Spread betting which basically involves the betting on high stakes regarding the movement of an asset without having prior ownership of an asset while at the same time offering several types of benefits which traditional trading simply cannot offer.
There were approximately 92,000 spread-betters as of July 2012 as compared to around 85,000 of by the third quarter of this fiscal year according to an independent study by research firm Investment Trends. However, the spread-betting market was able to maintain a stable trend over the course of five consecutive years respectively.
The principal and primary reason for the substantial drop-out rate can be attributable to the risky nature of the process of spread betting which a lot of inexperienced traders burn out due to the manner of trading which mainly utilises high leverage which many spread betters tend to be aggressive in their approach and losing many essential profit along the way.
In spite of the seemingly high drop-out rate of spread-betters, the market still continues to entice and attract new as well as old clients in the course of over two years. Just this year, 12,000 new clients joined the roster while another 22,000 plus latent traders recommenced their trading activities according to an independent study by Investment Trends.
Finally, the spread-betting market is narrow to begin with, yet a lot of companies are seeing a hefty potential to expand new horizons by attracting clients from traditional brokers in the market which many agree is now dynamic and susceptible to various changes.