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FAQ Page 3 - Question 31

Q: I prefer to trade US shares than UK ones, how do the spread betting firms handle the currency risk?

A: This is a good question. If you want to buy say Microsoft then although the shares will obviously be priced in Dollars the spread betting firms let you trade them with a Sterling amount per point.

• For example, you buy a spread bet in Microsoft at $28.00 risking £2 a point
• MSFT rallies and you cover the spread bet at $29.00
• Profit is 100 points X £2 = £200
• Because the bet was done in Pounds per point it doesn't matter what how Sterling moves against the Dollar in the interim
• And it's the same with continental European stocks, they quote in Euros but you trade with Sterling per point