Spread Betting is a leveraged financial product. This means that you can take a larger position on the market without having to invest the full capital. Profit or loss is then calculated by multiplying the size of your stake by the number of points the market moves.
As a leveraged financial product, Spread Betting can be profitable, however, it also carries a certain level of risk. Although leverage can help you open larger positions on the market with a smaller initial investment, it can also compound any potential losses, especially in the absence of sound risk management.