unavailable in the underlying market
  • Regulated by the Financial Conduct Authority (FCA)
  • Full trading support including charts, news and research tools

Comparison with traditional stockbroking

Traditional stock investment
(UK stock held for 30 days)

Buy 10,000 shares @ 140p
Cash outlay £14,000
Sell 10,000 shares @ 200p
Gross profit £6000
Stamp duty (£70)
Commission (buy/sell) (£100)
Tax @ 18% (£1080)
Overnight financing NA
Net profit £4750
Return on Capital Employed 34%
InterTrader.com spread bet
(UK stock held for 30 days)

Buy £100 per point
@ 140.1p
Cash outlay (3% margin) £420
Sell £100 per point
@ 199.9p
Gross profit £5980
Stamp duty NA
Commission (buy/sell) NA
Tax @ 18% NA
Overnight financing (£90)
Net profit £5980
Return on Capital Employed 1424%

What are the risks?

Although you can make substantial profits from financial spread betting, it is important to note that it carries a high level of risk to your capital, so you should only trade with money you can afford to lose. InterTrader.com attempts to limit client losses by applying an automatic stop-loss to each trade you place, but you may lose more than your initial deposit if the market gaps through your stop level, unless you make your stop guaranteed.

In the above example, consider that, although your initial outlay is just £420 at our minimum margin requirement, you could lose more than this amount due to sudden adverse market movements. In an extreme scenario you could still lose your full exposure of £14,000, for example if the public company goes bust and shares become worthless. Remember in this extreme event a Guaranteed Stop would still protect you.

Before you apply for an account, please ensure that you familiarise yourself with the risks involved and that spread betting matches your investment objectives. You may wish to seek independent financial advice before applying for an account. If you are new to trading, we recommend that prior to applying for a live account you open an online Demo Account and follow our User Manual.

If you want to know more about the risks involved, please read our full Risk Warning.