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Spread betting: Setting your own size

One of the most important facets of

successful trading involves position sizing – that is, having a

larger position when the market is going your way and smaller

positions when it isn’t. That concept is treated a little

differently in U.S. markets than it is in the United Kingdom and

other markets.

In the U.S. stock

market investors can buy as many shares as the size of their account

can handle. While 100-share increments are more typical, you could

buy only a few shares if that’s all you could afford.

In the U.S. futures

markets contracts are a specific standardized size. For example, a

corn futures contract is 5,000 bushels at the Chicago Board of

Trade. At $4 a bushel, the total value of that contract is $200,000.

To trade a corn futures contract, you must put up an initial

performance bond or good-faith deposit (margin) of about $1,200, an

amount set by the exchange.

A number of futures