Of all the options for betting in the financial markets, financial spread betting has stood the test of time, and in the last 30 years has both expanded and matured, not only in terms of the number of spread betting companies and the increasingly diverse markets available, but also in way the spread betting industry has matured and cleaned up its rather tarnished image. In the early days of spread betting back in the 1970′s and 1980′s, very few traders understood the risks involved, with companies themselves largely to blame. Until the advent of spread betting, novice traders and speculators had little concept of the meaning of leverage or margin, simply being seduced by the marketing hype from the spread betting companies with the prospect of earning large profits from a very small initial deposit. The companies themselves failed to point out of course that whilst this was possible, the opposite was equally likely with large losses being built up just as quickly. Much the same has happened in the $orex marketthe last few years, with a plethora of FX brokers entering the market, mostly unregulated, and offering leveraged accounts up to an eye watering 400:1. The CFTC in the USA has recently introduced new regulations to ban this practice, and to limit margined accounts to a maximum of 1:100 in order to protect traders from these dangerous practices, which has driven many of these unscrupulous brokers offshore to the tax haven countries as a result.

In the UK, the spread betting industry is now regulated by the Financial Services Authority, and due to a combination of this regulatory body now controlling the excesses of the industry, coupled with the industries own efforts to improve its image, the spread betting market now clearly advises new clients of the dangers and risks involved in this financial betting strategy. In addition, all these companies now offer a huge range of training course, seminars, demo accounts and support tools to help you learn how to spread bet safely as well as explaining the dangers and risks associated with the market. It is interesting to note however, that as yet, $inary bettingnot regulated by the FSA, and whilst this may come about in time as the market matures and develops, binary betting has fewer risks that that of spread betting as the account is based on cash trades with no margin or leverage required, so a much lower risk form of financial betting.

So why is financial spread betting so popular and continues to remain so amongst both professional and novice traders and speculators? The simple answer is probably the ease with which you can trade both sides of the market, going long or short with equal simplicity. Until the advent of spread betting, it was very difficult for the small trader to sell short, and this form of trading was really only available to those professionals trading in the large derivatives markets such as futures and options, closed markets as far a novice traders were concerned. Whilst this is undoubtedly one of the major benefits of spread betting, this has to be counterbalanced with the risks involved of leverage and margin, with all spread bets financed with money borrowed from your spread betting company, and as result you can lose more than your initial starting capital. That said, provided you use simple spread betting strategies based on hedging, or protect all your open positions with good stop loss and money management techniques, then the risks involved are no greater or lesser than in other margin based derivatives trading.

The number of markets now offered by the spread betting companies is increasingly diverse, and coupled with the alternative trading methodology offered by binary betting and also fixed odds financial betting, provides some unique trading strategies for us a speculators in the markets. So let’s see what market betting opportunities are currently offered by the spread betting companies, and if you would like to read my comparison on all the companies currently available, then simply follow the link here.