Many people have seen their wealth decline massively in the last few years. Less people believe what the ‘experts’ are telling them about financial markets. They want to take control and trade on their own decisions. People are using financial spread betting to do this as there are lots of advantages which I will tell you about.

The reason that a lot of people have done poorly is because they only ever have what is called a ‘long’ position. They buy an asset (go long) and profit if it increases in value. With financial spread betting you can actually go on the opposite side of the trade… you can trade short. This means that you have the ability to profit when an asset declines in value.

So what enables you to go short? With financial spread betting you don’t own the asset. You place a stake in the direction that you think it will move. If you feel the price will decline then you can open a short at £10 per point. If it declines then you make a profit of £10 for every point that it did. For every point it goes up you lose £10.

I know I have probably lost half of you with that last paragraph but please bear with me. Yes it is complicated… well it is when you first start but it is worth learning. Why not practice with a demo account offered by the spread betting companies?

If you are from the UK then there is an extra benefit of financial spread betting. That advantage is they you don’t incur tax of your profits. Tax laws can change so always seek advice prior to you starting.

I have only spoken about some of the pluses of financial spread betting. There are some disadvantages of it that I encourage you to check out before opening an account.