Spread Betting vs Cfd trading

Look-alike pair

Spread betting and CFD trading are both leveraged ways to speculate on price movements without owning the underlying asset. The single difference that matters is tax treatment: spread betting is generally exempt from capital gains tax in the UK, while CFD trading is not. This distinction shapes everything else, from how each is regulated to the costs you pay.

Side by side

	Spread Betting	Cfd trading
Tax treatment	Generally exempt from capital gains tax in the UK; no stamp duty.	Profits are subject to capital gains tax in the UK; no stamp duty.
Regulatory status	Regulated as a form of gambling by the UK Gambling Commission, but also subject to financial conduct rules when offered by FCA-authorised firms.	Regulated as a financial derivative by the FCA in the UK and by equivalent bodies in other jurisdictions.
Underlying market access	Widely available on financial markets (indices, forex, shares) and some sports, though financial spread betting is the focus here.	Primarily on financial markets: indices, forex, shares, commodities, and cryptocurrencies.
Cost structure	Costs are built into the spread; overnight financing charges may apply.	Costs include the spread and commission; overnight financing charges apply.
Field mark	The term 'spread' appears in the product name and pricing is quoted as a two-way price.	The term 'contract for difference' or 'CFD' appears in the product name and documentation.
Typical providers	Offered by spread betting firms, often the same companies that offer CFDs.	Offered by CFD brokers, often the same companies that offer spread betting.

Which word to use

Use spread betting when referring to the UK tax-exempt product, and CFD trading when referring to the broader financial derivative available internationally.

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