Man Group to Launch Spread Betting Service Later in 2004
27/04/2004
Man Financial, the brokerage division of the FTSE 100 hedge fund and investment specialist, is to launch a betting service later this year.
"We are planning to launch a spread trading unit in financial products such as stock indices and individual stocks," said Kevin Davis, managing director of Man Financial and a main board director of Man Group.
"This will provide our private clients with efficient, tax structured access to financial derivatives."
Spread bets are currently exempt from British capital gains and income tax. Often, there is little to differentiate them in terms of pricing from other derivative products and they have been adopted increasingly by many active traders over the past few years.
It is believed that spread betting veterans David Morrison and Stuart Lane, previously at Finspreads, will be responsible for the new venture, which is expected to be launched by September at the latest.
Budget bookies pipped at the lip.(City)
03/20/2004
THE bookies were enjoying a sparkling Cheltenham until Best Mate won the Gold on Thursday, so it was left to Gordon to take some money from them.
The Chancellor may have said that he will review the tax treatment of betting exchanges, but he gave the bookies a bigger beating by failing to take a few more pauses for breath.
"We were 45 seconds away from cleaning up," moans Ed Pownall, spokesman for financial bookmakers Blue Square. The firm had given odds of 2-1 on Gordon's lecture lasting between 55 and 60 minutes. On the day, Gordon was timed at 54 minutes and 15 seconds, and Blue Square lost pounds 85,000.
Financial spread-betting specialists Cantor Index also made a blunder. They gave a spread of 74-77 on how many times Brown would say the word "tax" in his oration. The rules were very strict - "taxes" and "taxation" did not count - but the Chancellor was miserly, mentioning the T-word just 34 times. "We took a bloody nose," says spokesman David Buik, although he is coy about how much Cantor lost on the bet. "A few thousand is all I ever say," he tells me.
Still, the bookies covered at least some of their losses. Blue Square made up pounds 65,000 from unlucky punters. And how much did Cantor lose on the day? You guessed it. "A few thousand."
Don't be taxed
03/23/2004
The FTSE has finally succumbed. It has slumped through its trend change point (4373), turning its swing chart down. A move down to a minimum of 4275 is now indicated. All the main indices have now fallen into line. However any sell-off in the US below 10000 in the Dow will put it into (mildly) oversold territory, so the FTSE slump may be only briefly endured. Whilst I am waiting for this correction to unwind, I take another look at spread-betting.
I praised spread-betting firms a fortnight ago. I think it only fair also to mention their principal disadvantage- the width of their spreads. The spread between bid and offer in the FTSE futures market on LIFFE is 1.5-2.5 points. A futures broker will charge you commission which might be the equivalent of 1.5 FTSE points. All in all there is no reason for spread-betting firms to make a spread any wider than four points on the FTSE futures during market hours (they are entitled to make wide spreads after the markets are closed because they are essentially doing speculators a favour). Yet many spread-betting firms make a spread in the June FTSE futures of eight points or in some cases as much as ten points. Beware that the lure of tax free profits has not blinded you to the fact that a spread in excess of four points is a tax. You are simply transferring your tax burden from the Inland Revenue to the spread-betting firms. And the pernicious aspect of this tax is that you don't pay it only on profits. You also pay it on losses.
Take for example a punter who works out a model to trade the FTSE making 40 points per winning trade (before taking account of the spread). Assume a stop-loss of 25 points. Assume a win/loss ratio of 11-9. The punter's model makes a net 225 points. But on a 10 point spread, he has paid six points of tax on all 20 trades, a tax rate of 53 per cent. A model with a profit target of 60 points, a stop loss of 35 points and an eight point spread (and therefore a four point tax) would still exact a tax rate of 23 per cent.
If you are a punter who is just learning the ropes and speculating in a smaller size than a single futures contract i.e less than £10/point in the FTSE, you have no choice but to pay the spread. Tuition costs money. And if you are a big punter, some of the spread-betting firms will quote you special narrow spreads. But the majority of punters are paying too wide a spread. Shop around for narrow spreads.
Alternatively, trading futures on LIFFE is not very heavily taxed. First, profits on CFD trading and LIFFE futures are generally counted as part of your capital gains. So first you use up your £8,100 capital gains tax allowance. Then you trade behind a small company, as I do. If your profits are under £10,000 it is tax-free (although the dividend window has now been closed). Profits between £10,000 and £50,000 are taxed at a graduated rate rising up to 19 per cent and profits between £50,000 and £300,000 are taxed at 19 per cent. There is also an exit tax eventually.
I like spread-betting but I wouldn't do it if they didn't offer me narrow spreads.
Money: It takes a cool hand to play at spread betting; If you can afford to lose, you might just win at this high-risk trading game, says Simon Hildrey.(Business)
03/14/2004 Byline: Simon Hildrey
Although investing in the stock market might feel like a gamble at times, fund managers argue it is far more scientific than that. But when it comes to spread betting, few in the industry would disagree that clients are doing little more than taking a punt.
Although many people avoid spread betting for that reason, it is one of the few investments to have benefited from the three-year bear market. The ability to gamble on a variety of things, from whether the value of a share or index will rise or fall to how many goals your football team will score, has attracted an estimated 100,000 UK investors.
Spread betting is similar to placing any bet, but with a difference. With ordinary betting, you're either right (your horse wins) and you win money, or you're wrong and you lose your bet. With spread betting, the more right you are, the more you can win. But the more wrong you are, the more you can lose beyond your stake.
One of the main attractions of spread betting, explains Simon Brown, strategy director of easy2spreadbet, is that you don't have to pay capital gains tax or stamp duty on your winnings. This is because you are not actually buying shares, indices or commodities. As trading of shares is subject to 0.5 per cent stamp duty, this can lead to significant savings.
Spread betting carries no brokerage fees, dealing costs or commission, either. However, you can't offset losses against gains you have made on other investments. And unlike a share holding, a spread bet does not benefit from dividends.
Given that spread betting is a risky business, you must approach it carefully. If you bet that a share price will fall, you take a "short position"; if it actually rises, your losses will be unlimited if you don't pay for a "guaranteed stop loss point". This puts a cap on the amount you are prepared to lose: for example, if you short company X at pounds 1.40, you can pay for your position to be closed at pounds 1.50.
Spread betting on the movement of a company's share price is the most popular form of trading. You take a punt on the movement over a pre-determined period, which can be daily, three months or six months. The shorter the time period, the narrower the spread.
Angus Campbell, head of sales and marketing of Finspreads, another spread betting firm, says that many investors prefer to trade on a quarterly view, betting on what the company's share price will be at the end of the next quarter in March, June, September or December. You can hold the bet until maturity or exit early if you make a gain, and can also roll over the bet from one contract period to the next.
In spread betting, your stake is placed on the movement of each point of what you are betting on. "What a point represents varies between asset classes," explains Mr Brown at easy2spreadbet. "For a share in a company, a point equates to a penny. If company Y is priced at pounds 1.40 and you bet pounds 10 per point and it rises to pounds 1.45, you gain pounds 50."
The minimum stake is often 50p or pounds 1 a point, but some spread betting firms allow investors to bet 1p a point for the first eight weeks to enable them to learn how the system works.
One of the risks of spread betting, warns easy2spreadbet's Mr Brown, is that you are betting on geared, or "borrowed", trades. This is known as trading on margin.
"A deposit of pounds 100 will give you exposure to the equivalent of pounds 1,000 worth of shares, as you typically only need to pay a 10 per cent deposit," he says. "But this carries a high degree of risk. You should trade only what you can afford to lose."
Mr Campbell explains: "All firms have a margin requirement - the deposit we need to cover any adverse movement in the position you hold. These differ depending on the volatility and liquidity of the stock: for FTSE 100 stocks it is 10 per cent, rising to 20 per cent for other indices."
Many people place spread bets because of the access this provides to investments it is normally difficult to buy - such as the movement in house prices and interest rates, and currencies and commodities. Clients have the ability to trade in shares listed in other countries without the currency risk.
If you decide to take the plunge, it is vital to make sure you are happy with the level of risk involved, and monitor the market constantly. "You must be prepared to lose money," says Patrick Connelly, research and investment manager at independent financial adviser John Scott & Partners. He adds that clients who like to punt on shares may use a small part of their savings to spread bet. But he stresses: "This has to be separate from their financial planning."
Spread betting service
03/12/2004
Online spread-betting service Easy2spreadbet.com (Easy2spreadbet appears like a sister site to finspreads) has launched a Traders Club offering investors a wide range of resources, tools, free seminars and workshops, as well as support from professional investors. Membership is free to anyone who opens an Easy2spreadbet account and trades at least once a month.
The ascent of Man in betting game.(City)
02/18/2004
TWO years ago Man Group had a chance to buy City bookie Financial Spreads, but passed it up, and the company was eventually bought by IFX for just under pounds 9m. At the time the hedge fund group claimed it wasn't a betting Man and didn't want to get involved in that dreadful gambling business. That was then. Now it has decided to back the other horse and is setting up its own financial spread betting division.
Man's doing this from scratch, but surely it would have been a shrewder punt to put pounds 9m on the proven runner? Nobody can tell me if I'm right or how much the group is investing in the new project, but Man has hired former Financial Spreads senior trader David "Jim" Morrison and I wonder if his former boss Stuart Lane, who quit as a Financial Spreads director last year, will remain on gardening leave for long? I wouldn't bet on it.
Deal4free.com reduces foreign exchange spreads on spread betting service
02/10/2004
Deal4free.com, a leading online Financial Spread Betting, Foreign Exchange and CFD provider, has created another wave in the Financial Spread Betting market by introducing FX spreads comparable to those offered by major banks.
With no commission charges, no Stamp Duty and no Capital Gains Tax* to pay on profits, a growing number of traders are choosing Spread Betting to trade the currency markets over more traditional products such as OTC Spot FX.
Roger Hynes, COO of deal4free.com, comments:
"Most FX traders are ex-professionals who have a wealth of trading knowledge, and because our spreads are as competitive as those offered by the major banks, Spread Betting has become the product of choice for even the most experienced Foreign Exchange traders. We`ve found that a number of UK clients who traditionally traded Foreign Exchange with OTC Margined FX desks, are now Spread Betting because of the tax exemptions."
The FX markets have recently been subject to large movements due to the weakening dollar, with a growing number of traders taking advantage of opportunities particularly in Cable and Euro Dollar instruments. With Cable now offered at a 4 point spread, and Euro Dollar at 3 points, Spread Betting is capturing the imaginations of many traders who may previously have judged it as an inferior product.
Roger Hynes adds:
"The Spread Betting product is offered across an institutional level trading platform with free FX analysis from IDEAglobal. Traders are granted fast execution on a wide range of instruments with a variety of order types. CMC Group started life as a Foreign Exchange market maker and transacted the world` s first online FX trade. We`ve transferred this experience across to our Spread Betting product, making it a cost effective, transparent and professional way to trade the markets. Our Daily Rolling Cash bet means that clients can trade on the Spot price of an instrument as well as the more traditional futures price normally associated with Spread Betting."
deal4free.com offers major currencies 24 hours a day, and an extensive range of cross currency combinations with highly competitive spreads. A full list of Spread Betting instruments and associated spreads can be found at www.deal4free.com.
About Spread Betting at deal4free.com
deal4free.com is one of the UK`s leading Financial Spread Betting providers and has recently been voted Best Spread Betting service and Best Online Trading Platform by the readers of Shares Magazine. Spread Betting is a tax-free alternative to traditional Share and FX trading allowing clients to potentially profit from both bull and bear markets. deal4free.com`s commitment to offering the tightest spreads in the market and their introduction of the Daily Rolling Cash bet has changed the face of Financial Spread Betting. There are presently over 1,000 products available to trade across deal4free`s award winning trading platform, making it one of the most comprehensive ranges of investments available to the retail investor online.
For further details, please visit www.deal4free.com or call 08000 933 633.
About CFD trading at deal4free.com
deal4free.com was the UK`s first commission free CFD provider, and the first company to introduce CFDs online to the retail investor. With over 1000 global products available to trade across their award winning platform, deal4free.com offers one of the broadest ranges of instruments available to the retail investor online. CFDs offer investors the opportunity to potentially profit from both bull and bear markets and under current legislation, are exempt from stamp duty.* CFDs are a margin traded product and deal4free.com offers some of the most competitive margins in the market with indices as low as 1% and equities as low as 5%.
For further details, please visit www.deal4free.com or call 08000 933 633.
About CMC Group
CMC Group transacts over $1bn per day and over 500,000 trades a month across its Financial Spread Betting, CFD and FX desks. With offices in London, New York and Sydney CMC has clients in over 100 countries. deal4free.com is the trading name of CMC Group comprising CMC Group Plc and CMC Spreadbet Plc.
The company was founded in 1989 and is authorised and regulated by the Financial Services Authority and is a Member of both the NFA in the United States and ASIC in Australia.
Investing in Derivatives carries a high degree of risk to the investor, which may result in the investor not getting back the amount of his original investment, and therefore are only suitable for those who have the required experience and understand the market risks.
IFX GROUP (IXF)
12/05/2003
IFX loves volatility. Sharp swings in the currency and equity markets - whether upwards or downwards - encourage IFX's customers to take positions. So, while the dollar has looked to be on the precipice several times lately, the fact that it hasn't yet taken the widely expected dive has resulted in a distinct lack of business activity for the company.
But where IFX has experienced a great deal of recent turbulence is just where it wants it least - in its own boardroom. Internal squabbling resulted in the departure of several senior directors. New chief executive Edmond Warner is now trying to get things back on track, with the help of a much leaner management team. Since his appointment, Mr Warner says that about GBP1m of costs have been cut.
And early indications suggest that the turnaround effort is bearing fruit. Around 500 new customers have signed up for IFX's newly-improved financial spread betting service in November, compared with an average monthly figure of 300. As well as attracting more new clients to existing operations, other options for growing the business include acquiring smaller rivals or taking on joint-ventures. And IFX's strong balance sheet means that there should be scope to do so.
House broker Panmure expects full-year adjusted EPS of 5.8p.
Sporting Index debuts Bet on the move - the World's first real-time mainstream mobile betting service; Gambling leader partners with mfuse to offer real time spread betting
12/03/2003
Sporting Index debuts Bet on the move - the World's first real-time mainstream mobile betting service; Gambling leader partners with mfuse to offer real time spread betting(C)1994-2003 M2 COMMUNICATIONS LTD
RDATE:12032003
Sporting Index, World leader in sports spread betting, today announced its move into the mobile market with the launch of Bet on the move, the first mainstream mobile online spread betting service in the World. Sporting Index has partnered with mfuse, a mobile technology company, to offer the service to anyone in the UK with a colour Java enabled phone. mfuse's technology will allow Sporting Index to offer consumers secure, real time spread betting and sports price updates direct to their mobile phone with an easy to use interface. With online betting worth more than $3.5bn annually worldwide, Sporting Index is confident that mobile will be a key growth area for spread betting.
Unlike competing offerings that rely on consumers owning PDA's such as the XDA, the mfuse-powered Bet on the move works with most Java enabled handsets, including Vodafone live's Sharp GX10i, the Nokia 7210 and soon the Sony Ericsson T610. Sporting Index has also made the product accessible by making it affordable - consumers only pay for the data traffic they use.
With millions of Java-enabled handsets in use, Bet on the move has the greatest reach of any current mobile betting system.
Sporting Index chose mfuse as a partner to create a mobile spread betting service because of its fast, proven, secure and easy to use application architecture. As mfuse builds its solutions by using open industry standards such as Java it can offer applications to a massive and growing pool of handset users from the start.
Wally Pyrah of Sporting Index, said: "We pride ourselves on being innovators in the field of sports spread betting. Following our success online we wanted sports fans to have the fun of spread betting in their pocket. While some out there have offered products that only a select few can use, our service offers mobile spread betting to anyone with a colour Java phone - and it's affordable because people only pay the standard cost for accessing the Internet through their mobile. mfuse are real innovators and their technology is invaluable to the Bet on the move service."
Charles Palmer, Co-founder of mfuse, added: "Spread betting is the ultimate mobile application to prove our technology on. It requires robust security, real time functionality and an intuitive easy to use interface, with the ability to function seamlessly across a vast range of phones."
A quick explanation of spread betting Spread betting is an easy way of placing bets on a whole host of markets.
Take a look at the example below.
Sporting Index might predict that Manchester United will get 79-80 points in the Premiership. If the punter thinks that we are being optimistic they would go LOW and 'sell' at 79. If they think Manchester United will get more than 80 points they would go HIGH and 'buy' at 80. In this example Manchester United end the season with 85 points. The punter that went HIGH would win five times their stake (85 minus 80 = 5). The punter that went LOW would lose six times their stake (85 minus 79 = 6).
About Sporting Index
From its founding in April 1992 Sporting Index has been a pioneer in the sports spread betting arena. With over 70% of the current market Sporting Index is the World leader in the field.
In July 2001, Sporting Index launched SportingIndex.com, the first truly live interactive online sports spread betting service.
BetHiLo was launched in January 2003 to offer sports fans small-stake spread betting with limited risk. BetHiLo retains all the excitement and functionality that makes spread betting so compelling but allows new users to limit their potential losses before an event. BetHiLo helps Sporting Index to achieve its goal of providing spread betting to all sports enthusiasts whenever and wherever they want it.
About mfuse
mfuse is a privately held company founded by Marcus Wareham and Charles Palmer in February 2002. Their mission is to create cost-effective, cross-platform mobile solutions for a wide variety of market sectors, ranging from betting companies and broadcasters to financial services and dating.
Exel enjoys yet another top-up from US sale
11/26/2003
FREIGHT giant Exel is reaping more dividends from the sale four years ago of its Allied Pickfords removals arm. Exel sold it for $400 million ([pounds sterling]235 million) to North American Van Lines, now known as Sirva, and $34.5 million in shares.
In Sirva's US float this month, Exel is to get another $50 million cash and a $130 million stake.
New IFX chief seeking spread bet consolidation NEW IFX chief executive Edmond Warner is keen to be a consolidator in the crowded financial spread betting market. IFX's pre-tax losses for the half-year to 30 September were [pounds sterling]1.2 milion against an [pounds sterling]800,000 profit the year before on sales of [pounds sterling]9.3 million against [pounds sterling]9 million.
Hays on a high after selling freight division SHARES in Hays hit a 15-month high today, up 23/4p at 129p, after it as good as completed its exit from freight deliveries. Now focusing on its recruitment business, Hays said it had sold its logistics division to US venture capital house Platinum Equity for [pounds sterling]102 million.
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