What Is Options Spread Betting?

What Is The Difference Between Spread Betting vs Options?

The key difference between spread betting and options is that spread betting allows you to bet on the price direction of an asset without owning the underlying market.

Under HMRC’s BIM22015, a spread bettor is not normally carrying on a trade, so most UK retail traders pay no Capital Gains Tax on spread betting profits. Under CG12310, an option held directly is a chargeable asset, taxed at 18% or 24% above the £3,000 annual exempt amount (2026/27 tax year). Our spread betting tax rules page sets out the full rules. Tax treatment depends on your individual circumstances and can change, so you should seek professional tax advice if you’re unsure.

A listed option trades on an exchange, and one share option contract covers 100 shares. Exercising a physically settled listed option delivers the underlying asset. An options spread bet works differently. It is a deal over the counter between you and your broker, sized in pounds per point, and it never delivers the underlying. Every options spread bet expires, on a daily, weekly, monthly or quarterly basis. The next section explains what an option is.

What Is Options Trading?

Options trading gives you the right, but not the obligation, to buy or sell an asset at an agreed price (called a strike price) on or before a specific date. When you buy an option, you’ll pay a premium to take out the contract, allowing you to profit if the market moves in your favour.

You can also sell options when markets are trading in a range or are falling, which is useful as you can collect the premiums upfront in low-volatility markets.

Buying caps your loss at the premium paid upfront. A bought call’s gain has no fixed limit, while a bought put’s gain is capped at the strike minus the premium. A sold call’s loss has no fixed limit, while a sold put’s loss is capped at the strike minus the premium received. The table below sets out all four positions.

Examples Of Options Spread Betting

Option Spread Bet Going Long Call Example

You buy a call on oil because you expect the price to rise before the option expires. A settlement below the strike loses your premium in full. A settlement between the strike and the strike plus the premium loses part of the premium. A settlement above the strike plus the premium puts the bet in profit.

Option Spread Bet Going Short Call Example

You sell a call because you expect the market to stay at or below the strike by expiry, and your broker pays you the premium. The market settles below the strike and you keep the premium in full. It settles above the strike and your loss is the rise past the strike minus the premium you received, with no fixed limit to how far it grows.

Option Spread Bet Going Short Put Example

Selling a put option is when you think the markets will not go lower than the current strike price.

By selling the put, you collect the premium and wait until the option expires, and if the price of the market is above the strike price, you’ll keep the premium as profit. A fall below the strike costs you the drop below the strike minus the premium you received. The most you lose is the strike minus the premium.

How Do You Spread Bet With Options?

You spread bet on an option in five steps. Pick the market and expiry, choose a call or a put to buy or sell, and select the strike. Enter your stake per point, then hold to expiry or close early. The walk-through uses the FTSE 100 put from the December 2023 screenshots, showing how a spread bet works in practice.

1. Pick Your Market

Choose the market you want to bet on, which can be a choice between indices, shares, forex, and commodities. Then, choose the expiration date of the option you want to spread bet on.

Options can expire at different times, and these are:

• End of day
• End of week
• End of month
• Quarterly

I have chosen the FTSE 100 Daily expiring 20th December 2023.

2. Choose Whether To Buy or Sell a Call or Put Option

Next, choose how you want to speculate on the FTSE 100’s price movements, then click the buy or sell price of the call or put. Buying means you pay the premium upfront, and that payment is the most you can lose. Selling means you collect the premium instead.

3. Select The Strike Price

Here, I have chosen to buy a put on the strike price of 7640.

The price is 14.40, so if I bet £1 per point, it will cost me £14.40 to open the spread bet option. This is also my maximum loss, so even if the market moves to 7670, I will still be in the option and capped at a £14.40 loss.

4. Enter Your Bet

Click the buy button at the £14.40 price and enter the bet size (I put in £1 per point).

Click place deal, which will execute the bet.

5. Wait until expiration (or close out early).

You can wait until the expiration and see where the market settles against the strike price of 7640. The bet shows a profit only if the FTSE 100 settles below 7625.60, the strike minus the 14.40 premium. Between 7625.60 and 7640, part of the premium is lost. At or above 7640, the whole £14.40 is lost.

It is possible to close the option earlier than the expiration date to capture any profitable moves early. For example, if the FTSE 100 plummeted to 7500 prices, you can close the bet early and take the profit.

What Markets Can You Spread Bet With Options?

The list below comes from IG’s and Spreadex’s own options pages, read on 19 Sep 2026.

• Commodities: IG lists metals and energies, and Spreadex’s examples cover gold and crude oil, both part of commodity spread betting.
• Indices: Index options include Wall Street on IG’s list, and Spreadex works through the UK 100.
• Currency pairs: IG lists forex options on the majors EUR/USD, GBP/USD, USD/CHF and EUR/GBP.
• Shares: Share options cover FTSE 100 constituents plus selected US shares, per IG’s options page.

What Strategies Can You Use For Options Spread Betting?

Spread betting on options also allows you to create specific strategies that can help in different market events, lock in profits if the markets don’t move, collect premiums from other options traders, and more.

Straddle.

This is a strategy where you spread bet on a call and put option with the same strike price and expiration date of the underlying asset.

The idea behind the straddle is that you can profit if the asset has a large movement up or down, but you’ll lose both premiums if the asset doesn’t move.

Which Brokers Offer Options Spread Betting In The UK?

Of the 14 brokers this site ranks, three offer options by spread bet on their own UK sites, read on 19 Sep 2026: IG, City Index and Spreadex. City Index’s UK options page now carries the StoneX Trading brand. The table below lists each firm’s FCA entity, its firm reference number and its overall score out of 100 from the overall broker ranking. The site scores brokers overall only and has no options score.

Is Spread Betting The Same As Binary Options?

No, spread betting is a bet staked in pounds per point, so your result is the points the price moves multiplied by your stake. A binary option bets on whether an event happens and pays a fixed pay-out when right. Source: FCA PS19/11, read 21 Sep 2026.

Binary bets are not sold to UK retail clients. The FCA banned the marketing, sale and distribution of binary options to retail consumers from 2 April 2019 (Policy Statement PS19/11, read 19 Sep 2026). The ban includes securitised binary options. No FCA-authorised spread betting provider offers binary bets to UK retail clients.

FAQ

Is Options Better For Spread Betting Or CFD Trading?

Options are available through both a spread betting account and a CFD account at IG and City Index. A spread bet is staked in pounds per point, while a CFD is not, and the tax treatment of the two differs. The spread betting and CFD trading page compares them in full.

Can You Trade Forex Options?

Yes, forex options are available by spread bet. IG’s UK options page lists forex options on the majors, including EUR/USD, GBP/USD, USD/CHF and EUR/GBP, read 19 Sep 2026.