Long term spread betting on the S&P 500. (i.e. investing). Has anybody tried this?

[advertscrap]

Has anybody here, or have you heard of anybody, long term "investing" using Spread Betting?

That is, DCA every month / week on the S&P 500. Using the futures / forwards so there is no overnight holding rate.

Seems like a great way to invest in the S&P with zero tax on profits.

Obviously, you would need a good bit of free cash in the account to protect from drawdowns. How much exactly is needed to avoid a wipe-out, I am not sure.

Anyway, I'm waiting for somebody to come along and tell me why this will end in disaster.

My only worry would be: Will my broker pay out or even be around when I want to cash out in 20 years?

 

[tomorton]

What would be the advantage over unique short-term positions? Especially when these could be short as readily as long?

Your final question highlights a serious risk.

The hidden questions are will financial spreadbetting still be legal in the UK, and will it still be tax-free?

 

[Riddler]

Seems like a great way to invest in the S&P with zero tax on profits.

You can achieve this by using an ISA too, that's how I do it, no margin calls or dormant capital propping up the account

 

[advertscrap]

You can achieve this by using an ISA too, that's how I do it, no margin calls or dormant capital propping up the account

I'm in Ireland. We don't have ISAs here, I wish we did. But we do have Spreadbetting and it's the same rules as UK.

 

[Riddler]

I'm in Ireland. We don't have ISAs here, I wish we did. But we do have Spreadbetting and it's the same rules as UK.

It is because you mentioned Spreadbetting that I mentioned the ISA, I had no idea that SB was available outside of the UK. In that case your proposal sounds more appealing and I can see why you would consider doing this and like you I'd only ever consider the US markets with that strategy since it is the most resiliant market although when it peaked in Dec 2021 it took 10 months to bottom out (circa -27.5%), the extra margin that would have been required during that time is good money that could have been better used to add to and grow the position so I'd probably favour paying the taxes in a GIA if I wanted to buy and hold. The tax situation might look unfavourable today but in 10/15/20 years time when you might want to cash in who knows what it will be?

What's the lowest amount of leverage you can use for this endeavour in your SB account?