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What is spread trading? This video is sponsored by CoreSpreads Australia. The term 'spread trading' denotes the 'spread'. The spread is the difference between the price you buy at and the price you sell at. The costs to deal are included in the spread and there are no additional commission to pay which is why it is important to find a broker with tight spreads. The more active you are in the market that money adds up so the tighter spread, the better. So how does it work? Say the German Index (DAX) might be quoted 12301 12502. You can buy at 12502 (go long) or sell at 12301 (go short).

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Disclaimer

69.9% of retail investors lose money when trading CFDs and spread betting with this provider. You should consider whether you understand how spread bets and CFDs work, and whether you can afford to take the high risk of losing your money.