RBS Spread Betting Guide

RBS Spread Betting Guide

RBS Spread Betting Guide

arrow_forwardLive RBS Chart
arrow_forwardLive RBS Prices
arrow_forwardWhere to Spread Bet on RBS
arrow_forwardHow to Spread Bet on RBS


Live RBS Chart and Prices



Where Can I Spread Bet on RBS?

Most of the spread betting brokers will offer prices and charts on shares including RBS e.g.:

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How to Spread Bet on RBS

As an example, let’s suppose you want to spread trade RBS, so you go on a spread betting site, such as Tradefair, and see the live spread:

RBS Rolling Daily: 21.0p – 21.3p

Here’s an example of how it works…

The Market RBS Rolling Daily
The Spread 21.0p – 21.3p
This Means Now you can spread bet on the Royal Bank of Scotland Rolling Daily market to push:

  arrow_upward  Above 21.3p, or
  arrow_downward  Below 21.0p

This is a Rolling Daily market so it does not have an expiry date. If you decide not to close your trade and the session ends then your position will roll over into the next session.

Note that if a trade does roll over then you will either be debited or credited for overnight financing based upon the direction of your position.

For further details also see how a daily spread bet works.
Units (Points) Traded Spread betting trades on the Royal Bank of Scotland market are made in £x per penny.

Where a penny is 1p of the UK share’s price movement.

E.g. if Royal Bank of Scotland moves 50p then you would lose or gain 50 multiples of your stake.
Trade Size You work out how much you want to trade per penny, e.g. £1 per penny, £3 per penny, £15 per penny etc.
Simplified Example If your stake is £2 per penny and Royal Bank of Scotland moves by 33p, you would lose/win £2 per penny x 33p = £66.


Spread Trading Example | Taking a Bullish View of RBS

on the bank’s share price to rise

You Work Out Whether to Buy or Sell RBS moving:

  arrow_upward  Above 21.3p? or
  arrow_downward  Below 21.0p?

Let’s Say You Want to Buy   arrow_upward  Above 21.3p
You Choose Your Stake, Let’s Assume You Select £25 per penny
So Now What?
  • You win £25 for each penny Royal Bank of Scotland moves higher than 21.3p
  • Your trade loses £25 for every penny RBS goes below 21.3p
If You Are Betting on a Market to Rise Your P/L = (Closing Level – Initial Level) x stake per penny
 
Scenario 1 RBS climbs and the spread trading market changes to 24.8p – 25.1p.
Take a Profit? You may opt to leave your spread bet open or close it in order to lock in your profit. In this instance you decide to close your position and sell at 24.8p.
Your P/L = (Closing Level – Initial Level) x stake per penny
(24.8p – 21.3p) x £25 per penny
3.5p x £25 per penny
Your P/L = £87.50 profit
 
Scenario 2 RBS goes lower and the market is revised and moved to 18.5p – 18.8p.
Time to Restrict Your Loss? At this point, you could choose to keep your trade open or close it, i.e. close your spread bet to limit your loss. For this example, you decide to settle your bet by selling the market at 18.5p.
Your P/L = (Closing Level – Initial Level) x stake per penny
(18.5p – 21.3p) x £25 per penny
-2.8p x £25 per penny
Your P/L = -£70.00 loss


Fully Worked Spread Betting Example | Taking a Short Position on RBS

Spread trading on the share to move down in value

You Select Whether to Go Long or Short Royal Bank of Scotland going:

  arrow_upward  Above 21.3p? or
  arrow_downward  Below 21.0p?

Let’s Assume You Choose to Go Short   arrow_downward  Below 21.0p
You Select Your Stake, Let’s Say You Select £20 per penny
What Next?
  • Your trade loses £20 for every penny Royal Bank of Scotland goes higher than 21.0p
  • You win £20 for every penny Royal Bank of Scotland falls lower than 21.0p
When Spread Betting on a Market to Decrease Your P/L = (Initial Level – Closing Level) x stake per penny
 
Scenario 3 RBS moves lower and the financial spread betting market adjusts and moves to 14.6p – 14.9p.
Time to Lock in Your Profit? You may choose to leave your bet open or close it in order to lock in a profit. For this example, you opt to close your bet and buy the market at 14.9p.
Your P/L = (Initial Level – Closing Level) x stake per penny
(21.0p – 14.9p) x £20 per penny
6.1p x £20 per penny
Your P/L = £122.00 profit
 
Scenario 4 RBS goes higher and the spread betting market is adjusted to 25.5p – 25.8p.
Limit the Loss?At this point, you may decide to keep your trade open or close it, i.e. close your position and restrict your losses. In this case you decide to settle your position by buying the market at 25.8p.
Your P/L = (Initial Level – Closing Level) x stake per penny
(21.0p – 25.8p) x £20 per penny
-4.8p x £20 per penny
Your P/L = -£96.00 loss


RBS Notes:

  • Spread betting prices taken from Tradefair as of 10 January 2012
  • You could also choose to trade on the UK bank in euros/penny and dollars/penny
  • You can also trade UK stocks and share, like Royal Bank of Scotland, Glaxo, Ocado etc. with DFBs.

AuthorAlex Turner

Senior Editor, SpreadBetMagazine

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