Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75.3% of retail investor accounts lose money when trading spread bets and CFDs with this provider. You should consider whether you understand how spread bets and CFDs work, and whether you can afford to take the high risk of losing your money.


Spread betting Forex with Pepperstone

Trading Guides
23 Aug 2022

What is spread betting Forex?

 Spread betting Forex is a tax efficient way of trading and investing in currency moves without making any transaction directly within the Forex markets. By placing a spread bet, you are speculating on the move of the underlying market but without actual ownership, or physical exchange. The bet is a transaction between the trader and the broker.

What are the three main components of spread betting Forex?

This first component is the spread. Broker quotes have two prices, the bid and the offer. If you are looking to sell the underlying asset, you would trade at the bid. Buying the asset, and you trade at the offer. The difference between the two prices is known as the ‘spread’.

The second component is the direction of the trade. Buying or going long if you think the price will rise. Selling or going short if you think the price will fall.

The third component is the size of the bet. The trade size is placed per pip. For example, I buy EUR/USD at the offer of 1.2010 in £2 per pip. The price moves higher, and we close the trade at the bid price of 1.2030. We would have made £40. That is a 20 pip move in £2 per pip (20 x 2 = 40).


Figure 1 spread betting with Pepperstone

What are the benefits of spread betting Forex with Pepperstone?

There are numerous benefits to spread betting Forex through Pepperstone. We offer consistently competitive spreads, potentially reducing your cost to trade. You have peace of mind trading through a regulated broker. Your profits can be tax free depending on your individual circumstances.

We also offer automated trading, for those wanting to build and run their own Expert Advisor (EA).

For more information on spread betting forex through Pepperstone, click on this link.

The material provided here has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Whilst it is not subject to any prohibition on dealing ahead of the dissemination of investment research we will not seek to take any advantage before providing it to our clients.

Pepperstone doesn’t represent that the material provided here is accurate, current or complete, and therefore shouldn’t be relied upon as such. The information, whether from a third party or not, isn’t to be considered as a recommendation; or an offer to buy or sell; or the solicitation of an offer to buy or sell any security, financial product or instrument; or to participate in any particular trading strategy. It does not take into account readers’ financial situation or investment objectives. We advise any readers of this content to seek their own advice. Without the approval of Pepperstone, reproduction or redistribution of this information isn’t permitted.