Why is spread trading one of the fastest growing form of trading? What are the benefits of spread trading? And what can South African retail investors gain from this innovative approach to trading? Here are the key benefits of spread trading:

You pay no stamp duty! How can this be? No duty to pay? Well it is true. Because when you spread trade a share you are taking up a position on that share with your spread trade company who is the market maker. You don't actually have to buy the share. Because you don't take ownership of that share you don't have to pay stamp duty on that transaction. This is one of the biggest benefits spread trading has over traditional stockbroking.	No commissions The spread you accept when you open a trade is your key cost. Spread trading companies also charge an overnight rolling fee based on open trades. These are the two costs you face - no commissions or other charges are levvied. The screen price at which you trade represents the total cost of the transaction. There are no futher commissions or extra charges.
Make money on rising AND falling markets Imagine only making money off rising markets? These days it can not be guaranteed that markets will keep rising yet we continue to trade shares in the traditional manner and lose money when the market pulls back. Traditionally it was only the institutions and hedge funds that could profit from falling markets. Spread Trading clients can now also benefit from falling markets by 'selling', also known as 'shorting' the market, giving them the opportunity to profit in volatile times	No currency risk on your Rand denominated account Spread trading is just starting up in South Africa. Unfortunately most forex trading companies and futures trading companies only allow you to operate your account in dollars. This is a bad thing should the rand start to lose ground to the dollar. The value of your account slips away!But, now that spread trading companies are starting to take a serious interest in South Africa they have started offering rand based accounts. No more currency risk!
Your trades are instant No more phoning your stockbroker. No more sitting around anxiously waiting for your share purchase to be executed in a market struggling for liquidity. Because you are not actually entering the market when you spread trade you get immediate execution of orders, either online or by telephone. Unlike traditional share dealing through a stockbroker there is no delay between placing an order to trade and execution of that order.	Spread betting is an extra weapon in your investment portfolio Hedging. You can protect a future payment or receipt due against any adverse currency fluctuations. A spread trading account will quote all of the major currency cross rates and can provide any other specific rates on request. You can also hedge the value of stocks held in foreign currencies in the same way.

Terms & Conditions of R1100 bonus offer

Please note: R1100 is indicative as it is the equivalent of £100 at time of publication. Capital Spreads will maintain their offer at £100 and the final value of the bonus will reflect the current exchange rate.

1. Your spread betting account at Capital Spreads must be funded with R2750 and 5 opening non-equity trades placed in order to qualify for the "Top-Up" offer. Once you've fulfilled these terms and informed the Capital Spreads Customer Support team, Capital Spreads will credit your account with R1100 within 72 hours.

2. This offer is valid for 30 days and in order to qualify for the "Top-Up" (bonus) the terms need to have been met by then.

3. This offer is only available to new London Capital Group account holders and is limited to one account per client.

4. This offer can not be used in conjunction with any other London Capital Group offer. Therefore, if you have claimed a different London Capital Group offer in the past, you are not eligible for this offer even if you have received the email.

5. Once you have fulfilled the criteria to qualify for the promotional offer please contact Customer Support team via email on This e-mail address is being protected from spambots. You need JavaScript enabled to view it to get the "Top-Up" applied.

6. The R1100 is for trading purposes and cannot be taken out of the account as cash for three months from the date credited to the account.

7. Capital Spreads will not be able to action a refund where the account balance is below the R1100 credit, even if you have credited your account after receiving the "Top-Up" offer credit.

8. In the event that you incur losses of greater than R1100, the R1100 deposited into your account may be used to offset your debt to us.

9. Capital Spreads will not be liable for any losses of more than R1100 that you may incur as a result of trading with the R1100.

10. This offer is subject to fair use policy and abuse of this offer may result in credit being withheld. Capital Spreads reserve the right to withdraw this promotion at any time.

12. The R1100 top up is credited to your account for trading purposes only. Capital Spreads reserve the right to revoke the credit if your account is not used for trading after the credit has been added.

Customer Support: +44 (0)20 7456 7020

Trading Line: +44 (0)20 7456 7010

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www.capitalspreads.com

The following reasons explain why spread trading might appeal to you:

Spread Trading vs Spread Betting

When getting involved in leveraged trading, you are likely to bump into the terms Spread Trading, and Spread Betting.

So, what is the difference?

There is actually absolutely no difference.

Spread Trading and Spread Betting are the same trading product, however in the UK it is referred to as Spread Betting and in South Africa it is referred to as Spread Trading for tax purposes.

Spread Trading profits are exempt from Stamp Duty in both the UK and South Africa. However the UK tax authorities only allow this if this form of trading is classed as 'betting' as betting is a tax free product in the UK. If the clasification were to change in the UK then stamp duties would apply depriving the industry of one of its key advantages over traditional share trading.

If we look at a typical scenario Spread Trade we can understand the risk as being simple.

In gambling the house always wins - simple.

Spread Trading for the private investor is in principle a simple affair.