The spoils of spread betting can be seriously substantial – and you don’t need to be a brilliant mathematician to profit from them. If you thought spread betting with a top spread betting company like Sporting Index was just for City types and possibly a bit too complicated for you, then think again.

An explanation, with examples of how spread betting works:

The principle behind spread betting is actually very simple. Rather than betting at fixed odds on the ultimate win/lose outcome of an event, a football tournament or an election for example, spread betting enables you gamble on the margin of the result. That means that the more correct your opinion, the more money you stand to make.

In a General Election, a spread betting company may take a view that the Conservatives will win 212 seats and consequently set a spread of 211-213. If you are confident that the Tories will get more than 213 seats, you might decide to ‘buy’ (go high) at 213. If, however, you strongly believe that they will be successful in less than 211 seats, you would ‘sell’ (go low) at 211.

If you ‘bought’ (or went high) at 213 at say, £5 per seat, you would receive £5 for every seat over 213 won by the Conservatives and lose £5 for every seat below 213. So, if the Conservatives won 263 seats, you would win 50 (263-213) x £5 giving you a profit of £250. If, however, only 173 seats are won by the Conservatives, you would lose 40 (213-173) x £5 giving you a loss of £200.

If you ‘sold’ (or went low) at 211 Conservative seats at £5 per seat and they succeeded in gaining only 173 seats, you would win 38 (211-173) x £5, giving you a profit of £190. But, if in this scenario they managed to get 221 seats, you would be facing a loss of £50 (10 x £5), because you were wrong by 10 seats.

You could find yourself in profit before a vote has even been cast. Imagine a poll was published after you bought Conservative seats that stated the Tories were much further ahead than anyone had previously thought. The spread might move from 211-213 to 220-222. In that case, if you had bought at 213 for £10 a seat, you could choose to sell at 220 and take your 7point (£70) profit. Your spread bet is "closed" and you have pocketed the profit. Alternatively you could choose to just let it run. The spread stays open and moves all the time, like a share price would for a company, so you can close the bet any time you like. You don't need to wait for the event to finish.

For another practical and simple example of a typical spread bet situation (in this case with football goals) click this link: explain spread betting.

In a football tournament like the World Cup, Sporting Index might offer a spread based on the number of points England or any other team is expected to get or the number of goals scored throughout the tournament. The same principles apply when calculating potential winnings or losses depending on the spread the firm sets and whether you decide to buy (go high) or sell (go low).

With such substantial profits to be made, it is not surprising that spread betting is one of the fastest growing areas of the gambling sector in the UK. There is nothing like a general election or a World Cup to goad existing spread betting fans into action or to bring new punters into spread betting so 2010 seems set to be a bumper year.

We advise you join the biggest and most-respected Spread Betting firm in the UK and that is Sporting Index. They account for 73% of the world spread betting market.

How many people are already taking advantage of the profits to be made from spread betting?

Back in June 2006, a major study reported that there were already nearly half a million punters with spread betting accounts in the UK. That figure has now more than doubled. The 2006 football World Cup was responsible for a significant boost in spread betting as the World Cup attracts the attention of punters looking to profit from their football knowledge.

When it comes to football, spreads are offered on more eventualities than the number of points gained by a team or the number of goals scored. You can bet on the time of a first goal in a match. The most common time period for a first goal is claimed to be between thirty seven and forty minutes by some statisticians, so you can expect to find the spread betting company's spreads in a similar range for many matches. You can also bet on the number of red and yellow cards proffered, the number of corners and a lot more besides.

In any high-profile tournament, whether it is football or tennis for example, the spread betting opportunities will be especially extensive. In 2010 you can place your spread bets and win a lot of money even if England don’t perform well in the World Cup, provided you read the spread correctly.

As with other forms of betting, patriotism will result in some major betting opportunities. There is a theory that national sentiment will push spreads up, providing plenty of chances for the more pragmatic punter to cash in on spread betting by selling the spread (or going low).

So how did spread betting come about?

A gentleman called Charles McNeil is generally credited with inventing the ‘point spread’ for sports gambling. McNeil obtained a Master’s degree at the University of Chicago and went on to teach maths at the Riverdale School in both Connecticut and New York. He also managed to fit in a securities analyst role in Chicago.

A keen gambler, he invented what is now known as the point spread, betting not merely on the probability of a final result, but on the predicted difference in the score. In the 1940s he opened his own bookmaking business. McNeil died in April 1981 leaving punters worldwide an invaluable legacy – spread betting on sports.

What else do you need to know about spread betting?

The good news is that, if you succeed in making absolute fortunes through spread betting, you will not have to worry about the attentions of the tax man. Your spread betting profits will not be subject to Capital Gains Tax or Income Tax, unless spread betting is your sole source of income. Unlike fixed odds gambling, spread betting is regulated by the Financial Standards Authority rather than the Gambling Commission.

Why should you think about trying your hand at spread betting?

If you bet £10 to win on a horse in a race at 5-1, you will only win £50 whether it wins by a nose or half the track. If it loses, you just lose your £10 stake. Sounds a bit boring really doesn’t it? So how about betting on the 'total winning distances'. Yes, there's a spread for that at every race meeting too.