US broker will spread the bets on the net

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The Independent Online

Spread betting, the high-stakes favourite of the City's gamblers, is on a drive for still more converts through the internet.

Cantor Fitzgerald, the US broker, will this week launch a website offering the full range of spread betting services over the web and hopes to expand the global customer base thirty-fold.

The concept of spread betting has been around since the mid-1980s, but it was soon obvious that the genre, which began with betting on sports, could be readily applied to the financial markets.

A player can call one of the services, ask for a spread on a particular stock, and then buy points at any chosen value.

If the stock rises, the player wins the size of the points rise times the value paid for each point.

If the stock falls, he loses by that margin. Players can also sell the spread.

At £1 per point, the game can be played for fun, but at £100 per point, winnings and losses can run into the hundreds of thousands of pounds.

But despite its high-risk appeal, worldwide there are only 50,000 players.

David Buick of Cantor Fitzgerald said: "Spread betting is a superb product that has unfortunately been woefully marketed."

Of the 3,000 gamblers who bet regularly each week, the great majority are based in the City of London. Mr Buick is keen to use Cantor's internet site as a way of expanding both in the UK and overseas.

Cantor's eventual target is to build the global market to 1.5 million regular customers.

The new internet site offers an educational section, where would-be betters can learn how the system works in a simulated environment.

The most the uninitiated can lose is a virtual shirt. Cantor hopes also to scoop its competitors by being the first to offer spreads on stocks in the Nasdaq, Dow Jones Industrial Average and S&P 500. Spread betting companies hedge stakes against the futures market, and Cantor's history as a financial house has given it an advantage.

Another tactic Cantor has employed is to poach employees from its established competitors.

It has already wooed a total of 12 old hands from its rivals IG, Sporting Index and Financial Spreads.