LONDON, June 23, 2011 /PRNewswire/ --
Everyone is looking for ways to make their money work harder for them. Spread betting is a cost-effective method of financial speculation, as it is free of both stamp duty and Capital Gains Tax*. If you are a seasoned trader, but are unfamiliar with financial spread betting, City Index (http://www.cityindex.co.uk/) has a few pointers for you to bear in mind.
Use stop losses
You can place stop losses to close your trades at set price points, therefore never risking more of your capital than you intend to.
Never put all your eggs in one basket
If you place a large spread bet or CFD trade in one market, your success or failure depends solely on the movement of that one market. Spread your trades and you will diversify your risk.
Trade within your means
Many traders use up their margin with a single opening trade. The reason this is detrimental is that it leaves you with little surplus in your account to allow for price fluctuations. Always hold back extra margin to cover your position should the markets go against you, or your trade could be closed out.
To learn more about the differences between spread betting and standard trading, visit:
* Spread betting and CFD trading are exempt from UK stamp duty. Spread betting is also exempt from UK Capital Gains Tax. However, tax laws are subject to change and depend on individual circumstances. Please seek independent advice if necessary.
About City Index:
Today more and more individual traders are discovering the benefits of derivatives, many of them discovering them through a City Index trading platform.
As a group, we transact in excess of 1.5 million trades in over 50 countries every month. We provide access to many instruments including CFDs and financial spread betting.
We constantly look to improve our platforms and expand our range of services. The result is that our customers benefit from innovative trading tools with transparent pricing, competitive spreads, and a high standard of customer support. Visit http://www.cityindex.co.uk/ to find out more about a City Index spread betting account.
SOURCE City Index PR