Spread Betting Strategies UK: Trend & Mean Reversion (2026)
Two Time-Tested Spread Betting Trading Strategies
What is the best spread betting strategy in the UK?
You’re here because you’re exploring spread betting strategies.
Maybe you’re new to spread betting Maybe you already trade, but want something more structured…
After more than 25 years in the markets, one thing becomes very clear…
There is no single “best” spread betting strategy.
- Markets change.
- Conditions change.
- What works in one market regime gets smashed in another.
So instead of throwing a dozen random setups at you…
This page focuses on two simple, time-tested spread betting strategies that you can use on a variety of markets and timeframes.
Trend continuation Mean reversion
If you understand when to apply each, and how to manage risk properly, you’ll be ahead of most traders…
Let’s get started…
Table of Contents
How £ Per Point Pricing Simplifies Risk
Spread betting trades the same markets as CFDs or futures. The difference is the wrapper.
With a spread betting account:
- Your capital sits in GBP
- Your position is priced in £’s per point
- And for UK residents, spread betting profits are currently tax-free
That £ per point structure makes risk very clear too.
Let’s say your stop is 100 points away:
- £1 per point bet size = £100 risk.
- £2 per point bet size = £200 risk.
There’s no ‘contract conversion’, no exchange-rate calculation, no wondering what a tick is “worth” in real money. Like you might have to do with CFDs or futures.
You see the risk in the trade instantly.
And that’s important when you’re applying the spread betting strategies below.
Ok, let’s get into them…
Spread Betting Strategy #1 - Trend Continuation Framework
“The best way to make money is to identify the trend and then follow it.” – Stanley Druckenmiller
Trend trading strategies make one big assumption:
This move is likely to continue
So, if the market is in an uptrend (moving higher), then you are looking to buy in expectation of that move continuing.
A downtrend? The same thing…
Instead of fading a market, you are following a market.
In practice, trend strategies often involve:
- Buying price pullbacks
- Using key levels
- Support and resistance at inflection points
- Using moving averages as dynamic support/resistance
- Letting price action trigger the entry
- Technical indicators like RSI
When Trend Trading Works Best
Trend trading strategies work best when the market is in what we call “price discovery mode”
Fresh highs or lows.
Most traders screw up here and try to fade the move
“It’s gone too far”
“It must turn soon”
Well, sadly, many traders have gone broke trying to guess the end of a trend…
Mean reversion has its place in the financial markets (we’ll explore that next), but your default thinking should be this…
If price is in a trend, expect that trend to continue
And yes, I know it seems simple, but honestly, the path to consistency is littered with traders who overcomplicate things.
Trend traders often like to spread bet gold and silver, as the precious metals often go through prolonged trend cycles.
(I’ve written a full gold spread betting guide if you want to go deeper on that…)
The Core Idea
So the question becomes…
“How do we enter the trade in a way that risks as little as possible… while still giving the trade room to work?
That’s our job…
How to Enter a Trend Trade Using Technical Analysis
1) Pullback Entries
Pullbacks are basically just temporary counter-trend moves.
The process for trading them is:
1. Let price pull back
2. Look for evidence that the pullback is losing steam
3. Enter as the trend resumes
And we can trigger that in a few ways.
Option A: Structure / Support
Look for price to hold a level on the pullback.
That “holding” tells you buyers are stepping in.
Option B: Moving Average Support
Same idea, but the moving average is your dynamic support level.
5, 10, 20, 50… It’s less about the “perfect” number, and more about consistency.
Here’s the same trend day on the FTSE 100 using both approaches.
Your job as a trader is to start identifying markets that are clearly trending, and then study how price builds structure along the way…
2) Breakout Entries
If you feel timing pullbacks is too much of an art, and you want a simple trade trigger, I’ve got you covered…
Wait for the market price to break the prior high (or low in a downtrend) and use that as the trigger.
In an uptrend:
Price pulls back You wait for the prior swing high to break Your stop often sits below the pullback low
Simple. Effective.
The opening range breakout strategy is a great example of a breakout entry.
Stop Loss and Risk in Trend Trading
Stop losses are non-negotiable!
Even in a strong trend, pullbacks can go further than you expect… and sometimes trends fail completely. Which can lead to you losing money rapidly.
And we don’t want that…do we?!
A good stop does two things:
Allows some noise Kills the trade if the idea is wrong
A few common approaches:
- Fixed stop (ATR, % of range, or points)
- Under the most recent swing low for longs (above swing high for shorts)
- Trail the stop as price moves in your favour (stair-step)
Sadly, there’s no “perfect” stop.
There’s just a stop that makes sense for the job:
capture the trend… without getting shaken out by normal noise.
Common Trend Trading Mistakes
Most traders blow it in one of these ways:
- Trading trend methods in choppy, range-bound markets
- Taking profits too early (you finally catch a trend… then bail on the first pullback)
- Overthinking every pullback instead of waiting for your trigger
- Oversizing and getting emotionally attached
Your job as a trader is pretty boring:
✅ Follow the process.
✅ Use the stop.
And let the market do the heavy lifting.
Trend Trading Strategy: In-Depth Examples
Spread Betting Strategy #2 - Mean Reversion
Mean reversion is basically the opposite of trend continuation.
Instead of expecting continuation, you’re expecting rotation.
The premise is simple:
This move has stretched too far. It’s likely to rotate back toward a mean.
But here’s the key:
We are not blindly fading trends here…
Mean reversion works when the market is not trending.
When Mean Reversion Works Best
The straightforward answer is: This strategy works best in range round conditions:
When there’s no price discovery.
Breakouts failing.
Price rotating back and forth around a reference level.
That reference (the “mean”) might be:
- VWAP
- A moving average
- A key prior level
- The middle of a defined range
- A gap fill after an overnight or weekend gap
Market context and regime matters.
In strong trends, this strategy gets punished…
But in rotational markets? That’s where it can be really effective.
The Core Idea
Step one: Identify a non-trending market.
Step two: Wait for price to reach an extreme within that range.
Step three: Let it try… and fail.
Only then do you consider a trade back toward the mean…
You’re not trying to predict the turn here.
You’re waiting for rejection first.
And then you’re targeting A to B moves. Not hitting it for six.
Singles and doubles add up!
How to Trade Range-Bound Markets
Patience is key here.
We need to wait for:
- The right conditions
- The test of extremes
- Evidence of failure
Then execute.
Our job is not to guess where the market turns.
Our job is to wait for it to prove it has turned…
(That one habit alone can save you serious money.)
Stop Loss Placement in Mean Reversion
Managing risk when trading mean reversion is the same as any strategy…
You must use a stop loss; if you’re wrong, you’re wrong. No big deal, take the small loss and move on…
It’s when traders let small losses turn into big losses that they get hurt.
Common approaches:
- Stops above daily highs or lows
- % or tick-based stops
If the range breaks and holds, you’re wrong, get out.
The danger isn’t being wrong, it’s staying wrong when the market starts to trend…
Common Mean Reversion Mistakes
Most damage comes from:
1. Fading strong trends
2. Entering before rejection
3. Impatience
4. Oversizing
Three golden rules for you:
• Wait for conditions
• Wait for extremes
• Wait for failure
That’s it…
Mean Reversion Strategy: In-Depth Technical Analysis Examples
Prefer video? Here’s the full breakdown with some chart examples.
Choosing the Right Spread Betting Strategy for Your Trading Plan
Spread betting successfully comes down to one thing:
Using the right strategy for the right market conditions…
– If you try to buy breakouts in a range-bound market, you’ll get chopped up.
– If you keep fading new highs in a runaway trend, you’ll get run over.
There’s no magic formula; a lot of it is screen time.
Over time, you start to recognise context better…
And once you can judge context well, everything becomes a little bit simpler.
Because almost every trading strategy you’ll read about or use falls into one of two categories:
- Trend continuation
- Mean reversion
You either expect the market to continue or you expect rotation.
The real skill is asking yourself:
“Is this market more likely to trend… or reverse?”
Get good at that question, and you’ll be ahead of most traders.
(If you want a deeper breakdown of specific setups, playbooks and strategies, I’ve put together a full trading strategy library you can check out.)
Execution Matters
Trend and mean reversion both rely on clean fills and tight spreads.
If execution is inconsistent, your edge shrinks fast.
Make sure your platform supports the strategy you’re applying.
Spread Betting Strategy FAQ: Risk, Stops and Execution
Is spread betting considered high risk?
Yes… and it should be treated with respect. These are complex instruments, and this is not a risk free environment…
Leverage magnifies both success and failure. Used properly, it’s a tool. Used carelessly, it leads to rapid losses. Spread betting is not suitable for everyone, and traders must be honest about their own risk tolerance before committing real capital.
How important is a stop loss when spread betting?
A stop loss is non-negotiable!
Because spread betting gives you full exposure to price movements with leverage, not using a stop loss is effectively gambling with unlimited downside.
A well-placed stop loss defines risk before you enter the trade and protects your trading capital when the market moves against you.
Most successful spread bettors think about the stop loss first, then work backwards to position size.
A price correction can move way more than you expect.
How should I decide my bet size when spread betting?
Bet size should always be driven by risk, not by how confident you feel.
A sensible process is this:
1. Decide how much of your trading capital you’re prepared to risk on a trade
2. Identify where the stop loss must go based on the chart
3. Adjust bet size so the loss is acceptable if the stop is hit
This keeps losses small and avoids emotional decision-making during high volatility.
Are spread betting strategies suitable for day traders?
Yes, many UK day traders prefer spread betting because of its flexibility and simplicity.
Tight spreads, fast execution, and the ability to trade both rising and falling markets make it well-suited to intraday strategies.
However, day trading does require discipline. Without clear rules, frequent trades can quickly add up to significant losses. So watch how the market moves intraday, study price movements, and take it steady.
Is tax-free spread betting suitable for beginners?
It can be, but only if approached carefully.
A smaller initial deposit, conservative bet sizes, and a focus on one simple strategy are essential. Many beginners jump straight into live markets without understanding margin requirement, volatility, or execution mechanics, which leads to unnecessary losses.
Using a demo account first is strongly recommended.
Should I practice spread betting strategies on a demo account?
Yes. A demo account allows you to learn the mechanics of the global markets without financial risk.
It won’t replicate the emotional pressure of real money, but it helps you understand how spreads, stop losses, buy price, sell price, and execution actually work. For new traders, this step alone can prevent a lot of expensive mistakes before you start trading for real.
How do spread betting strategies differ from CFD trading?
The £-per-point structure, GBP-based accounts and the tax treatment all make spread betting structurally different. Read my
Full guide to CFD vs Spread Betting to explore how CFDs work vs spread bets.
Keeping everything in GBP is a real advantage when you’re trading an asset like forex or US stocks that may have currency conversions needed.
Is spread betting legal and regulated?
Licensed brokers must comply with strict rules around retail investor accounts, leverage limits, and client protection.
Always ensure your broker is regulated, as local law matters, and rules can vary by particular country
What are some other popular spread betting strategies?
I have a comprehensive list of trading strategies here.
Most (if not all) of these apply to spread betting.
Some traders are pure chartists; others combine technical and fundamental analysis.
Great traders like Linda Raschke like to use technical indicators or volume indicators.
But ultimately, your trading strategy is up to you. It doesn’t matter if you trade FTSE, US stocks, Dow, Dax, Nasdaw or Soybeans! It’s your trading, so you do it your way.
By Mark Holstead
25+ Years Trading Experience
Last updated: February 2026
Mark Holstead brings hands-on trading experience across equities, indices, forex and commodities. Over the years, he has trained traders and worked with trading firms to develop structured, risk-focused trading frameworks.
He writes to help UK traders build disciplined strategies and trade with long-term consistency.