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Spread Bet Markets: Government Bonds
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Last update : July 2010
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Page Summary:
This page looks at the individual Government bond contracts offered by the Spread Bet brokers including some points to watch out for. |
Spread bets are offered on all the major Government Bonds, including -
- Gilts (UK)
- US Bonds - T-Bonds, 5 & 10 year Notes
- Euro Bonds - The Bund, Bobl and Schatz
- JGB - Japanese Govt. Bond
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| Points to consider |
- No daily cash bets are offered on the bond contracts, only the quarterly bets
- All non US bonds are priced in decimals
- US T-Bonds and T-Notes are priced in 32nds and 64ths respectively but the spread betters will quote them as decimals, so a 5 year Note that is trading at 110 49/64 is quoted at 110.245
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| Interest Rate Spread Bets |
| The spread betting firms don't offer an individual market on interest rates but they quote the short term money market contracts, including - |
- Short Sterling (UK interest rates)
- Euro Dollar (US rates - although called Euro Dollar it has nothing to do with Europe or the Euro)
- Euribor (European interest rates)
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| These contracts are simple to understand. If the Short Sterling mid price is 98.78 that equates to an interest rate of 1.22% (100.00 - 98.78). Buy these contracts if you think rates will fall and sell short if you believe rates are going to climb. |
| Points to consider |
- Interest rate contracts move slowly, a large daily move is 15+ points
- There are no daily cash bets offered, only quarterly bets
- Many months are offered to trade, for example say it is Jan 2009 there will be Mar, Jun, Sep and Dec contracts for both 2009 and 2010
- Traders who use these markets normally hold positions for many weeks if not months
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| The importance of getting the right spread bet broker |
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There are good spread bet brokers and bad ones. Having a good broker won't guarantee you profits but a bad broker will probably lead to losses as a combination of their gamesmanship and suspect software takes its financial toll.
So who do I recommend? Simple, the 2 brokers I personally use for my own spread betting. Read this page for more details.
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FREE Report - How to Learn Spread Betting and Prosper
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How to build the all-important trading experience
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Where to get trading help and advice
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Which broker to use and why
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Simple 2 month training plan to follow
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Download the FREE report |
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Read more in the Spread Betting section:
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