Understanding The Risks of Spread Betting
Disclaimer: Leveraged instruments are risky. Conduct your own research before trading on margin or with leverage. Trading with leverage is at your own risk.
Spread-Bet.co.uk
Spread-Bet.co.uk is built by spread bettors for spread bettors
One of the oldest spread betting broker comparison resources
Detailed facts, charts and technical evaluations for each broker
Trusted guides by actual spread bettors
Top Spread Betting Brokers
Spread-Bet.co.uk reviews the best spread betting brokers in the UK. We personally test all the brokers we list, to give you in-depth insights you can rely on. Our testing teams highlight the pros and cons of each broker, and outline all their features.
All the spread betting brokers we review are FCA-regulated, making them safe and secure for spread betting. Bear in mind that there is always a risk involved with spread betting.
Why Traders Should Compare Spread Betting Brokers
Comparing spread betting brokers is an important step before you open an account. This will give you a strong understanding of the overall spread betting experience each broker offers.
Choosing the wrong broker can lead to poor execution speeds, slippage, and wide spreads — all of which reduce your chance of profit and put you at risk of high costs.
At Spread-Bet.co.uk, we’ve tried and reviewed multiple brokers, considering factors like fees, platforms, and customer support. This means we give you a true “insider” look at how each broker performs.
Our aim is to help you learn about each broker’s strengths and weaknesses, ensuring you find the broker that best fits your own trading strategy and goals.
Why Use Spread-Bet.co.uk?
At Spread-Bet.co.uk, we’re all spread bettors, so we know how important it is to choose the right broker. We expect all brokers to provide top services, maximising your trading experience while minimising your costs.
We’ve tested the most popular spread betting brokers in the UK, so we can provide you with unbiased, in-depth reviews and comparisons.
Our reviews cover everything from platform usability and market access, to fees and customer support. These reviews are a great resource for you, as you weigh up the different trading conditions offered by each broker.
Best FCA-Regulated Platforms
We’ve opened accounts and tested over 16 FCA-regulated platform providers, from Pepperstone to IG Markets. After rigorous testing, we reviewed their performance during typical trading sessions.
All the spread betting brokers we review are regulated by the Financial Conduct Authority, so your betting environment is safe and secure. In this guide, we’ve narrowed our list of top FCA-regulated brokers down to 8, based on spreads, platforms, and overall trading conditions.
Beginners Spread Betting Providers
We have carefully analysed and selected the 6 platforms that we think are ideal if you are new to spread betting.
Our beginner’s guide breaks down the essential features you will need for spread betting like solid trading conditions, low minimum deposits, and tight spreads. We’ve also looked at other features, such as educational resources.
Top Spread Bet Demo Accounts
We’ve tested and compared spread betting demo accounts to bring you the 6 best options for risk-free practice.
This guide highlights key features, market access, and platform functionality. Our aim is to help you find the perfect demo account for honing your skills before using your own capital.
FAQS
What is Spread Betting?
Spread betting is a derivative product that allows you to speculate on the price movements of financial markets without owning the underlying asset. You place bets on whether the price will rise or fall, and your profit or loss is determined by the accuracy of your prediction and the size of your bet.
Spread betting is the only derivative with a tax-free status in the UK, meaning you do not pay capital gains tax on your profits, or stamp duty when placing a bet.
Can you make money spread betting?
Yes, you can make money spread betting if you develop a solid strategy and manage risk carefully. Making money through spread betting involves discipline, market knowledge, and emotional control, so you should start small, use stop-losses, and only risk what you can afford to lose.
Are spread betting profits taxable?
In the UK, spread betting profits are tax-free for most retail traders, meaning you do not have to pay capital gains tax and stamp duty on your trades. However, if spread betting is your main source of income, your profits may be subject to income tax, although you will still be exempt from stamp duty.
We advise that you contact a tax professional if you have any specific questions on taxes and duties, as individual circumstances differ when it comes to spread betting.
Where is spread betting legal?
Financial spread betting is legal in the UK, the only country offering the derivative with tax-free status. It’s prohibited in the United States and many other jurisdictions across Europe.
To start with spread betting, you must use an FCA-regulated spread betting broker and be a UK citizen.
Is Spread Betting Legal In The UK?
Yes, spread betting is fully legal in the UK. It’s regulated by the Financial Conduct Authority (FCA) as a form of financial derivative trading.
UK residents can open spread betting accounts with FCA-authorised brokers and enjoy the benefits spread bets bring, including access to multiple markets and tax-free profits.
Is Spread betting more risky than CFD?
Spread betting and CFDs carry similar risks, as you will be trading largely the same markets. When used with an FCA-regulated broker, both products offer Negative Balance Protection, so you’ll never owe the broker any funds if the markets wipe you out.
The actual risk depends more on your trading strategy, risk management, and the markets you trade, rather than the trading type.
Is Spread Betting FCA Regulated?
Yes, spread betting is regulated by the Financial Conduct Authority (FCA) in the UK, and only brokers licensed and authorised by the FCA can provide spread betting markets.
All FCA-authorised spread betting firms must follow strict rules to protect clients, such as segregating client funds, providing negative balance protection, and offering transparent pricing.
Can I use MT4 for spread betting?
Yes, some brokers offer MetaTrader 4 (MT4) for spread betting, but it’s not universally available. Most brokers prefer you to use their proprietary platforms, which are optimised for spread betting.
MT4 was designed for forex and CFD trading, so there may be limitations on spread betting. For instance, you may not be able to spread bet on equities or ETFs with MT4.
Which is the best spread betting broker?
Based on our testing, Pepperstone is the best spread betting broker. It offers some of the lowest trading costs, along with fast execution speeds and a solid range of trading platforms.
They also offer a great range of trading tools and solid customer support, making them an excellent pick.
What is the leverage on spread betting?
Leverage in spread betting typically ranges from 1:2 to 1:30 in the UK, depending on the asset and broker. The FCA limits retail client leverage to 1:30 on major forex pairs, and sets a lower limit for other assets, like the 1:5 limit on stock spread bets.
Elective professional clients can access higher leverage of up to 1:500, although this may vary between brokers.
Which Is Better Spread Betting Or CFD trading?
Spread betting and CFD trading are very similar in terms of market access, leverage and risk. The main difference for UK traders is that spread betting is tax-free, meaning you save money by not paying capital gains tax or stamp duty.
CFDs are subject to capital gains tax but not stamp duty, and your losses can be written off against your tax.
There is no definitive answer as to which is better, and the choice is a personal one.
Our Spread-bet.co.uk Comparison Methodology
We prioritise low spreads in our evaluation process, as they directly impact your trading costs and profitability. Additionally, we test the execution speeds each broker offers, ensuring that your trades are executed fast across all trading sessions.
We understand that different traders have their own trading styles and preferences, so you need a choice of trading platforms. Therefore, we examine each broker’s range of platforms, including their user-friendliness, features, and customisation options.
As well as this, we evaluate the ease and speed of deposit and withdrawal processing, and the quality of customer support to ensure a seamless experience.
Beyond these main aspects, we also explore the special benefits offered by each broker. These may include access to third-party trading tools, in-house research, guaranteed stop-loss orders, educational resources, and discounted trading costs for high-volume traders.
By considering these additional features, we are able to provide a comprehensive review of each broker’s overall value, and then offer a score out of 100. This makes it easier for you to compare our findings, as you make an informed decision based on your specific trading needs.