This article aims to show the differences between spread betting and CFD trading. This information will help many traders identify which of the two markets they should be trading.
Spread Betting and CFD Trading
CFD trading and trading with CFD brokers is popular in Singapore
The Differences Between Spread Betting and CFD Trading
Differences in spread betting and CFD trading exist in the following metrics:
- Payable taxes
- Location of brokers
- Trading mechanics
- Market access and trade execution methodology.
These will now be explained in tabular form.
Do I need to be located in the UK to enjoy spread betting?
A large percentage of those who engage in spread betting is based in the United Kingdom and Ireland. However, this does not mean that those who live in Europe or Asia cannot open spread betting accounts. There are two issues that those trading from outside the UK/Ireland have to contend with. These are:
- a) The tax situations in the individual countries
- b) Brexit
Tax laws in the UK and Europe are not uniform and many countries do not have tax laws that allow exemptions from any trading activity, be it spread betting or CFD trading. Another even more concerning factor will be the impact of the impending Brexit. It is uncertain if European traders who engage in spread betting and CFD trading will still enjoy the same benefits that are available to UK/Ireland-based traders post-Brexit. But for now, these are the main differences between spread betting and CFD trading.
