IG said says that its spreadbetters represented professional Middle England. Our typical client is 37, he is male. He works in a managerial or professional capacity or runs his own business. Just 10pc of customers are female. He absolutely doesn't work in the City. As it says here, only 2. That is as measured by people who get compliance copies sent to their compliance department. Compliance rules in the banking sector make it difficult for City people to trade with us. And as I said, overwhelmingly male.
So there's a progressive shift there. Most use spreadbetting as an extra tool in their investment portfolio and are equally adept at shorting or going long on a stock. Increasingly, they are also trading forex currencies, indices and commodities.
According to Andrew Edwards, who is the CEO of ETX Capital, dislocation, market volatility and crisis have not put off the punters - just made them much more smarter in their decisions. This coming from a spread betting provider that originally used to cater for high net worth individuals is a strong claim. About 3 years back about three-quarters of ETX's business was still being conducted on the phone.
They know it is not as easy to make money as perhaps it was, and disposable incomes are less. People are more careful in what they are investing in. All that people have gone through, all that has happened in the financial markets has made customers sophisticated. They may originally just have been long equity players, but what has happened in markets has made them far more educated.
Rival firm CMC Markets, 10 per cent owned by Goldman Sachs is thought to be the second-largest provider opening 4, to 6, accounts for private clients each month July - although CMC being a private company it is under no obligation to publish its financial results. Two other long established competitors are Cantor Index and City Index. In Mid City Index acquired Finspreads so now both companies operate under the same umbrella. Capital Spreads is a more recent entrant having launched in but has been rapidly gaining market share to the extent that it has now displaced Cantor from fourth place.
In the past five years the industry has experienced rapid expansion with that started with the launch of Capital Spreads in Capital Spreads offers very competitive spreads and subsequently good value for clients and its introduction has helped bring spreads down.
Note: This survey conducted by Investment Trends was contracted by major spread betting firms including IG Index and it involved surveying almost 9, investors. IG globally has c k accounts. CMC markets claims c 76k accounts and 26m trades annually, while City Index does 1. Capital Spreads claims over 29k trades per day. However, white-label sites mean that about 49 per cent of clients also have a CityIndex account, even if they are not branded as such.
According to the research report by Investment Trends the success of IG Index's trading platform, PureDeal, and its accessibility to non-professional investors, has been credited with much of IGIndex's feat in dominating the UK spread betting industry. It is also interesting to note that most investors stated that use a spread betting account as it allows them to short asset classes and also because it allows them to magnify investment returns whilst giving them access to a huge range of markets.
Trading on indices such as the FTSE is still very popular with spread betters, with about 76 per cent taking bets on indices, while 61 per cent said they bet on foreign exchange moves. The scale of competition can also be seen by the very tight pricing and terms across the market. In particular, the spread betting market has become increasingly competitive with more firms offering good value through tight spreads. Brokers margins are being reduced as these factors mean that revenue per trade is reduced and cost of client acquisition increases.
There is less differentiation between firms and USPs are harder to find. Increasingly, therefore, it may be the top 5 firms who do well and some of the smaller firms may be weeded out. This could become an issue for regulators. However, a survey by research specialist Investment Trends conducted in late estimated that there are only about 93, active spread betters placed one trade in the past 12 months , which is fewer than one might think.
And of these 93, spread betters, only a tenth also trade contracts for difference derivatives contracts that work like spread bets. Spread betters also tend to open multiple accounts; in fact the survey concluded that clients opened on average 2. Spread betting trades increased by per cent throughout while contracts for difference increased by 30 per cent, largely because of their tax benefits, the ability to short the markets and low up-front payments.
With the ever-increasing growth in the spread trading industry, spread betting brokers are now dealing with different types of people starting from starter investors to highly active traders. For this reason, the offering has to be relatively broad to appeal to different kind of clients. The spread betting market has also become very competitive over the last years, with an increasing number of providers offering very tight spreads which reduces broker margins meaning that revenue per trade is lower and cost of client recruitment increases accordingly.
There is less differentiation between firms and unique selling propositions are harder to find - online spread betting today is no longer simply about giving clients with the access to the market and the platform to trade; it's about providing much more in the way of tools and information and education and services. Clients are also demanding more - today clients aren't satisfied with tight spreads and the ability to act quickly on market opportunities, traders and investors today are also demanding more research, and on a bigger range of shares.
Investors today want research, stock trading ideas, alerts on stocks whose price and volume are behaving unusually. And while the law doesn't allow spread betting providers to give advice, they can definitely provide trading ideas. The general level of education and market awareness and about how things work is also quite higher than it was 5 years back. For instance, these days I hear people saying that when they're looking at a particular share, they will mention the management team: 'I like this share because the management team has past experience, and they've done this and that', or 'This guy has come to this company, he's had a lot of experience in this industry'.
That's not how normal people think; that's how hedge fund managers think! As the volatility in the markets subsides betting patterns are again returning to more usual levels with the average stake sizes again increasing as the markets stabilise and volatility dies down. Index markets like the Dow for instance have stopped moving some points per day and the daily trading range has tightened to less than points.
Longer term swing trading as opposed to day trading is also becoming more popular once again. I find this very interesting and new spread betting firms are likely to repeat these mistakes while on the hunt for new customers. Some might already have and haven't been taken to account. What could the reason for this be, as we're frequently told one of the main advantages of spread betting is that you can bet on the direction of the market, regardless of whether it's moving up or down.
Some of the popular explanations include:. Speaking with professional traders, some suggested inexperience may result in the high trend to "buy" positions, possibly that novices aren't comfortable selling something they don't own. If we consider the typical demographic of spread betters as "high net worth males with previous investment experience" Capital Spreads , it would seem to be selling spread betters short to suggest they can't grasp the concept of the market going down as well as up.
Although the previous investment experience may have conditioned betters to the notion of buying only. Do inexperienced spread betters feel that buying positions are less risky? Surely our greatest fear is for the market to gap and as recent events with Northern Rock have shown, unexpected news stories are more likely to result in share prices sharply hitting the floor, rather than dramatically rising.
Hence being short a position should have less negative exposure to market gapping - so quashing this theory. I think the reason that most spread bets are "buy" is due to a far more fundamental personality trait. As a quick experiment, answer the following question: "What percentage of spread betters lose money?
If you guessed close to this figure, the theory would suggest that you're a pessimist; and the surmise would be that a pessimist can envisage the movement of a market in a negative direction to a greater extent than an optimist; so being more inclined to "sell" positions. If your estimate differed wildly from the answer; or indeed if you knew the answer but continues to spread bet; it would suggest that you happily predict good news and bullish markets, hence having a tendency to go long.
By the very high risk nature of spread betting, I think we can predict the vast majority of traders are optimists to believe we can make money this way, and hence the skew to "buying" positions. Therefore, perhaps the question we ask ourselves should not be "to buy, or not to buy", but rather "to buy, or to sell? The spread betting and CFDs marketplace may no longer be a man's world according to the Financial Times.
Over the last few years the number of women opening derivatives accounts has risen dramatically, and is estimated to be growing at 10 per cent year on year and this is partly driven by the increased media coverage about personal finance and investing. He continues: 'With online dealing there is no 'old boy's network' to be concerned about and female clients do not need to worry about prejudice.
This interest is being reciprocated by the spread betting firms. Angus Campbell, head of sales at Finspreads, says female investors are a sought-after commodity and they actually appear to be outperforming their male counterparts. The FT quotes research from IG Index December which backs the claim that women are better spread betters than men; according to IG Index, on average, female traders win twice as much or lose half as much as their male counterparts.
A risk is most likely to be taken by men, according to a recent study conducted by Barclays Capital and Ledbury Research. However, this doesn't mean that women are incapable of taking the plunge into speculative trading, it just reflects that they are more careful and cautious in avoiding catastrophes.
The study indicates that women would make better investors, as opposed to men, who have already partially led us into the credit crunch. The study found that men are over-confident. Although this can pay off, at times, it can also backfire too. Researcher Chun Xia, a former professor in Hong Kong, claimed that women are prone to stress quickly, more than men.
As a result they tend to be more conservative in financial deals in the hope of avoiding anxiety provoking situations. Men, on the other hand, are the ones who need more discipline when it comes to money since they tend to be overly confident in their financial decisions, the study found. The current study follows a study by Merrill Lynch, a financial management and advisory firm. More recently, in , a study by the mutual fund company Vanguard involving 2.
Biology could also be playing its part in how men and women make their decisions. Men's overconfidence could all boil down to hormonal impulses which trigger off these quick decision making moments. According to Time magazine, there is a growing sector of study called 'neuroeconomics' in which scientists are examining the links between hormonal and neurological impulses. One such recent study by John Coates, a research fellow in neuroscience and finance at Cambridge University tested male trader's hormone responses to workplace decisions.
He found that testosterone drives winning streaks and then risk taking. Men are more inclined to be confident about their decisions, albeit this doesn't mean they are more accurate, in their financial decisions while women tend to value wealth as a basis for security, as opposed to opportunity.
The so-called 'winner effect,' which has been seen in athletes during competition, also seems to apply to male traders. As the UK's Guardian explained:. This happens when two males enter a competition and their testosterone levels rise, increasing their muscle mass and the ability of the blood to carry oxygen. It also enhances their appetite for risk.
Much of this testosterone stays in the system of the winner of a competition, while the loser's testosterone melts away fast; in evolutionary terms, the loser retires to the woods to lick his wounds. In the next round of competition, though, the winner already has high levels of testosterone, so he starts with an advantage, and this continues to reinforce itself. But as the levels rise you get sharper and more focuses until you reach an optimum.
The key thing is this, however: 'If you keep winning, your testosterone level goes past that peak and sliding down the other side. You start doing stupid things. When that happens to animals, they go out in the open too much. However, this is not a desirable outcome for the sports book, as they are forced to refund every bet, and although both the book and its bettors will be even, if the cost of overhead is taken into account, the book has actually lost money by taking bets on the event.
Sports books are generally permitted to state "ties win" or "ties lose" to avoid the necessity of refunding every bet. Betting on sporting events has long been the most popular form of spread betting. Whilst most bets the casino offers to players have a built in house edge, betting on the spread offers an opportunity for the astute gambler. When a casino accepts a spread bet, it gives the player the odds of 10 to 11, or That means that for every 11 dollars the player wagers, the player will win 10, slightly lower than an even money bet.
If team A is playing team B, the casino is not concerned with who wins the game; they are only concerned with taking an equal amount of money of both sides. This is the house edge. The goal of the casino is to set a line that encourages an equal amount of action on both sides, thereby guaranteeing a profit. This also explains how money can be made by the astute gambler. If casinos set lines to encourage an equal amount of money on both sides, it sets them based on the public perception of the team, not necessarily the real strength of the teams.
Many things can affect public perception, which moves the line away from what the real line should be. This gap between the Vegas line, the real line, and differences between other sports books betting lines and spreads is where value can be found. A teaser is a bet that alters the spread in the gambler's favor by a predetermined margin — in American football the teaser margin is often six points. For example, if the line is 3. In return for the additional points, the payout if the gambler wins is less than even money , or the gambler must wager on more than one event and both events must win.
In this way it is very similar to a parlay. At some establishments, the "reverse teaser" also exists, which alters the spread against the gambler, who gets paid at more than evens if the bet wins. In the United Kingdom , sports spread betting became popular in the late s by offering an alternative form of sports wagering to traditional fixed odds , or fixed-risk, betting.
With fixed odds betting , a gambler places a fixed-risk stake on stated fractional or decimal odds on the outcome of a sporting event that would give a known return for that outcome occurring or a known loss if that outcome doesn't occur the initial stake. The spread on offer will refer to the betting firm's prediction on the range of a final outcome for a particular occurrence in a sports event, e.
The more right the gambler is then the more they will win, but the more wrong they are then the more they can lose. The level of the gambler's profit or loss will be determined by the stake size selected for the bet, multiplied by the number of unit points above or below the gambler's bet level. This reflects the fundamental difference between sports spread betting and fixed odds sports betting in that both the level of winnings and level of losses are not fixed and can end up being many multiples of the original stake size selected.
For example, in a cricket match a sports spread betting firm may list the spread of a team's predicted runs at — If the gambler elects to buy at and the team scores runs in total, the gambler will have won 50 unit points multiplied by their initial stake. But if the team only scores runs then the gambler will have lost 50 unit points multiplied by their initial stake. It is important to note the difference between spreads in sports wagering in the U.
In the U. In the UK betting above or below the spread does not have a known final profit or loss, with these figures determined by the number of unit points the level of the final outcome ends up being either above or below the spread, multiplied by the stake chosen by the gambler. For UK spread betting firms, any final outcome that finishes in the middle of the spread will result in profits from both sides of the book as both buyers and sellers will have ended up making unit point losses.
So in the example above, if the cricket team ended up scoring runs both buyers at and sellers at would have ended up with losses of five unit points multiplied by their stake. This is a bet on the total number of points scored by both teams.
Suppose team A is playing team B and the total is set at If the final score is team A 24, team B 17, the total is 41 and bettors who took the under will win. If the final score is team A 30, team B 31, the total is 61 and bettors who took the over will win. The total is popular because it allows gamblers to bet on their overall perception of the game e.
Example: In a football match the bookmaker believes that 12 or 13 corners will occur, thus the spread is set at 12— In North American sports betting many of these wagers would be classified as over-under or, more commonly today, total bets rather than spread bets.
However, these are for one side or another of a total only, and do not increase the amount won or lost as the actual moves away from the bookmaker's prediction. Many Nevada sports books allow these bets in parlays , just like team point spread bets.
This makes it possible to bet, for instance, team A and the over , and be paid if both. Such parlays usually pay off at odds of with no commission charge, just as a standard two-team parlay would. The mathematical analysis of spreads and spread betting is a large and growing subject. For example, sports that have simple 1-point scoring systems e. By far the largest part of the official market in the UK concerns financial instruments; the leading spread-betting companies make most of their revenues from financial markets, their sports operations being much less significant.
Financial spread betting in the United Kingdom closely resembles the futures and options markets, the major differences being. Financial spread betting is a way to speculate on financial markets in the same way as trading a number of derivatives. In particular, the financial derivative Contract for difference CFD mirrors the spread bet in many ways. In fact, a number of financial derivative trading companies offer both financial spread bets and CFDs in parallel using the same trading platform.
Unlike fixed-odds betting, the amount won or lost can be unlimited as there is no single stake to limit any loss. However, it is usually possible to negotiate limits with the bookmaker:. Spread betting has moved outside the ambit of sport and financial markets that is, those dealing solely with share, bonds and derivatives , to cover a wide range of markets, such as house prices.
Additionally, by avoiding the favourite-longshot bias , where the expected returns on bets placed at shorter odds exceed that of bets placed at the longer odds, and not betting with one's favorite team, but rather with the team that has been shown to be better when playing in a specific weather condition and time of day, the possibility of arriving at a positive outcome is increased.
In the UK and some other European countries the profit from spread betting is free from tax.
Gaming Commission expect to be briefed on the proposals filed on Beacon Hill related to sports betting and could get an update on a commission effort to refile a bill that would change the way horse racing is managed. The sports betting bills that Gov. Charlie Baker and Sen. Brendan Crighton filed last month, and many others that have been filed since the U. Supreme Court allowed states to legalize the activity, would put the Gaming Commission in charge of licensing and overseeing sports betting operators in Massachusetts.
The commission has not participated in the drafting of any sports betting bills but has been studying the issue for years in anticipation of it being made legal here. Over the years, lawmakers have extended the racing and simulcasting laws for a year at a time, often waiting until just before or after the deadline to pass extensions. In and , lawmakers missed the deadline, and racing and simulcasting were briefly illegal in Massachusetts.
For about five years, the commission has been asking lawmakers to give serious consideration to giving it broader powers to regulate the racing industry and put an end to one-year extensions of racing and simulcasting authority. Structuring trades to balance profit-and-loss levels is an effective strategy for spread betting, even if the odds aren't often in your favor. Who's the more successful trader?
The answer seems to be Mike, but that might not be the case. Structuring your bets with favorable profit levels can be a game-changer. Spread betting often concerns the price moves of an underlying asset, such as a market index. Active spread bettors like news traders often choose assets that are highly sensitive to news items and place bets according to a structured trading plan.
For example, news about a nation's central bank making an interest-rate change will quickly reverberate through bonds, stock indices, and other assets. Another ideal example is a listed company awaiting the results of a major project bidding. Whether the company wins or loses the bid means a stock price swing in either direction, with spread bettors taking positions based on both outcomes.
Arbitrage opportunities are rare in spread betting, but traders can find a few in some illiquid instruments. For example, say a lowly tracked index is currently at value One spread-betting firm is offering a bid-ask spread of for the closing price, while another offers a spread. However, such arbitrage opportunities are rare and depend on spread bettors detecting a pricing anomaly in multiple spread betting firms and then acting in a timely manner before the spreads align.
The high profit potential of spread betting is matched by its serious risks: the move of just a few points means a significant profit or loss. Traders should only attempt spread betting after they've gained sufficient market experience, know the right assets to choose, and have perfected their timing. Long-Arm Regulatory Risk. Government of the U. City Index by Gain Capital. Hedge Funds Investing.
Trading Instruments. Your Money. Personal Finance. Your Practice. Popular Courses. Table of Contents Expand. What Is Spread Betting? Technical Analysis Strategies. Spread Betting Around Corporate Actions. Structuring Entry and Exit. News-Based Strategies. Arbitrage Opportunities. The Bottom Line.
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Gannett may earn revenue from audience referrals to betting services. Newsrooms are independent of this relationship and there is no influence on news coverage. The Thunder and Rockets will face off for the second game in a row. Houston beat Oklahoma City by 30 points on Monday. They'll take the floor against the Rockets for the first time this They've played well this week and turned around after dropping four of five games excluding the Please enter an email address.
Something went wrong. The game tips off at 7 p. More Stories Thunder vs. Rockets: Point spread, betting odds, prediction Feb. January 15, Even though it's a rematch, lineups will look quite different, as both From The Web Ads by Zergnet.
Thunder vs. Nets: Point spread, betting odds, prediction Jan. Share this article 5 shares share. Most Popular. Email Sign up No, thanks. It will be a good Super Bowl for them. It is down a half a point to 56 right now. The general public favors the Chiefs to win and score a lot of points.
And that extends to a lot of the prop bets. Tyreek Hill the same. So what do the trends say about how one might approach the Super Bowl? The winner of the game covers the point spread 45 times. Only six times did they fail, two, and three times it was a tie. Now the under and over, the last seven times the total was over 50 points.
Six in the seven games went under, so there is a lot of pressure. White was even kind enough to share how he looking at the game. I like Patrick Mahomes under the passing yards. I like a combo bet, Tom Brady most passing yards in the game to Travis Kelce most receiving yards. And then I like total players to attempt to pass.
We might see a Philly Special, who knows? We might see a second-string quarterback come in the game. Which Super Bowl prop is a must-back and pays almost ? And which other prop bets do you need to jump on for the big game? Viewers can livestream the game through CBSSports.
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