Does the B Book Model in spread betting really still exist in the current financial climate?

Broker of the month: City Index, read our expert and client reviews here

The B Book model is a term spread betting and fx brokers use to a assign a category of clients that consistently lose money.  There are generally three books, and the terms vary between geographical location and broker so think of the allocation loosely.

The A Book

Is a main body of the client base that the broker hedges or nets off positions against.  They are fairly natural on the profitability of these customers and take a low risk approach to their trading.

The B Book

Iis assigned to clients who always lose money.  These are generally smaller new accounts that the broker will not hedge against.  It’s a fairly standard way to make money as a bookie.  It’s not as bad as it sounds as the broker is providing a very low cost way for small punters to access the world’s financial markets.  It would not be cost effective to only generate income from these customers from spreads and finance charging.  On average it costs a spread betting broker about £1,000 in advertising sped to get a new customer, so they need to aim to earn more to be profitable.  The B Book is usually assigned to the FX, Index and Bond markets, where trades are small er but of higher frequency than the equity market.

The C Book

Doesn’t really have a place in today’s market as the rules towards firms operating their own prop books and personal account (PA) trading are now very strict.  In the past though, spread betting brokers used to be well aware of the clients that always made money.  They would sometimes follow the trades to make a bit of money trading themselves.  Now, through it’s too much of conflict of interest between the broker and the clients so doesn’t really happen now.

Featured Spread Betting Brokers

Spreadex ETX Capital IG

City Index

ETX Capital


Best for traders with large accounts. A solid all rounder with institutional pedigree. Best for traders with large accounts. A solid all rounder with institutional pedigree. Best for experienced traders with large range of markets and tight spreads and cryptocurrencies
Visit City Index
Read Expert & Client City Index Reviews
Visit ETX Capital
Read Expert & 30+ In Depth Client ETX Capital Reviews
Visit IG
Read Expert & 3+ Client IG Reviews

Sponsored Good Money Guides