It is highly likely that you or someone in your family will have owned shares at some point in their life.
Many people were given shares when British utilities were privatised in the 1980s and as building societies turn into publicly listed banks. You will probably be familiar with these shares such as British Telecom and Abbey National. The usual strategy for people with shares is to "buy and hold". This means they buy the share and hold on until they feel like selling. Usually the private investor will watch it go all the way up getting greedy about all the money and not selling then watch it go all the way down which is where they would get out at a substantial loss.
The advantage of fixed odds financial betting is that you get all the profit of price movement without the need for vast sums of capital. For example Lloyds TSB is currently around £5. You would need a large amount of money to just buy 1000 shares (£5000). To buy those shares you'd have to pay broker fees of around £15 and a further £15 when you wanted to sell it back. So you'd be out of pocket £5030 before you've even done anything. To top it off, you would to pay tax on any profits made!
However with fixed odds financial betting you don't own the share, you simple make money on the price movement. Fixed odds financial betting gives you a huge amount of flexibility, as you can see in the bet type list above.
Meaning if you placed a fixed odds financial bet thinking that Lloyds will touch £5.30 in a couple of weeks, you would be quoted the odds on that happening and therefore the cost of that bet. If for example the odds of this happening were quoted at 5 to 1 on a £100 trade you could win £500 (tax free!). A similar rise in the share price would have earned you just £300 (before the broker fees and tax). With fixed odds betting you wouldn't need to buy 1000 shares and the winnings are tax free.
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You will probably have heard of the stock market. I suspect for most people (including myself at one stage!) it was something you know exists, but never really get to grips with. So what are the main markets?
In most countries there will be a index or an average of that country's leading shares. The number of shares in each index of average varies from 500 to 30. The most popular ones are as follows:
FTSE (Financial Times Stock Exchange) - When people talk about the FTSE (pronounced "footsie") they are usually referring to the FTSE 100, which is the index of the country's leading shares. Shares listed on the FTSE 100 include well known companies such as Vodafone and the major banks. There are other UK indices you may hear about such as the FTSE 250, FTSE All Share, Techmark (Specialising in technology stocks), and AIM (for fledgling companies). However the FTSE 100 is by far the most active with billions of shares changing hands in one day.
DJIA (Dow Jones Industrial Average) - The "Dow Jones" is consists of the States' top 50 US companies (Microsoft, Coca Cola). As America is the worlds Biggest economy, movements in the Dow can have a knock on effect throughout the world. Other American Stock Indices are the S&P 500 (The top 500 US companies) and NASDAQ 100 (Specialising in technology stocks such as eBay).
There are many other indices, such as the DAX (Germany's top 30 companies), the CAC (France's top 30 companies).
Exchanges are world financial centres devoted to the exchange (buying & selling) of financial products, commodities etc. All the main Indices get their values from shares traded at stock exchanges. For example there is the LSE (London Stock Exchange) and the NYSE (New York Stock Exchange). Exchanges don't have to be in shares: the FOREX allows people to trade in foreign currencies and the CBOT (Chicago Board of mercantile exchange) allows people to trade in commodities such as Orange juice.
Don't worry about the details of the markets for now, the important point to remember is that these exchanges are like a non-fixed market where prices are changing constantly throughout the day and day today. The beauty of fixed odds financial betting is that you can bet in your own currency on the movement of many different things whether it is the S&P 500 or the Australian Dollar Vs the US Dollar.
Foreign Exchange is the simultaneous buying of one currency and selling of another. In the foreign exchange market currencies are always priced in pairs; therefore all trades result in the simultaneous buying of one currency and the selling of another. The FOREX market is an inter-dealer market that became more and more popular after 1971 when exchange rates were first allowed to float freely. Today the Foreign Exchange market is the largest financial market in the world with an estimated daily turnover of over $1.5 trillion.
Unlike other financial markets, the FOREX market has no physical location, no central exchange. It operates through an electronic network of corporations and individuals trading one currency for another. This lack of a physical exchange enables the FOREX market to operate on a 24-hour basis.
The objective of currency trading is to exchange one currency for another in the expectation that the market rate or price will change so that the currency you bought has increased its value relative to the one you sold. The individual trader can trade on the same terms as the major institutions regardless of trade size. Famous currency exchanges include the US Dollar/ EURO, GB Pound/ US Dollar, EURO/ GB Pound.
Fixed odds financial betting allows you to bet on a whole host of forex instruments within a day and over months.
