If there’s one thing the internet does really well it’s vice. It’s a privacy thing, it’s an ease of access thing but most of all it’s a mass market thing. Stuff like exchange betting simply wouldn’t be possible in a traditional bookies. And the internet blurs boundaries. It’s always been true that investments can go down as well as up – that investing is gambling – but it seems that financial spread betting has taken that to a new level; good honest betting regulated by the FSA who’ve come down hard on those who don’t make the risks clear. But that hasn’t stopped get rich quick stories or the FT making it sound so simple.

Financial, or index spread betting, is focussed on share movements so it feels more legit. Some IFAs offer spread betting, making financial advisors bookies. Capital Spreads even suggest using it as hedging tool to protect a share portfolio. Add to that, tax free profits at time of writing, the absence of fees and the ability to bet shares will go down rather than up and it’s very enticing. Yet other benefits can turn into trouble. You need only deposit a fraction of a trade, but can lose much more than that stake. Capital Spreads cuts the risk by applying a stop-loss to each bet, but markets work in a way that means stop-losses cannot be guaranteed and punters can get burnt.

Those who don’t follow the markets can bet in the same way, with the same risks, on the sport of their choice. Betting on markets is fast becoming an acceptable way to manage your personal finances, but I guess betting on horses, football or snooker will never be. Maybe sport really is less predictable. Yet if you know more about those things, perhaps that’s where you should be. Sporting Index don’t just offer sports, but do specials like election results. Spread betting makes a flutter on the general election more interesting as it’s no longer a two horse race, but a prediction of seats won by the party of the punter’s choice.

The risks are real, but that’s the usual price of an investment with the potential to make substantial profit. Both Capital Spreads and Sporting Index offer free demo accounts and Sporting Index is the first spread betting outfit to offer free introductory bets. So play around for a while and gain some confidence before spread betting your shirt.
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