AvaTrade Spread Betting

Unlock the power of spread betting with AvaTrade

Total Score


Minimum Deposit




Payment Methods


Withdrawal Processing Time



AvaTrade has established itself as a pioneer in the financial industry. One of its most distinctive features is spread betting, an intriguing form of trading that provides traders with the opportunity to profit from both rising and falling market prices. In this comprehensive guide, we'll delve into everything you need to know about spread betting with AvaTrade.

Setting up an AvaTrade account is a quick process that only takes a few minutes, allowing you to start trading in no time.

What is Spread Betting?


Spread betting is a derivative strategy, where participants do not own the underlying asset they bet on, such as a stock or commodity. Instead, spread bettors speculate on whether the asset's price will rise or fall, where the degree of change is the main determinant of profit and loss.

Spread betting is also marked by its unique tax benefits. In certain jurisdictions, profits from spread betting do not attract capital gains tax. This tax-free nature of spread betting makes it a powerful tool in the hands of informed traders.

Spread Betting vs CFD: What's the Difference?

Spread Betting vs CFD

Both spread betting and contracts for difference (CFDs) are popular financial derivatives that allow traders to profit from price movements in underlying markets, such as forex, indices, commodities, and more. While they share similarities, there are fundamental differences between these two trading mechanisms that are essential to understand for every trader.

Spread Betting is a form of derivatives trading where traders speculate on the price movements of various financial markets. In this form of betting, you don't own the underlying asset; instead, you bet on whether the price of the asset will rise or fall.

Contracts for Difference (CFDs), on the other hand, are derivative products that enable traders to speculate on the rising and falling prices of fast-moving global financial markets (or instruments) such as shares, indices, commodities, currencies, and treasuries.

Key Differences between Spread Betting and CFDs

Ownership of the Underlying Asset: In both spread betting and CFD trading, you don't physically own the underlying asset. Instead, you're speculating on the price movements. However, with CFDs, you're trading a contract (the CFD), which mirrors the price and performance of the underlying asset, making it feel more like traditional trading.

Taxation: One of the main differences between spread betting and CFD trading lies in their tax implications. In certain regions, spread betting is considered a form of gambling, thus it's exempt from Capital Gains Tax (CGT) and Stamp Duty. CFDs, however, are not exempt from CGT. It's important to note that tax treatment depends on individual circumstances and can change or may differ in a jurisdiction other than the UK.

Profit and Loss Calculations: Profit and loss in spread betting are calculated based on the stake size multiplied by the amount the market moves in your favour or against you. For CFDs, profit and loss are calculated based on the number of contracts and the level of movement in the price of the asset.

Currency of Trading: Spread betting is typically conducted in your local currency per point movement. Conversely, CFDs are traded in the currency in which the underlying asset is denominated.

Trading Costs: Spread betting costs are included in the bet, so you are aware of all costs before the bet is placed. However, with CFDs, there may be various additional costs, such as commission fees, transaction fees, and overnight holding costs.

Choosing between Spread Betting and CFDs

Determining whether spread betting or CFDs are right for you depends on several factors, such as your risk tolerance, financial goals, and understanding of the markets.

Spread betting might be more suitable for those who prefer a straightforward approach, with profits and losses easily calculable, prefer their transactions to be in their local currency, or who might benefit from the tax implications.

On the other hand...

CFDs might appeal to those who prefer a trading experience that closely mirrors traditional trading, are trading in large volumes (where commission-based pricing could be advantageous), or want to hedge an existing portfolio, as CFD losses can be offset against profits for tax calculation.

How Does It Work?

Spread Betting via AvaTrade

AvaTrade offers a robust platform for spread betting. Their innovative model is designed to cater to both novices and experienced traders. It revolves around a bid-ask spread, which is the difference between the price at which you can buy an asset and the price at which you can sell it.

When spread betting, you place a bet per unit of movement in the particular asset's price. If you believe the asset's price will rise, you 'go long' or buy. If you predict the price will fall, you 'go short' or sell.

Let's use a simple illustration to comprehend this better. Suppose AvaTrade quotes a bid and ask price for a particular asset, say, a stock priced at £100 and £102 respectively. If you believe that the stock price will rise, you may 'go long' at the asking price of £102. If the stock price ascends to £105, you will gain £3 for every point that you have bet. If the stock price drops to £98, you will lose £4 for each point bet. Conversely, if you decided to 'go short' at the bid price of £100 and the price drops to £97, you gain £3 for each point bet. However, if the price rises to £103, you lose £3 for each point bet.

Why AvaTrade?

Why Choose AvaTrade?

There are several reasons why AvaTrade stands out as an ideal platform for spread betting.

Regulation and Trust: AvaTrade is a regulated broker across five continents, providing users with peace of mind. It adheres to the strictest of standards, ensuring safety and security for traders.

Intuitive Trading Platforms: AvaTrade provides cutting-edge platforms that are user-friendly, reliable, and packed with tools for in-depth market analysis. This allows you to make informed decisions and get the most out of your spread betting experience.

Comprehensive Education and Support: AvaTrade is dedicated to empowering its traders. They offer comprehensive educational resources that help traders understand the markets and the nuances of spread betting. Their dedicated customer support is always ready to assist you, addressing any questions or concerns that may arise.

Competitive Spreads: AvaTrade is known for its competitive spreads that allow you to maximize your potential profits. The spreads can be as low as 0.8 pips, which is highly advantageous for spread bettors.

Advanced Risk Management Tools: Spread betting is exciting but can be risky. AvaTrade equips its users with advanced risk management tools to control potential losses. This includes features like Stop Loss, Take Profit, and entry orders.

Can All Traders Spread Bet?

Supported Countries

Please be aware that AvaTrade exclusively offers spread betting to its clients residing in Ireland and the UK only. This financial strategy is particularly appealing to traders due to its notable tax benefits. Unlike other financial market investments, the profits derived from spread betting are exempt from capital gains tax and stamp duty, thus presenting an attractive incentive for investors.

Why Spread Bet on MetaTrader?

MT4/MT5 Spread Betting

Spread betting is readily accessible across a diverse array of financial instruments via the globally renowned MetaTrader4 (MT4) and MetaTrader5 (MT5) trading platforms, which AvaTrade offers. This award-winning platform enables you to reap the benefits of tax-free profits, swift trade execution, robust analytical tools, live dynamic trading charts, and competitive spreads.

AvaTrade MT4 platform
AvaTrade MT4 platform

Furthermore, MetaTrader boasts an expansive portfolio of financial instruments. You have the flexibility to select from over 200 assets encompassing forex, stocks, indices, commodities, and ETFs. A unique feature of MT4 and MT5 is the Guardian Angel risk management tool, which provides customized feedback on your trading performance to enhance your investment strategies.

How to Spread Bet with AvaTrade?

How to Get Started?

The process of beginning your spread betting journey with AvaTrade is straightforward and convenient. You need to follow these basic steps:

  1. Open a Spread Betting Account: First, you need to open a spread betting account with AvaTrade. This is a simple process that can be completed online. You will be required to provide some basic personal information and comply with certain identification protocols.

    Opening an AvaTrade spread betting account
    Opening an AvaTrade spread betting account
  2. Fund Your Account: Once your account is opened and verified, you can fund it using various deposit methods, including credit cards, wire transfers, and e-wallets. AvaTrade assures quick and secure transactions, enabling you to start trading swiftly.

    AvaTrade deposit via credit card
    AvaTrade deposit via credit card
  3. Get Acquainted with the Trading Platform: Familiarize yourself with the trading platform. AvaTrade provides several platforms, including the popular MetaTrader 4 and 5, which both can be customized to suit your trading preferences.

    AvaTrade MT4 platform
    AvaTrade MT4 platform
  4. Start Spread Betting: Once you're set up, you can start spread betting. Monitor market trends, study price movements, and make informed decisions. Remember, the more knowledge you have, the better your chances of succeeding in spread betting.

How to Improve Spreads Betting Skills?

Enhancing Your Skills

AvaTrade believes in empowering its traders with knowledge. Hence, they provide a range of resources to enhance your understanding and skills in spread betting.

  1. Educational Resources: AvaTrade has an extensive library of educational resources. This includes detailed articles, eBooks, video tutorials, webinars, and more, covering various aspects of spread betting.

    AvaTrade Academy page
    AvaTrade Academy page
  2. Demo Account: AvaTrade offers a demo account feature. This enables you to practice spread betting without any financial risk, using virtual funds. It is a great way to familiarize yourself with the mechanics of spread betting and the trading platform.

    AvaTrade MT4 demo account
    AvaTrade MT4 demo account
  3. Market Analysis Tools: Use AvaTrade's advanced market analysis tools to study market trends, analyze price movements, and gain in-depth insights. These tools are essential for making informed spread betting decisions.

Spread betting with AvaTrade offers a plethora of opportunities. It is a thrilling way to speculate on various financial markets. AvaTrade, with its state-of-the-art trading platform, extensive educational resources, and committed customer support, provides a conducive environment for spread betting.

Remember: While spread betting can lead to significant profits, it also comes with potential risks. Hence, it is crucial to understand the concept thoroughly and use risk management tools effectively. Take advantage of AvaTrade's resources and start your spread betting journey today!

Armed with comprehensive knowledge about spread betting, you're now ready to embark on your journey!