How does city index work?

Trading with City Index offers a versatile platform for engaging in the financial markets. Clients have the option to trade indices through two primary methods: spread betting and CFDs (Contracts for Difference).

Spread betting is a popular choice among traders due to its tax-efficient nature and potential for leverage. It involves speculating on the direction of an index's movement, with profits or losses determined by the difference between the opening and closing prices.

Alternatively, CFDs allow traders to speculate on the price movements of indices without actually owning the underlying asset. This method provides access to a wide range of indices, allowing traders to diversify their portfolios and potentially profit from both rising and falling markets.

City Index clients can decide whether to trade the cash price or the futures price of an index. Cash indices represent the current market value of an index and are traded instantaneously, with no expiration date.

Trading cash indices can be beneficial for traders who prefer flexibility and the ability to hold positions for extended periods. These markets can be used in both long-term and short-term strategies, making them a versatile tool for various trading styles.