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 As I write this, I'm nursing a small sore head and a clear wallet. In the last four weeks I've lost almost £30,000 spread betting for around one hour each day five days a week. So I managed to blow around £1,500 an hour. That's really quite a portion of cash. Actually, it's not exactly as bad as it looks. Fortunately, I was betting utilizing a few spread-betting companies' demo sites. They are simulations of the live betting sites that permit you to practice prior to starting betting with real money UFABET. I realise that I am no financial genius otherwise I would have been rich long ago. However, the truth that I managed to squander so much money so quickly does pose the question - if spread betting seems so easy, why do this lots of people get completely wiped out extremely quickly?

We're increasingly seeing advertising for spread betting in investing and money management publications. In usually the one I donate to, four or five different spread betting companies take full-page colour ads weekly, outnumbering any form of advertising. Spread betting ads already are common in the business sections of many weekend newspapers and will most likely soon start to look in the non-public finance sections. Spread betting could appear deceptively attractive to many savers. After all, profit a bank, shares or unit trusts will at best give us about an unhappy five per cent a year before tax. Yet an acceptable run using spread betting can certainly enable you to pocket ten per cent per week - five hundred per cent a year - completely and gloriously tax-free. So spread betting can enable you to earn in only twelve months what it'd take a hundred years or more to reach with many other investments.

Spread betters gamble on price movements of anything from individual shares, currencies and commodities to whole markets just like the FTSE, Dax or S&P. It is known as spread betting because the organization providing the service makes most of the money by putting an additional spread around the cost at which something will be bought or sold.

Spread betting appears to have many advantages compared to traditional investing:

• You don't have to get anything - It lets you bet on price movements without having to purchase the underlying assets - shares, commodities or foreign exchange.


• It's tax-free - Whenever you buy or sell shares, get paid dividends or receive interest from a bank you will have to pay taxes like stamp duty, capital gains and income tax. Unless spread betting is the full-time job and only supply of income, you will find no taxes to be paid as it's regarded as being gambling.


• You are able to go long or short - Whenever you spread bet you are able to gain just as much whether prices rise or fall, providing you with guess the direction correctly. With most other investments, you will need the cost to increase when you create a profit.


• You are able to bet on a rise or fall at exactly the same time - If the FTSE, like, is trading at 5551-5552, you are able to place two bets, one that it will rise and one that it will fall. These only get triggered once the FTSE actually moves. So when it starts going up, your bet that it will rise gets triggered. Similarly when it drops, only your bet that it will fall is triggered. So it could seem that, come rain or shine, you'll probably win.


• Huge leverage - In the event that you bet say £50 a pip (a pip is normally the minimum price movement you are able to bet on), you can easily win four or five times your original bet if the cost moves in the best direction. On a great bet, you are able to win much much more.


• You are able to wait for the breakout - Prices on many shares, currencies, commodities and other activities people bet on tend to see periods of stability followed closely by bursts of movement up or down, what spread-betters call 'the breakout' ;.You are able to place a bet that is only activated once the breakout comes.


• Loss limits - You are able to put conditions in your bet that prevent your losses exceeding your chosen level should your bet are actually wrong.


• You are able to adjust mid-flight - With most bets, such as for instance with horse racing or on roulette, when the race has started or the croupier has called 'you can forget bets' you have to wait helplessly for the result to see if you've won or not. With spread betting you are able to decide to close your bet at any time. So if you're ahead, you are able to take your winnings; if you're behind you are able to either cut your losses or wait in the hope that things will change and you'll be up again.

Given each one of these properties of spread betting, it ought to be pretty easy to make a fair little bit of money without an excessive amount of effort. If only.

Industry estimates declare that around ninety per cent of spread-betters lose most or all their money and close their accounts within 3 months of starting. There seem to be another eight per cent roughly who make reasonable levels of money on a typical basis and you will find around two per cent of spread-betters who make fortunes. I've been to a few presentations run by spread betting companies and at one of these brilliant the salesman let slip that over eighty per cent of his customers lost money. Even many professionals lose on about six bets out of each ten. But by controlling their losses and maximising their returns if they win, they can increase their wealth.

Why it could go horribly wrong

There seem to be several reasons why spread betting is so with the capacity of dramatically demolishing most practitioners' wealth:

• The firms want you to lose - When you open a demonstration or real account, you are certain to get several telephone calls from extremely friendly and helpful teenage boys and women at the spread-betting company asking if there's anything they can do to assist you to obtain going. This really is customer service at its very best. A lot of the people contacting you will parrot the line which they only want to help and that they're happy if you're successful as their company only makes money from the spread. Some will reassure you that they want you to win while the more you win, the more you're likely to bet and the more the spread-betting company will earn. This could make you are feeling good, convince you that the organization is open, honest, trustworthy and supportive and encourage you to utilize them for your betting. But it's also a lie. It's true that the organization may make a lot of its money from the spread. However, with many of one's bets, you're betting against the organization and so they hope you lose, big time. Actually, over the past month I've seen several companies change the conditions on the sites to create it more likely that people using them will lose. So, lesson one - spread betting companies are not your friends. The more you lose the more they win. It's that simple.


• It's difficult to break even - In the event that you bet say £50 a pip and the cost does go the way you want, the spread betting company takes the initial £50 you win. So the cost has to move two pips in the best direction for you yourself to win your £50 back and three pips for you yourself to emerge with £100, doubling your money. If the price moves three pips in the wrong direction, you lose your original bet plus £50 a pip, giving a complete loss in £200, a loss of four times your original bet.


• Losses could be massive - With most gambling, you are able to only lose that which you deposit on a horse, blackjack or roulette. With spread betting you are able to quickly leave behind far more than you wager. I forgot to put a stop loss on a single bet and managed to lose over £800 with just one £50 bet. Because your bet is leveraged, you may make both fabulous gains and excruciatingly painful losses. Too often it's the latter. The small size of many bets, often £5 or £10 a pip can lull betters in to a false sense of security. It's only once the losses go five to ten times the original bet which they realise the chance they have taken UFABET

"The spread betting leverage implies that you can get rich which really is a wonderfully appealing idea, but it addittionally means you can get poor which many people ignore."

• You are able to waste thousands on courses and systems - At one free spread-betting seminar I attended we were a lot more than strongly encouraged to sign up for a two-day weekend course teaching us just how to spread bet successfully. This might normally cost (we were told) £6,995, but there was a special offer for the initial five people to sign up of only £1,997. There are many such courses and also gurus offering to offer you their special spread-betting systems, guides, webinars and all sorts of other advice. With so many supposed experts apparently making a living teaching others just how to spread bet, there should be a lot of takers. But I've found that you need to know and more is available free on the Internet. As you specialist said, 'Don't bother wasting your cash on 'Guru' books written by so-called experts. Those books are crap and not worth the paper they are printed on. Nobody sells a key trading methodology if they are really successful. The sole reason these guys are writing books is basically because they didn't make it as traders' UFABET