Page 1 : Page 2 : Page 3 : Page 4 :

FAQ Page 4 - Question 35

Q: Can I use spread bets to play penny shares?

A: This all depends on the definition of a penny share. Some say a penny share is a company whose share price is quoted in pennies alongside a very small market capitalisation, say under £10million. Others call a penny share any company whose share price trades under say 25p regardless of market cap.

Back to your question. Spread betting firms will normally make a market in any share as long as a) the market capitalisation is above £30million (alongside a reasonable amount of shares in the float) and b) the client is going to do a decent sized trade, ie not £1 per point. Using these prerequisites I think it would be highly unlikely that one could get a market out of a spread betting firm for most if not all of the PLUS Market stocks.

However as I've been saying for many years now one of the beauties about spread betting firms is their flexibility. So call them up and ask them what you want and if Spread Bet A company won't quote you a market then there may be a chance that Spread Bet B company will.