Spread Betting Glossary

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Asset-backed securities; ie. securities backed by mortgage loans or such like which are obtainable if the creditor defaults.
Account Limit
The total amount of deposit required from a client at any one time based on the size of the trade.
The physical assets behind commodity securities.
American Depositary Receipt. Also known as ADRs. These are shares of foreign companies listedon exchanges in the USA. ie. US traded shares in British companies.
After hours deal
Aka as after hour trading. The practice of buying and selling shares during a period of time (usually 30 mins) after the major markets are officially closed. Generally reserved to institutional investors. During results season after hours trading can see large rises or falls in the share price of a company who has just announced quarterly results. The stock exchange closes at 4.30pm but deals are often done after this time and the transaction dated the following day. Some spread betting providers will make a market on different products even after the underlying exchange has closed or before it is open - for instance even though the LSE closes at 4.30pm it might still be possible to trade BP up till about 9.00pm
the Alternative Investment Market, a UK trading market used by smaller companies looking to raise finance. The Alternative Investment Market is as such the thriving junior stock market for smaller companies run by the LSE. AIM listed shares avoid full compliance with LSE rules.
Alexander's Filter
A method that measures the rise or fall of a share price in percentage terms over a given period. A fast rate of increase suggests a buy; the reverse, a sell.
Allotment letter
A document showing that you have been allotted a certain number of newly issued shares.
Derogatory term used mostly by IG traders to denote clients who only spreadbet to take advantage of arbitrage situations. But alpha is also a measure of the stock price that filters out the effects of stock market fluctuations.
American Option
Can be exercised at any time during the life of the contract. European options, by contrast must be exercised on the expiry date.
Employed by investment banks and brokers to study companies and markets and make investment recommendations.
Annual General Meeting (AGM)
As the name implies it's the once-yearly shareholder meeting. It's the time investors - big and small - get to question the board and vote on pay and changes to the company's constitution. Every company must have an AGM each year, to allow shareholders to vote on the accounts, directors and dividends and question the board on the company's affairs.
Annual Report
The yearly independently audited report to shareholders which must be produced by all publicly quoted companies. The Annual Report & Accounts used to be a thick, glossy booklet that contains the results, all the key financial stats and rundown of the company's performance over the year.
A form of pension bought from an insurance company.
When two assets trade at different prices, the opportunity for an arbitrage can arise. Sometimes a security can trade at two different prices on two different exchanges. In these scenarios the security can be bought on one exchange and sold on the other. When the prices come back into line both positions can be closed out for a risk free profit. Using these different market prices to make a combination of bets that will leave you in profit regardless of the outcome. These sorts of opportunities are rare however. As such arbitrage refers to the action of profiting from the difference in price for similar securities in different markets. Also, the attempt to profit by exploiting the price difference for the same financial instrument from one spread betting company to that of another. So basically here bettors take advantage of quotes in the same market where there is a divergence of opinion between spread betting providers so that by buying with one firm and selling with another they can guarantee themselves a profit no matter what the final outcome of an event.
Person, or organisation that makes a profit from identifying where the market has got its pricing of currencies and stocks wrong.
Articles of Association
A document setting out the objects and administration of the company.
also called 'offer'. Indicates a willingness to sell a future or share at given price. The price at which you can buy a share. Opposite to Bid.
Ask Price
Also known as the 'offer price'. The price at which a seller is willing to part with his/her assets.
At best
An order to a stockbroker to get the best possible price he can obtain for your benefit as opposed to limiting your order to a fixed price.
a system in which buyers and sellers enter competitive bids and offers simultaneously.
Once yearly examination of the company's accounts.
Audit Committee
Independent wing of a company's board that signs off the company's accounts.
Auto Sales
Car sales are tremendously important to the US economy but their volatility can make them an unreliable indicator. New models introduced at the end of summer and in early spring tend to have a disproportionate influence on sales figures. That said, strong figures are a good sign that consumer demand is picking up. They can be seen as indicating higher future production if demand is sustained over three or four months. The size of the item in question and the timeliness of the release allow auto sales to be a useful leading indicator of retail sales and personal consumption expenditures data.

Release Date: Around the 13th of each month
Release Time: 13:30 GMT
At the money
where the strike price of an option is equal to the current market level. For example FTSE 100 index is trading at 6,100 in the cash, then the 6100 series of option will be at the money.
Average Down
The practice of opening a new position at a lower price with the view of bringing the average price of your holding down.