Is there any actual difference between opening an FXCM Spread Betting Account and a micro/standard one if you live within the UK? (I would post links, but i sadly can’t yet)
If UK legislation allows spread betting Forex with the UK to be performed tax-free, then I dont really see how opening a UK spread betting account gives any benifits over opening a different one.
In fact - the spreads seem exactly same - the only main difference I can see is the opening balance requirements of 2000USD.
In terms of pricing and execution, there is no difference. Both the spreadbet account and regular micro/standard account use the same NDD forex execution.
If you are a resident of the UK or Ireland, then it may be to your benefit to choose the spreadbet account since spreadbet accounts enjoy special tax free status in the UK and Ireland.
Is the mobile trading available for the spread betting accounts?
The minimum opening bet is set at 10,000 units. Is there any particular reason for this given that you’re hedging the positions automatically in the underlying market?
Are subsequent additions to an existing position limited to the same minimum of 10,000 units?
Thanks, yep I know about the tax free status - but what I’m asking is, do you really have to open a special “Spread Betting” account to benefit from the tax free status. Surely as it falls under UK legislation (and not a call made from FXCM) if I live in the UK (as I do) then I shouldn’t pay the taxes regardless of what account I decide to open with them?
Forex accounts are subject to capital gains tax in the UK and Ireland as you’re buying and selling currency and classified as investing. Spread betting is different as you’re not actually purchasing / selling the currency instruments but placing a wager on their movements with a provider and these wagers would have to be in a different type of an account. The fact that FXCM hedge your position in the underlying market doesn’t matter. This is how they get spread betting classified as gambling and why it’s tax free as a result.
Yes, the mobile trading platform is available for spreadbet accounts.
Concerning the 10,000 unit position sizes…any subsequent additions to an existing position will have to be in increments of 10k as well. In order to trade a smaller lot size, you would need to open the micro account where the minimum trade size and trading increment is 1,000 (1k). The idea behind FXCM Micro is to offer micro size access to new traders who want to start off on a small scale. Whenever you trade a micro lot of 1k, the pip mark-up you are paying is also smaller therefore there’s a business decision made for which accounts to offer it on and the level of service that is provided.
Things could change. In fact as of two weeks ago, all new standard 10k accounts opened through FXCM US (LLC) are being setup with the ability to trade micro lots. Depending on how things go over time, I guess anything could be possible.
Yes, you do have to open the special “spread betting” account to benefit from the tax free status. Even though it’s the same product, it has to have a special classification for it to technically be considered spread betting…as odd as it may sound
