FTSE spread betting has some advantages and disadvantages when comparing to other method of trading the index. We will look at some of those now and hopefully you should get a balanced opinion on whether it is suitable for you.

So what it FTSE spread betting? Well you will be trading or ‘betting’ on the movement of the FTSE. This is a well known index in the UK made up to large firms. Here you are not interest in the movement of individual companies, you feel the effect of the moverment of all the companies combined.

But what if I only want to trade in one or two companies? Well in that case then FTSE spread betting is probably not for you. You may want to open a stockbroker account where you can trade individual shares or take advantage of financial spread betting areas.

How do trackers compare to FTSE spread betting? Well both have exposure to the index but they are very different. A tracker is a great option for those people who do not really want to take an active position in their trading.

So if the tracker is potentially better for most people then why should I consider FTSE spread betting? Well FTSE spread betting has a number of advantages. Firstly you don’t have to pay tax on your profits. Please note that this can also true for trackers if you hold them in an ISA.

The other advantages include access to lots of markets from the one account, you don’t have to pay commission and you can use leverage to assist your position. Please note that using leverage can be risky.

You should go and see a financial advisor if you are unsure of any of the rules around tax related to FTSE spread betting.