According to new research on the habits of UK spread betters, they are not a loyal bunch – or at least that’s what their providers will think. The Australian research firm Investment Trends reports that, for example, there are far more spread betting accounts active than there are investors due to the habit of investors operating more than one account.
The amount of traders who have switched their main provider is also enormous, with 29% switching in the last year. Financial providers have some of the most loyal customers of all (when was the last time you changed your current account?) so having just short of a third of providers switching is incredible. And the bad news for complacent spread betting firms doesn’t end there. The number of people considering switching is half.
What was also interesting in the report was the fact that people tended to bet on stock market indices more than any other investment. Why’s that? Obviously one reason was that people feel safer with big indexes that don’t move as fast as an individual stock can. However there’s also the issue of cost. Spread betting is notoriously hard to compare, but everyone knows that the spread betting providers cover charges within their spreads. However where there’s a decent amount of competition, as there is on FTSE bets, then there seems to be better rates on offer.
This is why our comparison table for spread betting is so useful. Hopefully if this catches on more providers will try to compete on price.