Investing in equities requires capital.  Imagine you had a total of £1,000 to invest, and you thought the stock of company x – currently standing at 100p per share – was set to rise.  You could – of course – purchase approximately 1,000 shares.  And if the share price rose to 120p per share, you would have made £200 profit (less commission and stamp duty).   With a spread bet, with a spread of 101 -99, and a margin requirement of 10%, you could have ‘bought’ at £100 per point.  Closing that bet once the share price rose to 120, generating £1,900 profit.  The potential for upside leverage is, of course, matched with a downside leverage, but this is where successful traders make good use of ‘stop loss’ mechanisms.