The increase in number of people choosing financial spread betting as a way of making money in the financial markets has seen a rise in the number of spread betting companies too. This has made it more difficult for you to go through and select one often causing the beginner some headaches.
Is the number of spread betting companies a bad thing? While it does imply they are making profits to attract in further competitors, increased competition has its advantages. As consumers we are better off because they are offering us more to select them.
Spread betting companies are required to be regulated. The Financial Services Authority (FSA) has the regulatory responsibility. I wouldn’t have thought that there are any companies these days who aren’t regulated but you should still check.
People dismiss dummy accounts as only being there for beginners. I think it is necessary for people new to this to set up a dummy account first of all. It isn’t the practicing of trading that should be appealing to experienced traders. You have the ability to really see what the spread betting companies are like prior to opening an account with them.
Is it wise to select from spread betting companies on cashback alone? In recent times it seems like all companies have some sort of cashback offer to attract new accounts. Yes it is great but remember you get it for a reason. They expect to make more money from you in the long run. Feel free to take it but only if you would’ve selected that account anyway.
At the end of the day your main consideration should be your on going costs. When I say costs you don’t have to pay commission, you pay via the spread in the trade. As soon as you initiate a trade you will be in a losing position. The smaller the spread the less the asset must move for you to make money. The best traders choose spread betting companies this way… who offers the lowest spread.
