What is a brokerage account and how do you open one?

Use your spread betting and or CFD trading account to go long or short on the price market movements and get exposure to the underlying assets. The tax-free¹ feature has made spread betting a popular choice in the UK. When spread betting, it can be easier to manage position sizes since you’d be trading per point vs per contract or lot, which is what would happen when you trade CFDs.

You don’t have to pay capital gains tax when trading on spread bets. And gains you make when trading CFDs can be used to offset losses you may incur. You also don’t pay stamp duty when trading spread bets or CFDs because you won’t take ownership of the underlying assets.¹

Spread bets and CFDs are leveraged products, meaning you can open a position with an initial deposit – called margin – which is a fraction of the full value of your position. The profits and losses you make will still be based on the full size of your position, which can outweigh your margin. Trading with leverage has associated risks as compared to non-leveraged products like share dealing. Remember to manage your risk carefully.

With us, you can use your spread betting account to trade forwards in the shares, forex and ETF markets as well as futures when trading commodities and indices. With your CFD trading account, you can trade the spot price, futures and options of shares, ETFs, commodities, forex and indices markets.

If you’d like to trade intra-day, then you’ll find spread betting and CFD trading accounts are better suited for you. Both accounts are also suitable for trading in the short and medium term.

You can use a share dealing account to buy and sell shares and ETFs. You’ll open this kind of account when your intention is to buy and hold stocks with hopes to sell once the stock’s price increases. When investing using a share dealing account, you can also earn dividends from the shares you own, provided the company makes for such a provision.

You can’t short a position on this type of account, meaning when stock prices fall, you won’t make a profit. So, if you’re looking for medium-to-long-term investment opportunities, then share dealing is more suited to you.

Another alternative is to open a share dealing ISA account, which offers a more liquid investment opportunity for stocks and shares. You’ll then be able to optimise returns since its more tax-efficient compared to a standard share dealing account. You can contribute up to £20,000 for the tax year and any profits you make are tax-free.^{1, 2}

IG Smart Portfolios are diversified and will give you an exposure to global markets, equity, fixed income, and alternative investments such as gold and property. Our Smart Portfolios are more suited for you if you’re looking for long-term diversified investments managed by experts. Assets under your portfolio will be based on pre-specified mandates and objectives.

Your portfolio will be built to suit your investment needs and risk appetite. The portfolio will also track iShares ETFs from the world’s largest asset manager – BlackRock. With us, you can choose from these five portfolios:

• Conservative
• Moderate
• Balanced
• Growth
• Aggressive

Each portfolio has different percentages allocated to markets to align risk constraints with return objectives.

Managed portfolios are also available as flexible ISA accounts. You can contribute up to £20,000 for the tax year. Profits gained are tax-free.¹