T2W Trading Community

London Metal Exchange

The LME contracts for none-ferrous metals such as

ALUMINIUM ALLOY
ALUMINIUM
COPPER
LEAD
NICKEL
TIN
ZINC
NASAAC

They run from 90 consecutive days and not 3-month contracts to which we have become accustomed. This can cause confusion. As when you open a 90-day LME contract then a week later you decided to close by either buying or selling a 90-day contract - you would be opening a new contract and not selling/buying the old one to close.

That is why when trading the LME markets you makes a note of the contract date to which you are closing. When you go to close that contract you chose the contract date for which you are closing and not buying/selling to close on a new 90 day contract.

Sounds difficult, but only a handful of the professional league financial spread betting firms trade using the LME as a guide.
Most people that hear of financial spread betting don't realise, for various reasons, quite how easy and profitable it can be, but also the variety of differing products to which you can trade within. One such product that is gaining more and more popularity is trading in UK House Prices.

You can get the best data from the horse’s mouth, direct from the LME: http://www.lme.co.uk/dataprices_daily.asp

UK House Prices

As far as I am currently aware you can only trade on the housing market within the UK. It doesn't matter where about you live, you just have to realise that the property values quoted are based on UK Property values. I am sure as international popularity of financial spread betting grows further housing markets from around the globe will arise, along with additional products for us all to make money from.

So how do you make money from the UK Housing Market?

Well I feel a need to clarify a few points before we go into some details of the housing market and as ever it isn't difficult. I just want to make sure we are clear on a few things:

• We are not buying any property
• We do not own or share any ownership in any property
• The contracts are identical to other financial spread betting contracts
• There's no red tape, expenses or delays
• No Stamp Duty (UK Government Tax on property)
• No Capital Gains Tax (UK Government Tax on windfall profits)
• No need to put up the full value

As you can see, once again we don't own anything, there are no liabilities or tax obligations, as there would be if we were actually buying and selling property to make profit.

The only liability we have is that of our contract with the Financial Broker whom we have opened the trade with. financial spread betting on UK Property prices as we have seen lets you avoid many of the financial and tax implications often associated with investing in the property market. financial spread betting on property prices may seem at first somewhat odd, but it lets you gain a great deal of exposure to a market without purchasing or obligating yourself to any property related contract.

The trade prices quoted on most house prices with financial bookmakers are usually based on the Standardised Average Price as reported by the HBOS from the UK lender Halifax, who issue their own survey called the Halifax House Price Survey. Therefore, the prices you are quoted are not inflated or guessing.

You therefore have an opportunity to profit from price movements within these markets, or indeed if you live within the UK, you can even 'hedge' against your own property* so you can reduce possible losses in the value of your property by clever use of 'hedge' betting.

 (*The value isn't based on your actual property value. You select the average property value based on the above average SAP (Standardised Average Price in either your own UK county/district or that of another UK county/district).

Trading on house prices can either be traded as price quoted based on the SAP average of the whole of the UK, or that of a selection of key regions within the UK. Not all regions are quoted by every Financial Broker. Please check with your Financial Broker before trading in UK Property Prices.)

Both the national house prices and regional house prices are measured against the seasonally adjusted Standardised Average House Price which is published monthly, regional house prices tend be based on the SAP for regions which are published quarterly. You can find further information regarding the average house prices and the SAP prices by visiting the following URL: www.hbosplc.com

The actual type of trade that you can open varies. It is best to check with your selected financial broker, prior to trading in this market.

Let’s look at a trade to see how house price movements are reflected in financial spread betting:

Let’s say that the average HBOS figures out claim that the UK average house price is £140,500. The prices quoted by a financial broker are formatted as follows:

Average House Price: £140,500 = Quote 140.5
This maybe quoted as the following trade & spread
139.5/141.5

We decide to trade LONG at 141.5 @ £100 per point. The value of property reaches £143,500 we therefore close at 143.5 resulting in a profit of £200

We can of course trade SHORT if we believed that the national/regional property prices will fall.