But, of course, it is easy to lose that deposit that you have, so potentially you could make a 100% loss by losing the 45 pounds. At the same time, you can make a 100% gain very easily. We saw that you can make 110 pound profit. That’s over 100%, that’s 200% profit. Leverage can magnify your gain. It can also magnify your losses.

Now, what we do at Capital Spreads is that our system will apply automatic stop losses. That means that if a trade in spread betting goes against you, if a market goes against you there will always be an order, a stop loss attached to your open trade, and if it reaches that level, your trade is closed for a loss that designed to help mitigate losses. You can amend your stock loss, of course, but to illustrate something about these stop losses is that they are not guaranteed against market gapping.

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