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Spread Bet Markets: Government Bonds
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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
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
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)
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
WARNING! - Spread Bet Broker Advice

There are good spread bet brokers and there are 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 (and I've used them for years) -

FREE Report : How to Learn Spread Betting and Prosper
How to build the all-important trading experience
Where to get trading help and advice
Which broker to use and why
Simple 2 month training plan to follow
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