Spread Betting is a tax-free* financial derivate which allows traders to speculate on the price movement of financial markets.
With spread betting, as a trader you never actually own the underlying asset but are instead trying to predict whether your chosen market’s price will either rise or fall. If you are correct, this will result in a profit and if you are incorrect this will result in a loss.
If you predict that the value of a product will rise, you would open a long position (Buy) alternatively; if you predict that the value of a product will fall, you would open a short position (Sell).
*Under current tax law, spread betting is not subject to capital gains tax, however, tax laws are subject to change and depend on individual circumstances. Tax treatment may differ in a jurisdiction other than the UK.