Original Question: Hi, I’m looking to Spread Bet as a day trader on the NASDAQ and NYSE. I’m looking for a platform that offers free guaranteed stop losses, access to small cap tech and pharma with excellent analytics and small spreads. Any ideas?
Spreadex is the short answer, but for the longer version please read on.
The field for spread betting brokers is narrowing considerably. Every day there are CFD and forex brokers setting up. But spread betting seems to have fallen out of fashion.
I don’t know why. It’s one of the simplest forms of trading and the profits are free from capital gains tax. So the bad news is that there are fewer spread betting brokers to choose from. The good news, however, is that whilst there are fewer the small group of companies that cater to clients who wish to spread bet on the financial markets are actually getting better all the time.
As welcome bonuses have been banned and firms have to cap leverage spread betting brokers are focussing more on personal services, added value, market access, and innovation.
Here we’ll breakdown the sections you are looking for:
Spread betting on NASDAQ and NYSE:
Pretty much all spread betting brokers offer spread betting on the US tech, NASDAQ & NYSE markets including:
You should also be able to deal after hours with these brokers. The NASDAQ and NYSE indices obviously run 24 hours, but you can also buy and sell NASDAQ and NYSE stocks after the market has closed and before the open.
Spread betting brokers that offer free guaranteed stop losses
I’m afraid that brokers don’t really offer free stop losses. You will always have to pay a premium for this feature because the broker is putting itself at risk by offering it.
However, you may find that some brokers only charge you if your guaranteed stop loss is triggered.
You may find this article on guaranteed stop losses useful: Guaranteed stop losses: What are they and which CFD and spread betting brokers offer them?
Again, all these brokers offer guaranteed stop losses.
Although there are limits on products, trade size and levels for each one.
Spread betting brokers for small-cap and pharma.
This makes narrowing the brokers down a little bit easier. CMC Markets tends to focus more on providing tight pricing on the more liquid, and therefore high cap stocks. IG & City Index will also offer online and phone trading on AIM stocks.
However, if you looking for a broker that offers all of the above as well as access to small-cap and high-risk pharma shares then Spreadex is probably the broker for you.
They are smaller than IG & CMC but offer a good dealing service. They also make a point of providing access to smaller Aim stocks. We did actually cover this a while ago here: Best way to spread bet on the AIM market.
As well as offering online access to the AIM market, Spreadex will work orders inside the Bid/Ask for you if you ask nicely over the phone. This is a considerable advantage as illiquid AIM stocks usually have wide spreads in the underlying market.
It will be interesting to see how the AIM market develops as people seem to be falling out of love with smaller-cap listed companies. If you are interested in the AIM market I can suggest reading our interview with Justin Urquart Stewart, one of the original founders of the AIM market.
Analytics and added value from spread betting brokers
City Index is generally pretty poor for analytics, CMC Markets offers some good sentiment tools that show what their client base is buying and selling. One good feature is that you can narrow it down to profitable clients. IG, offers fantastic research tools, sentiment, and market commentary. Spreadex, have some really good technical analysis tools on its site. However, technical analysis can use useful in liquid markets, although not so helpful in value-driven small-cap stocks.
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Richard founded the Good Money Guide (previously Good Broker Guide) in 2015 and has been a broker for 20 years most recently at Investors Intelligence and previously a multi-asset derivatives broker at MF Global (Man Financial). Richard started his career working as a private client stockbroker at Walker Crips and Phillip Securities (now King and Shaxson) after interning on the NYMEX oil trading floor in New York and London IPE in 2001 & 2000.