please whats the difference between spread betting and day trading in shares? i understand in the UK, spread betting is tax free while day trading in the US markets from the UK will incur tax.

For a UK resident, is spread betting a fancy name for day trading in US Shares ? ( without tax).. i may have simplified things here but thats really my question.


  • Well, if the counterparty CFD order imbalance is backed or covered by futures contracts then that is a sufficiently stable situation. – S Spring Apr 26 '20 at 22:43

In the UK, spread betting and share trading/dealing are quite different, and there's lots of markets and assets you can spread-bet on besides US shares. The difference in tax treatment perhaps mainly comes from the fact that when spread betting, you don't actually take ownership of the shares being speculated on (which is why there's no CGT or stamp duty).

IG.com has a page with a big list of differences between the two approaches: https://www.ig.com/uk/spread-betting/spread-betting-vs-share-dealing and another one focussing on the advantages of spread betting https://www.ig.com/uk/spread-betting/benefits-of-spread-betting

I wouldn't recommend trying either of them to anyone. Both are a great way for novices to lose a lot of money.

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