Taking a position on US jobs, rate hikes and Euro-geddon
SPREAD betting has changed the way that retail clients can get exposure to financial markets, and spread bet providers are constantly coming up with new ways to allow easy access to an ever increasing range of markets.
Though forex, commodity and equity markets can give you access to most market movements, here are three offerings that allow investors to take a more direct approach to recent headlines.
1 US NON-FARM PAYROLLS
US non-farm payroll figures are published at 1.30pm on the first Friday of every month. According to IG Index, the period following this announcement is frequently the busiest dealing period of the month with more than 5,000 transactions carried out in a minute.
These labour figures are seen as a key indicator of the strength of the US economy. On Friday, the dollar-sterling price fell off a cliff when figures came in at 18,000 – significantly less than the predicted 105,000.
You can take a position on the sterling-dollar price as this is heavily affected by non-farm figures that deviate from expectations. But the IG Index spread bet on non-farms gives you the chance to take a position on the figure directly.
2 EUROZONE BREAK-UP
With the Eurozone in perpetual crisis, many find it difficult to imagine the survival of the European experiment in its current structure – particularly with a single currency in place.
Although gold and Swiss franc prices have acted as strongly inverse-correlated proxies for the perceived fortunes of the Eurozone, the WorldSpreads euro break-up spread bet allows investors to take a position on how many days they believe the single european currency can continue in its current guise.
Optimists can bet higher than 690 if they think the euro will last longer than 690 days from 1 January 2011. If you are wrong and it collapses in 300 days from when WorldSpreads opened the market, the loss is 390 times the stake. Pessimists can bet lower than 680 if they think the euro will break-up within 680 days. If it dies in 300 days, the win is 380 times the stake. The market will last until Friday 27 September 2013 and all trades still open at that date will be settled at 1,000 days from 1 January 2011.
3 INTEREST IN INTEREST RATES
With central banks such as the European Central Bank (ECB), the Bank of England (BoE) and the Federal Reserve all attempting to balance inflationary pressures and anaemic growth, interest rate speculation continues to be of growing interest for spread betters. City Index offers clients the opportunity to speculate on future movement of interest rates. According to Joshua Raymond, chief market strategist for City Index, “the Fed and BOE appear to be on a different path to that of the ECB, with the European Central Bank recently hiking rates on Thursday in an effort to curb high inflation, while the BoE and Fed remain static on the prospects for a hike in rates.” Raymond adds: “Views range as to when a first rate hike by the Bank of England for over two years will come.”