| "A form of investing which is more akin to betting, and can be applied either to sporting events or to the financial markets. At its core is the maxim the more right you are, the more you win. In the simplest terms, a spread betting firm quotes two figures for, say, the position of a stock index at close of trading on a certain day. If its spread is 6005-6011 and you think that the market is going to end up higher on the day than 6011, you might buy (go high) at 6011 and choose a stake per point of œ5.00 (the tick value). If you think that it is going to end lower on the day than 6005, you might sell (go low) at 6005 and choose a stake per point of œ5.00. If it actually closes at 6034, and you bought at 6011 you were right by a margin of 23 points, and therefore win œ115 |
