For many gamblers in the UK, the upcoming British election is just another betting event and with the odds of the current Labour Party winning being as short as 1-20, many turn to the more financially oriented 'spread betting' to gain a profit.

The Times offers a simple explanation of the difference between conventional betting and spread bettingLike playing on the stock market, with spread betting you predict an outcome to be higher or lower than a given quote - and buy or sell on that spread.

Whilst normal fixed odds betting offer you a fixed outcome against a quoted price such as 10-1 or 5-2, in spread betting the gains or losses are usually unlimited

For example, with fixed odds betting - if the odds of an event are 1-5 and you place $5 on that event. If you win, you win a $1 profit

However, spread betting is based on the supply and demand of a given quote - using research from opinion polls and trend data. A person can buy or sell against this quote and the more people that buy, the more the spread moves

A simple example is the amount of 'seats' to be won in the election.
The spread could be 360-363. If you think Labour would win more seats, you would buy this at 363. If you think they would do worse, you would sell at 360.

If you buy at $1 and Labour win 375, you have won a profit of $12. However, if you buy at $1 and they only win 350, you've made a loss of $13

The stakes are clearer higher with the uncertainty of market movements in spread betting (the market spread continuously shifts like any financial market)

Its a dangerous game to play - the gains can be huge, so can the losses. However, you can cut your losses at any time by closing your bet and many firms offer a 'stop loss' option that automatically closes your bet so you don't lose too much