Of the ‘big four’ spread betting companies, Capital Spreads is the one with the shortest track record, having originally been established in 1996 with the formation of the parent company London Capital Group, which was set up originally as a proprietary trading business and subsequently developed into an institutional broker. Capital Spreads was launched in 2003 specifically targeting the spread betting market and the proprietary trading business was subsequently sold off in 2005 at the same time as London Capital Group Holdings was floated on the AIM in December 2005. In 2008 London Capital Group Holdings acquired Prospreads.com, a spread betting company based in Gibraltar, which further strengthened the company’s position in the UK. You can find details of LCG latest share prices here.

Of all the companies listed here, Capital Spreads is perhaps the most interesting of all as it offers some unique and diverse spread betting opportunities, which are very different from the other three companies that we have looked at so far. Whilst the markets offered are much as you would expect from a major player in the spread betting market, their approach to their clients is very different and revolves around the area of risk. In essence what the company does is to automatically add a stop loss to your trading position based on the instrument, margin and trading equity, in order to protect you from yourself, with the company also holding an additional 20% of your funds to allow for slippage. Many would argue that this approach is heavy handed and over restrictive, but personally I believe this is an innovative and creative approach to the problems with are often self inflicted by novice traders new to spread betting. In limiting losses and protecting traders from themselves, I believe the company offers a unique service to its clients, where risk is managed and good trading practices automatically enforced. Personally I feel all spread betting companies should operate this policy and certainly for new clients, until they have a proven track record of trading, which would help to improve the image of spread betting overall from its rather shabby past.

In case you are wondering how the professional traders view this practice, LCG have Prospreads, which specifically addresses this issue by offering a completely separate platform for the professional spread betting client, with unique products which are also complimented by the company offering Direct Market Access across the platform for many of the instruments and markets offered. In addition the company offers the professional trader the opportunity to trade at the bid and offer inside the spread, providing the ultimate flexibility in trade management, and as such, a unique combination of two spread betting platforms. The first for novice and new traders, with the second available for professional spread betting accounts – altogether a very different approach and one that the industry has waited for, for many years.

So what of the trading platform and markets that the company offers? Well Capital Spreads have recently introduced a new trading platform which includes such handy features as stop and limit orders appearing on the trade tickets, a split screen facility with multiple screen options, and finally the option to have mutiple trade tickets on screeen all with a ‘tear off’ facility. Execution of orders is fast and very quick and easy, and you can test this out for yourself by downloading a free demo.

Below are the some of the prices and spreads for some of the most popular instruments for comparison as follows :

Main Indices

  • Daily FTSE 100  – the minimum spread is 1 index point and the minimum bet size is £3
  • Daily FTSE future – the minimum spread is 2 index points and the minimum bet size is £1
  • Daily Wall Street – the minimum spread is 1 index point and the minimum bet size is £1
  • Daily Wall Street futures – the minimum spread is 4 index points and the minimum bet size is £1
  • Daily Germany 30 – the minimum spread is 2 index points and the minimum bet size is £1
  • Daily Japan 225 – the mininum spread is 20 index points and the minimum bet size is £1

Major Currency Pairs

  • EUR vs USD – the minimum spread is 1 pip and the minimum bet is £1
  • GBP vs USD – the minimum spread is 2 pips and the minimum bet is £1
  • USD vs CAD – the minimum spread is 4 pips and the minimum bet is £1
  • USD vs JPY – the minimum spread is 2 pips and the minimum bet is £1
  • AUD vs USD – the minimum spread is 3 pips and the minimum bet is £1

Commodities

  • Brent crude oil futures – the minimum spread is 5 and the minimum bet size is £1
  • US crude oil futures – the minimum spread  is 6 and the minimum bet size is £1
  • Gold futures  – the minimum spread is 8 and the minimum bet size is £1
  • Silver futures – the minimum spread is 3 and the minimum bet size is £1

Stocks and Shares

  • Over 1500 UK shares available to trade
  • Shares in FTSE 100 would typically cost 0.1%  of the trade value

In summary, Capital Spreads is, in my view, both innovative and creative in it’s approach to the spread betting market, offering a diverse range of products on very different platforms, both of which are clearly differentiated. If you like the idea of having your trades automatically protected and the associated margin managed, then I would certainly recommend this company, and indeed it is my preferred choice amongst the four major spread betting companies compared here. Alternatively if you are a professional trader, then Prospreads would be my choice, as once again they provide a unique and refreshing alternative, with some unique twists! If you do decide to open a spread betting account with Capital Spreads, then the margin deposit will be between 3% and 15%, minimum spread of 1, and a trading minimum of £1 across the markets. The account opening minimum is £0 and the offer 24 hour trading, along with a demo account. At present there are no special offers available, but this changes all the time so do check before you open your trading account.