Guide to New Zealand Dollar/US Dollar Spread Betting

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Financial Spreads: Spread Betting and CFD Trading

Where Can I Spread Bet on NZD/USD?

When using a Financial Spreads account clients can spread bet on a large range of currencies, for example you can trade on NZD/USD but also the EUR/USD, AUD/USD and GBP/USD.

Where Can I Access Live NZD/USD Prices?

When using a FinancialSpreads account investors are able to speculate on numerous real time prices like NZD/USD and a range of other foreign exchange, stock markets, equities and commodities prices.

Where Can I Get Live NZD/USD Charts?

When trading with a FinancialSpreads account investors can make use of live charts for NZD/USD and numerous other markets.

As well as the various display styles, the package also has a large variety of advanced functions:
Example forex spread betting chart:

Forex Spread Betting Charts



How to Spread Bet on NZD/USD

For example, let's imagine that you log on to Financial Spreads and the current price is:

  NZD/USD Rolling Spot Sell

0.7445
Buy

0.7447


Here's a brief guide to how the market works

Spread Betting Market:NZD/USD Rolling Spot
The Spread Trading Price:$0.7445 - $0.7447
What This Means:You can spread bet on the NZD/USD Rolling Spot market moving:

  Spread Betting Above $0.7447, or
  Spread Betting Below $0.7445

This is a Rolling spread betting market so it does not have a settlement date. If you decide not to close your trade and the trading session ends then your position will roll over to the next trading day.

If a trade rolls over then you will normally either have to pay or receive a small fee for overnight financing depending upon whether you are speculating on the market to move higher or lower. For additional information also see Rolling Spread Betting.
Points (Units) Traded:Spread betting trades on the NZD/USD market are made in £x per point.

Where a point is $0.0001 of the forex pair's price movement.

E.g. if NZD/USD moves by $0.0040 then you would win/lose 40 times your stake.
Stake (Trade Size):You work out how much you would like to stake per point, e.g. £3 per point, £4 per point, £15 per point etc.
Simplified Trading Example:With that in mind, if you decided on a stake of £2 per point and NZD/USD moves $0.0034 (34 points), you would win / lose £2 per point x 34 points = £68.


Trading Example - Going Long of NZD/USD

Financial spread trading on the currency pair to go higher

You Choose to Buy or Sell: NZD/USD to go:

  Spread Betting Above $0.7447? or
  Spread Betting Below $0.7445?

You Might Decide to Go Long:   Spread Betting Above $0.7447
You Select Your Stake Size, Choosing: £4 per point
What Happens Next?
  • You win £4 for each point ($0.0001) NZD/USD increases higher than $0.7447
  • You lose £4 for every point ($0.0001) NZD/USD decreases lower than $0.7447
If You Are Going Long of a Market Your P/L = (Settlement Price - Opening Price) x stake
 
Trading Situation 1
NZD/USD pushes higher and the spread trading market is moved to $0.7477 - $0.7479:   0.7477   0.7479
Time to Take a Profit? You could choose to let your position run or close it, i.e. close your trade to lock in your profit. For this example, you opt to close your trade and sell at $0.7477.
Your P/L = (Settlement Price - Opening Price) x stake
($0.7477 - $0.7447) x £4 per point (£4 per $0.0001)
$0.0030 x £4 per point
30 points x £4 per point
Your P/L = £120 profit
 
Trading Situation 2
NZD/USD slips and the market adjusts and moves to $0.7420 - $0.7422. I.e. you would see:   0.7420   0.7422
Close and Limit the Loss? You can choose to keep your spread bet open or close it, i.e. close your trade and restrict your loss. In this example you decide to settle your trade and sell the market at $0.7420.
Your P/L = (Settlement Price - Opening Price) x stake
($0.7420 - $0.7447) x £4 per point (£4 per $0.0001)
-$0.0027 x £4 per point
-27 points x £4 per point
Your P/L = -£108 loss


Spread Trading Example - Selling NZD/USD

Financial spread betting on the currency pair to move down in value

You Now Consider Whether to Go Long or Short: NZD/USD going:

  Spread Betting Above $0.7447? or
  Spread Betting Below $0.7445?

Let's Assume You Want to Sell:   Spread Betting Below $0.7445
You Decide Your Stake, Let's Say You Select: £3 per point
Now What?
  • You lose £3 for every point ($0.0001) NZD/USD rises higher than $0.7445
  • You win £3 for every point ($0.0001) NZD/USD moves below $0.7445
When Betting on a Market to Go Down Your P/L = (Opening Price - Settlement Price) x stake
 
Trading Situation 3
NZD/USD drops and the financial spread betting market is revised and moved to $0.7410 - $0.7412, therefore you would see:   0.7410   0.7412
Lock in Your Profit? At this point, you may choose to keep your bet open or close it to take your profit. In this case you opt to close your bet and buy at $0.7412.
Your P/L = (Opening Price - Settlement Price) x stake
($0.7445 - $0.7412) x £3 per point (£3 per $0.0001)
$0.0033 x £3 per point
33 points x £3 per point
Your P/L = £99 profit
 
Trading Situation 4
NZD/USD increases and the spread betting market is revised and changes to $0.7472 - $0.7474, therefore you would see this on Financial Spreads:   0.7472   0.7474
Time to Restrict the Loss?At this point, you can opt to leave your bet open or close it, i.e. close your spread bet and limit your losses. For this example, you decide to close your position by buying the market at $0.7474.
Your P/L = (Opening Price - Settlement Price) x stake
($0.7445 - $0.7474) x £3 per point (£3 per $0.0001)
-$0.0029 x £3 per point
-29 points x £3 per point
Your P/L = -£87 loss

Where Can I Practice Financial Spread Betting on NZD/USD?

FinancialSpreads offers traders the chance to put one's trading skills to the test by using a free Practice Account on CFD and spread betting markets like NZD/USD.

The Demo Account is not restricted to one market; traders can also get trading experience using a large range of forex rates, shares, commodities and index markets.

Open a Financial Spreads Demo Account


New Zealand Dollar Commitments of Traders Report - 15 May 2018


Futures Only Positions, CME , Code 112741, (Contracts of NZ$100,000)

Reporting Firms Non-Reportable Positions
Non-Commercial
Commercial Total Reportable
 
Commitments Open Interest Commitments
Long Short Spreads Long Short Long Short Long Short
28,754 26,801 440 27,040 26,376 56,234 53,617 59,874 3,640 6,257
 
Changes from 8 May 2018 Change in Open Interest Changes from
Long Short Spreads Long Short Long Short Long Short
-250 10,343 182 9,943 -1,005 9,875 9,520 10,149 274 629
 
Percent of Open Interest for Each Category of Trader
Long Short Spreads Long Short Long Short   Long Short
48.0% 44.8% 0.7% 45.2% 44.1% 93.9% 89.5%   6.1% 10.5%
 
Number of Traders in Each Category Total Traders  
Long Short Spreads Long Short Long Short    
28 43 8 13 10 45 57 91    
 
Long/Short Commitments Ratios   Long/Short Ratio
Ratio   Ratio Ratio   Ratio
1.1:1   1:1 1:1   1:1.7
 
Net Commitment Change  
-10,593  



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Also see:
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Spread betting & CFDs trading are complex instruments & come with a high risk of losing money rapidly due to leverage. 80% of retail investor accounts lose money when trading these products with this provider. You should consider whether you understand how these products work & whether you can afford to take the high risk of losing your money. Click here to see the risk warning notice.