Bets on the Market

Spread betting, a new investment strategy, features bookies who actually want their clients to win

Skeptics have long compared stock markets with casinos, with brokers as thinly disguised bookies. Guess what? In Britain, at least, some bookies are now acting like brokers and taking wagers on the directions of stock markets, an exercise called spread betting. The fad is rapidly gaining converts among serious investors as an innovative way to play markets, though a lot of others remain, well, skeptical.

Spread betting first hove into view in the mid-1970s, when a British sports bookmaker--betting is legal in Britain--devised an esoteric, high-risk means of gambling on the future of market indices. Instead of betting the fixed odds...

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