One of the key selling points of spread betting is that it opens the door to a variety of markets that have been unavailable to ‘at-home’ traders in the past. Some of the most popular markets to trade are called Indices. These are comprised from a number of companies in different countries, ranging from England and Germany to further a-field such as Japan and America. It is possible to enter into both rolling and futures contracts for these markets.
The FTSE 100 is a share index of the 100 most highly capitalised companies listed on the London Stock exchange. Due to copyright issues this will normally be referred to by the Spread betting companies as the UK 100. Lets say that the GDP figure was due to be released and you thought it would be better than expected, and in turn would have a positive impact on the index. The current quote was 6020-6022 and you bought at 6022. If the market did rise on the back of the news and you closed out at 6050 a 28 point profit would be secured.
Another popular index is the Dow Jones. This shows how the top 30 companies in America have traded during a standard session in the stock market. This will most likely be referred to as the Wall Street 30 or something similar for copyright reasons.
There are many factors that can have an affect on these markets, ranging from news on take-overs to the latest economic data. I think that because there is widespread coverage and news available it has become so popular with traders, as they can keep on top of the latest goings on. It’s also worth pointing out that a lot of people like to trade on Indices is due to their very volatile nature. Large swings can take place intra-day and overnight. It is not unheard of for the FTSE to move by over 100 points and the Dow by as much as 200-300.