Financial spread betting in principle closely resembles the futures and options markets, the main differences include:

• The 'charge' occurs through a wider bid-offer spread; spread betting has a different tax regime when compared with securities and futures - it is actually tax free to the customer
  
• spread betting is more flexible since it is not limited to exchange hours or definitions, can create new instruments very easy, and may have guaranteed stop losses;
• the trading is off-exchange, with the contract existing directly between the market-making company and the client, rather than exchange-cleared, and is thus subject to a lower level of regulation.