If you wanted to buy 10,000 shares in a stock, that’s at 140p, you can do that with your stockbroker. So that’s a cash out there of 14,000 pounds, that’s your total investment. The equivalent of doing that with Capital Spreads in Spread betting is to buy 100 pounds per point. It works out that one pound per point on the UK share is the same as buying or selling 100 shares.
Now you notice that the price you pay with Capital Spreads, of course, is slightly higher. That’s because of our dealing spread. Now, using the max Computer Generated Stop Level, that’s 10 percent for UK 100 shares, that means that your total margin is 1,401 pounds. So already a huge difference in the amount of cash you actually have to put in your account. Let’s assume that the share price goes higher and we sell them at 200p, so again a small difference in the price for the Capital Spreads, the difference is of course with the costs.
