I just want to know people's opinions about spread betting stocks cos as relative Newbie i have always spreadbet only indices. Is it really a good idea to SB stocks or one is better off using other instruments?
If your trading plan includes trading shares for capital gains over the medium term then spreadbetting is by far the best way to do it. No capital gains tax and, more importantly, no stamp duty. Also the leverage means that you can trade a meaningful amount of stock without putting up too much capital.
The disadvantages, however, are that you receive no dividends and any losses made cannot be offset against other capital gains.
Don't try and daytrade shares with spreadbetting though, you'll get mauled. In fact don't try and daytrade the UK market at all, the only place to do that successfully is the US via a direct access platform. The costs and spreads are far too high in the UK.
I've done a hell of a lot better spreadbetting the stocks than the indices... position trade them, that has been for me the best. I am finding it difficult to daytrade cos a) I'm crap and b) I work 9 to 5
sidinuk is right though... don't daytrade UK stocks or indices, you'll get mauled.. (like I have!!) haha
my problem with spreadbetting stocks is choosing the right ones to trade.........i am going to try using a system from the Champion Trader manual after paper trading them for awhile , it advocates trading only stocks in the DOW 30 and FTSE100 cos of their liquidity.
You said: "Also, you do get the dividends on stocks with spreadbetting."
How does that work then as it is news to me ? If you dont own the shares which with SB you dont how can you get dividends on them because all you are doing is betting on whether the stock rises or falls in value ?