St Albans based broker, Spreadex, are set to introduce Bitcoin to their Spread Betting platform from 15th January 2018.
The move comes as Bitcoin’s rally in 2018 takes it back above $16,000 following heavy losses in the second half of December which saw prices fall from a high of $20,000.
The new Spreadex Bitcoin daily future price will be based off the underlying futures price offered by the CME Group. Traders should note that the CME Bitcoin Futures market is currently not open at the weekends; which means that Bitcoin can only be traded with Spreadex from Sunday night until Friday evening when there is a derivative price available. This means that when the market is closed, you will not be able to close your position.
This may also be the case where excessive volatility impacts on the availability of the market. If Spreadex are unable to provide a price on Bitcoin, traders will not be able to close out their positions.
The Armchair Trader says:
It is not uncommon for the Bitcoin price to move 20% in a single day. Combining these sorts of movements with exposure to margined trading products like spread betting means that volatility at times could be off the scale.
Traders should also consider the market opening times here too, when deciding whether to open a position. There is the potential for large gaps in the price from Friday’s close to Sunday’s open.
It’s high risk and we would suggest the Spreadex option would only be suitable for experienced day traders that prefer to trade short term positions.
You can find out more about Spreadex Bitcoin launch here.