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Trading News Spread Betting - The Risk Warning!
Trading News Spread Betting - The Risk Warning!
Spread Betting - The Risk Warning! |
| Written by Trader Hideout Editor | |||
| Tuesday, 26 May 2009 11:49 | |||
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Engaging in this kind of transaction is not without risk, and it is important to appreciate that spread betting transactions differ markedly from the usual betting transactions. Never enter into such transactions unless you fully understand the nature of the associated risks, and equally fully understand and appreciate the exposure to potential loss.Unlike traditional betting transactions whereupon the loss is restricted to a predetermined amount (i.e. the amount of the bet placed), the amount you could win and lose when spread betting will be very much dependent on the fluctuations in underlying markets or instruments on which the bet was placed. You should therefore carefully consider your financial and personal circumstances before entering into financial spread betting transactions. On a final point, just be aware that if you decide to deal on a credit basis with a particular spread betting company, the extent of your credit may not restrict your losses or financial liabilities. As a consequence, the amount of capital you are prepared to risk should always be sufficient to cover not only your credit allowance, but a further amount in case the underlying market moves do not work in your favour. In other words, do not consider risking more than you can afford to lose.
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