Visaria, quick question - when you say spread betting has zero taxes on winnings, how is that? I think spread betting is, for example, buying one long-term contract and selling several shorter-term contracts over time. If those positions ultimately expire in a manner in which you've made money, won't tax be do on the winnings? E.G. you lose $10 on the long contract, but you make $15 on the short contracts, so you would owe tax on the $5 difference? Thanks!
spreadbetting is not trading spreads. I think the word 'spread' in spreadbetting confuses 'proper' traders lol Think of it like regular futures trading, except that you are trading madeup numbers that just so happen to move exactly the same as the real market. It is considered gambling in UK law, thus tax free. Interesting that it's considered gambling when you think about how it's exactly the same as trading futures, in practice!
Nah, i have no idea what u are talking about re short term/long term contracts. It's basically the same as a brokerage account but with no commissions but the bid offer spread is wider to reflect that. For instance the spread on YM is 1 point, with the spreadbet firm it's 5 points. Certain spreadbet firms offer a day trading YM where the spread is 1 point or even less. If you hold a trade overnight on these, they will charge interest.
It's mainly a Europe thing from what I gather. I don't even think US citizens are allowed to open spreadbet accounts Pretty sure my dad couldn't even trade his account when he was on holiday in America a good few years back due to the IP address although that was back in the day and don't think they'd be that strict nowadays as i'm pretty sure he was able to trade when he went to Canada last year!!
Ah, I see. Yea, I remember reading about these awhile back, and being disappointed it was not a U.S. thing. I know in the U.S. any gains from these would be taxed. Thanks Brian and Visaria!