LONDON, June 8, 2012 /PRNewswire/ --
Here we look at how you can spread bet Vodafone shares with Finspreads following Telefonica's announcement on Thursday 7 June 2012.
Telefonica to Create Shared Grid in the UK
On Thursday [June 7] Vodafone and O2 owner Telefonica announced plans to create a shared grid in the UK.
The announcement comes two years ahead of regulator Ofcom's requirement of 98% coverage by 2017 and means that the two competing firms will now pool their network infrastructure to speed up the roll out of the 4G service.
This is significant news for Vodafone and O2, substantially improving coverage for the two companies and potentially resulting in a positive impact on their share prices in the longer term.
As an investor, this could provide the ideal opportunity to take a position on Vodafone shares, enabling you to profit from any upward movement in their share prices.
Share trading is, however, risky business and there's always the possibility that a company's share price may fall, netting you a potential loss instead of profit.
The overhyped launch of Facebook's IPO was the perfect example: Facebook shares tanked to $26 per share in the first week of June, down by over $10 from the launch price of $38 and leaving many investors licking their wounds.
Spread betting enables you to profit from falling share prices
Spread betting is an excellent alternative to conventional shares trading, enabling you to profit even if a company's share price tumbles lower.
By opening an online spread betting account with providers such as Finspreads, you can take a position on thousands of global markets, including indices, shares, currencies, commodities and more.
With spread betting, you simply need to choose a financial instrument (for example Vodafone shares, the FTSE 100 stock index, gold or forex) and determine the direction in which you expect prices to move in the future. In this case, let's say you expect Vodafone shares to go up following the 4G announcement for example. Based on your opinion, you would take a 'buy' position or go long on Vodafone shares. If, on the other hand you expected Vodafone shares to fall in spite of the announcement, you would go short or open a 'sell' position on Vodafone shares with Finspreads.
If you were right and prices moved in the direction you had indicated (i.e. if you had gone short Vodafone shares and prices fell, or if you had gone long Vodafone shares and prices rose) you net a profit; else you net a loss.
Unlike conventional shares trading, financial spread betting is free from stamp duty and offers the additional benefit of tax-free* profits. Find out more about the benefits and risks of spread betting with Finspreads.
Spread betting is a leveraged product which can result in losses greater than your initial deposit. Ensure you fully understand the risks.
*Spread betting is exempt from UK stamp duty and Capital Gains Tax (CGT). However, tax laws are subject to change and depend on individual circumstances. Please seek independent advice if necessary.
Finspreads is a leading online financial spread betting firm, offering access to thousands of instruments on the world's financial markets.
The company pioneered fully interactive online spread betting in 1999 and continues to invest in technology to ensure that its service remains amongst the market leaders.