French Stock Market Spread Betting Guide

French Stock Market Spread Betting Guide

CAC 40 Spread Betting Guide

arrow_forwardLive CAC 40 Chart
arrow_forwardLive CAC 40 Prices
arrow_forwardWhere to Spread Bet on CAC 40
arrow_forwardHow to Spread Bet on CAC 40
arrow_forwardWhere to Spread Bet on French Shares
arrow_forwardHow to Spread Bet on French Shares

Note that you can spread bet on individual French shares. However a more popular trade is normally the CAC 40, the main French stock market index, i.e. an index of 40 leading French shares.

With spread betting and CFD trading, the CAC 40 is often called the France 40 and FR40.

Here we talk you through the basics of trading both the CAC 40 and French shares.


Live CAC 40 Chart and Prices


What is the France 40? (aka CAC 40)

As with the Germany 30, the companies listed on the France 40 are included based on quarterly review.

At each review, the companies listed on Euronext Paris are ranked by the previous 12 months’ performance and forty are chosen for inclusion.

The market hours are between 07:00 and 17:15 (UK time).


Where Can I Spread Bet on the CAC 40?

A number of the more established brokers offer live charts & prices on stock markets indices including CAC 40, e.g.:

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Company Index Min
Stake
UK
100
Spread
Germany
30
Spread
Wall
Street
Spread
S&P
500
Spread
NASDAQ
100
Spread
Japan
255
Spread
Apply
Financial Spreads Review £0.50 0.8 (5) 1 (2) 1 (4) 3 0.5 8 Apply

Review
City Index Review £1 1 (+) 1 (+) 1.6 (+) 6 1 (+) 8 (+) Apply

Review
ETX Capital Review £0.50 1 (2,6) 1 (2,6) 1 (2) 5 1 (2) Variable Apply

Review
IG Review £1-5 1 (4) 1 (5) 1.8 (5.8) 5 (9) 1 (3) 8 (30) Apply

Review


How to Spread Bet on CAC 40

Let’s suppose that you are considering spread trading on the CAC 40, you look at a financial spread betting website, like InterTrader, and see the latest market of:

CAC 40 Rolling Daily: 3072.0 – 3073.0

Here is an example of how it works.

Spread Betting Market: CAC 40 Rolling Daily
Price (Spread): 3072.0 – 3073.0
What This Means: Now you can spread bet on the CAC 40 Rolling Daily market going:

  arrow_upward  Higher than 3073.0, or
  arrow_downward  Lower than 3072.0

This spread betting market is a ‘Rolling Daily’ market and so there is no settlement date for this trade. If you haven’t closed your trade and the session ends then your position will roll over into the next trading session.

Note that if a trade does roll over then you will either receive or pay a small fee for overnight financing depending on the direction of your trade.

Trading Units: Financial spread bets on the CAC 40 market are priced in £x per point.

Where a point is 1 point of the index’s price movement.

E.g. if the CAC 40 moves by 45 points then you would win/lose 45 multiples of your stake.
Stake per Unit: You work out how much you are going to stake per point, e.g. £1 per point, £5 per point, £8 per point etc.
Staking Example: If, as an example, you had a stake of £4 per point and the CAC 40 moves 22 points, you would win / lose £4 per point x 22 points = £88.


Fully Worked Spread Trading Example | Taking a Bullish View of the CAC 40

Financial spread trading on the index to go up in value

You Select Whether to Buy or Sell: The CAC 40 to move:

  arrow_upward  Higher than 3073.0? or
  arrow_downward  Lower than 3072.0?

Let’s Say You Buy:   arrow_downward  Higher than 3073.0
You Decide Your Stake, Let’s Say You Choose: £2 per point
What Next?
  • You gain £2 for each point the CAC 40 goes higher than 3073.0
  • You lose £2 for every point the CAC 40 pushes below 3073.0
When Betting on a Market to Increase Your Trading P&L = (Closing Price – Opening Price) x stake per point
 
Situation 1 The CAC 40 moves higher and the financial spread betting market becomes 3114.5 – 3115.5.
Time to Take Your Profit? You may decide to let your spread bet run or close it, i.e. close your position to lock in a profit. In this example you opt to settle your bet and sell at 3114.5.
Your Trading P&L = (Closing Price – Opening Price) x stake per point
(3114.5 – 3073.0) x £2 per point
41.5 points x £2 per point
Your Trading P&L = £83.00 profit
 
Situation 2 The CAC 40 moves lower and the spread trading market is revised to 3025.4 – 3026.4.
Restrict Your Loss? At this point, you may decide to keep your spread bet open or close it, i.e. close your position and restrict your losses. For this example, you decide to close your trade by selling at 3025.4.
Your Trading P&L = (Closing Price – Opening Price) x stake per point
(3025.4 – 3073.0) x £2 per point
-47.6 points x £2 per point
Your Trading P&L = -£95.20 loss


Worked Spread Trading Example | Going Short of the CAC 40

Spread trading on the index to fall in value

You Work Out Whether to Go Long or Short: The CAC 40 moving:

  arrow_upward  Higher than 3073.0? or
  arrow_downward  Lower than 3072.0?

You Might Want to Sell:   arrow_downward  Lower than 3072.0
You Select Your Stake Size, Selecting: £3 per point
Now What?
  • You lose £3 for every point the CAC 40 moves above 3072.0
  • You gain £3 for every point the CAC 40 moves lower than 3072.0
If You Are Speculating on a Market to Go Down Your Trading P&L = (Opening Price – Closing Price) x stake per point
 
Situation 3 The CAC 40 pushes lower and the spread betting market is moved to 3035.7 – 3036.7.
Take Your Profit? At this point, you can choose to let your trade run or close it to take your profit. In this example you choose to settle your position by buying at 3036.7.
Your Trading P&L = (Opening Price – Closing Price) x stake per point
(3072.0 – 3036.7) x £3 per point
35.3 points x £3 per point
Your Trading P&L = £105.90 profit
 
Situation 4 The CAC 40 climbs and the market is revised and is set at 3111.5 – 3112.5.
Close and Limit the Loss?At this point, you could opt to keep your spread bet open or close it, i.e. close your spread bet to restrict your losses. In this example you opt to close your trade and buy at 3112.5.
Your Trading P&L = (Opening Price – Closing Price) x stake per point
(3072.0 – 3112.5) x £3 per point
-40.5 points x £3 per point
Your Trading P&L = -£121.50 loss


CAC 40 Notes:

  • Financial spread betting market price obtained from InterTrader: 9 November 2011
  • Many spread betting companies will also allow you to spread bet on the CAC 40 in euros per point and US dollars per point


Where to Spread Bet on French Companies

You can trade a selection of leading French shares with:

How to Spread Bet on French Shares

Let’s suppose you are considering spread trading on Societe Generale, so you look at a financial spread betting site, e.g. FinancialSpreads.com, and see the real-time quote at:

Societe Generale Rolling Daily: €42.94 – €43.06

Here is what you can expect from a trade

The Market Societe Generale Rolling Daily
Spread €42.94 – €43.06
This Means That You can bet on the Societe Generale Rolling Daily market moving:

  arrow_upward  Higher than €43.06, or
  arrow_downward  Lower than €42.94

This is a ‘Rolling Daily’ trade and so there is no final closing date for this trade. If you haven’t closed your trade and the session ends then your position will roll over to the next trading day.

Note that if a trade is rolled over then you will either be charged or receive interest for overnight financing depending on whether you are speculating on the market to go up or down.

For further information see Rolling Daily Spread Bets.
Points (Units) Traded Financial spread bets on the Societe Generale market are made in £x per cent.

Where a cent is €0.01 of the equity’s price movement.

E.g. if Societe Generale moves by 55c (€0.55) then you would lose or gain 55 times your stake.
Stake per Unit You work out how much you want to stake per cent, e.g. £1 per cent, £3 per cent, £15 per cent etc.
Short Staking Example For example, if your stake is £4 per cent and Societe Generale moves €0.30 (30c), you would win/lose £4 per cent x 30c = £120.


Spread Betting Example | Taking a Bullish View of Societe Generale

Financial spread betting on the equity to go higher

You Decide to Buy or Sell Societe Generale to move:

  arrow_upward  Higher than €43.06? or
  arrow_downward  Lower than €42.94?

Let’s Assume You Go Long   arrow_downward  Higher than €43.06
You Choose How Much to Risk, Let’s Assume You Choose £2 per cent
So What Now?
  • You win £2 for each cent (€0.01) Societe Generale increases higher than €43.06
  • You make a loss of £2 for every cent (€0.01) Societe Generale falls lower than €43.06
When You Buy a Market Your P/L = (Final Level – Initial Level) x stake per cent
 
Situation 1 Societe Generale climbs and the spread trading market is revised and set at €43.81 – €43.93.
Close for a Profit? At this point, you can opt to let your bet run or close it, i.e. close your trade to lock in your profit. In this instance you opt to close your bet and sell the market at €43.81.
Your P/L = (Final Level – Initial Level) x stake per cent
(€43.81 – €43.06) x £2 per cent
€0.75 x £2 per cent
75c x £2 per cent
Your P/L = £150 profit
 
Situation 2 Societe Generale falls and the spread betting market changes to €42.35 – €42.47.
Close and Limit Your Loss? You could opt to keep your position open or close it, i.e. close your spread bet and limit your loss. In this case you choose to settle your bet and sell at €42.35.
Your P/L = (Final Level – Initial Level) x stake per cent
(€42.35 – €43.06) x £2 per cent
-€0.71 x £2 per cent
-71c x £2 per cent
Your P/L = -£142 loss


Spread Trading Example | Taking a Short Position on Societe Generale

Financial spread trading on the equity to go down

You Decide to Go Long or Short Societe Generale to push:

  arrow_upward  Higher than €43.06? or
  arrow_downward  Lower than €42.94?

You Might Choose to Go Short   arrow_downward  Lower than €42.94
You Decide Your Stake, Let’s Assume You Opt For £2 per cent
So Now What Happens?
  • You make a loss of £2 for every cent (€0.01) Societe Generale moves above €42.94
  • You win £2 for every cent (€0.01) Societe Generale falls below €42.94
If You Are Going Short of a Market Your P/L = (Initial Level – Final Level) x stake per cent
 
Situation 3 Societe Generale drops and the financial spread betting market is revised and is set at €41.99 – €42.11.
Time to Take Your Profit? You may choose to let your trade run or close it to lock in a profit. In this example you opt to close your position and buy the market at €42.11.
Your P/L = (Initial Level – Final Level) x stake per cent
(€42.94 – €42.11) x £2 per cent
€0.83 x £2 per cent
83c x £2 per cent
Your P/L = £166 profit
 
Situation 4 Societe Generale rises and the market is revised to €43.60 – €43.72.
Close and Restrict Your Loss?You could opt to let your position run or close it, i.e. close your position to limit your losses. For this example, you choose to close your trade by buying at €43.72.
Your P/L = (Initial Level – Final Level) x stake per cent
(€42.94 – €43.72) x £2 per cent
-€0.78 x £2 per cent
-78c x £2 per cent
Your P/L = -£156 loss


Societe Generale Notes:

  • Financial spread betting market price taken from FinancialSpreads.com as of 26 January 2010
  • Most spread betting companies also give you the option of financial spread trading on Societe Generale in euros/cent and US dollars/cent

AuthorAlex Turner

Senior Editor, SpreadBetMagazine

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