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FAQ Page 3 - Question 28

Q: Any thoughts on spread bets versus Single Stock Futures (SSF)?

A: The idea behind Single Stock Futures or SSF's is a good one. Unfortunately most of them suffer from a lack of liquidity which in turn means that the bid-offer spread is wide. This translates into them being far more expensive to trade than either Spread Bets or Contracts for Difference (CFDs). SSF's are also liable for capital gains tax.

Until the daily volumes increase which looks unlikely, stick to other trading vehicles which have altogether tighter bid-offers spreads. Remember the cost of doing business is one of the factors, so if it's cheaper to deal (smaller bid-offer spreads) then this goes straight on your bottom line.

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