Many investors will choose to employ spread betting as a powerful tool to capitalise upon market movements while mitigating the levels of risk that may otherwise be present with more traditional trades. It is nonetheless a fact that adopting the correct strategy is essential in order to enjoy substantial returns. Spread bets are short-term positions by their very nature, so it is prudent to reassess one’s methodology on a regular basis. What can we expect to encounter during March 2017 and how can traders leverage such information to their advantage? Let’s look at a few major topics which should be examined.

The Bears are Back in Town

It must first be highlighted that March (much like the remainder of 2017) is set to be a rather unpredictable month. This has less to do with fiscal policies as it involves the influence of the political arena upon the world of trading. Many investors are averse to higher levels of risk and therefore, it is logical to expect a bearish stance within many circles. This very same sentiment has been echoed by many respectable fund managers.

How will this apply to spread betters? The majority of enthusiasts are likely to narrow their margins in order to minimise the chances of a substantial loss occurring. They will also lessen the length of time between expiry periods; potentially offsetting any late-breaking news which may affect the value of a particular underlying asset.

Index-Based Trading

During times of unpredictability, many spread betters will seek to lessen their exposure to individual shares by entering into the index markets. This is an interesting choice for two reasons:

• As a whole, indices are less susceptible to knee-jerk reactions.
• Indices are great indicators of the state of the economy as a whole.

As there is always an index open in some region of the world, investors can access valuable information and adopt lucrative positions during any time of the day. This 24-hour edge is not often seen with other options such as traditional stocks or CFDs.

One Eye on Interest Rates

Most spread betters take into account any predicted movements associated with the benchmark interest rate of the United States. In recent news, the Federal Reserve Chair Janet Mullen hinted that these rates may experience a hike in March (2). This is due to strong domestic economic data combined with rising inflationary figures. Any hike in interest rates will help to bolster the value of the dollar. Still, we should keep in mind that such a hike may negatively impact other sectors such as the housing market within the United States. It is also important to note that the mere hint of a rate hike might not necessarily signal that such a move will ultimately occur. Once again, this is another reason why spread betters should watch the news carefully every day.

Gold Predictions for March

Gold is always a save-haven investment, so it is only logical that we should examine the predicted prices associated with the coming month. Two scenarios could arguably occur. Assuming that the Federal Reserve raises interest rates, the value of the dollar will rise. This should lead to a slight sell-off within the gold markets. The other possible situation is that political uncertainty continues to grip the states. Even if the dollar strengthens, investors may still be looking to place their funds into risk-averse sectors such as precious metals. Subsequently, we should expect the prices of gold to rise moderately during the next four weeks.

The Best Strategies to Adopt

As we can see, it already appears as if there is no single strategy which is a sure-fire means to accrue wealth through spread betting. The three principles which should therefore be highlighted are:

• Prudence
• Patience
• Short-term and medium-yield margins

Capitalising on such positions is made even easier when CMC Markets is chosen as a spread betting platform. Over 9,500 products are currently available and thanks to a robust selection of risk management tools, traders can enjoy potentially significant profits even within a bearish market.