Three things every new spread better should do

Novice spread betters can often get their fingers burned. But that needn't happen. Tim Bennett oultines three vital things to do that will help you get off to a winning start.

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For a beginner, spread betting can seem daunting. There's all the new jargon to master, for starters. And some markets such as commodities and currencies move very fast. Stories abound of how novices get their fingers burned. It's enough to put you right off.

But that's a pity. With a bit of effort you can ensure you are armed and ready when you decide to place your first bets. Like learning a new language or skill, spread betting rewards time invested. Just like any other type of investing, spread betting is no fast track to untold riches. So what can you do to build up your knowledge?

Use the web. These days there is a mass of information available much of it free on how to spread bet. Try out your broker's free demo. And, of course, read ourspread betting tips and blogs. None of this will cost you anything other than your time.

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Practise, practise, practise. Start with very small bets. Stick to one market and one security say the FTSE 100 index. And get good. Learn from your mistakes and never increase your bet sizes on a whim or because you are bored! In short, develop a strategy don't just take random punts on whatever index, commodity or currency caught your eye over breakfast.

Learn from others. There are plenty of people out there doing what you are doing. Many will swap ideas. So hunt down fellow spread betters on Twitter and on internet blog sites. Sure no-one is going to give away their next trade idea for nothing but there are plenty of folk out there who will happily brag about their last few successful trades. Use this information to learn it's much quicker than working everything out by yourself!

Tim Bennett

Tim graduated with a history degree from Cambridge University in 1989 and, after a year of travelling, joined the financial services firm Ernst and Young in 1990, qualifying as a chartered accountant in 1994.

He then moved into financial markets training, designing and running a variety of courses at graduate level and beyond for a range of organisations including the Securities and Investment Institute and UBS. He joined MoneyWeek in 2007.

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