Excerpt from: Understanding Spread Betting
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| June 26, 2007 | | Do you have the stomach to place spread bets? | Spread betting is not for the faint of heart. Spread betting deals with volatile markets, where fortunes can change quickly, and price swings are common. It is important to understand your risk tolerance before you begin to place spread bets.
Risk tolerance consists of emotional/mental components as well as financial components. You need to know not only how much you can afford to lose when it comes to spread betting, but whether you can emotionally deal with the possibility of losses, and the tough choices you have to make quickly.
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