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How To Spread Bet Shares And Potentially Profit In A Falling Market

LONDON, April 20, 2012 /PRNewswire/ --

Learn how to spread bet shares with this step-by-step guide - I'll explain not only how you can take a position on a market that's falling, but also provide you with a comprehensive overview of spread betting and how you can access over 12,000 financial markets for only a small initial deposit.

Spread Betting with City Index

Spread betting is a popular product for traders both new and experienced as it offers entry level access into the financial markets.

Spread betting with City Index enables traders to take positions on a range of markets for only a small initial deposit typically between 1% and 10% of an underlying market's value through a low margin feature.

The margin feature increases their market exposure and potentially magnifies profits.

Spread betting is also tax efficient; currently under UK tax laws, all profits made through a spread bet are free from UK Capital Gains tax* and Stamp Duty*, though this remains subject to change.

Profit from a falling market

Spread betting allows traders to go both long (buy) and short (sell) on trades - meaning those choosing to spread bet on shares can profit from a market which falls as well as rises.

However, as a leveraged product; should the market move against your position it can also result in losses greater than your initial deposit, making risk management tools, such as stop loss orders, imperative to a trading plan.

How to Spread Bet Shares

As mentioned above, spread betting offers traders the potential to profit from a market that falls by going short on a trade and selling.

For example purposes only, let's say we are looking to take a position on the future price movement of M&S shares.

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