What Is The Spot Price? | Spot Rate Definition And Example | IG UK

Skip to content

Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 67% of retail investor accounts lose money when trading spread bets and CFDs with this provider. You should consider whether you understand how spread bets and CFDs work, and whether you can afford to take the high risk of losing your money. Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 67% of retail investor accounts lose money when trading spread bets and CFDs with this provider. You should consider whether you understand how spread bets and CFDs work, and whether you can afford to take the high risk of losing your money.

More from IG

• Personal
• Professional
• Institutional
• • Academy
  • Help

• Inbox
• Academy
• Help

• Log in
• Open account

My account

• My IG
• • Inbox
  • Academy
  • Help
• • Personal
  • Professional
  • Institutional
• Logout

Open

• About us Show submenu for About us Main menu

  ABOUT US

  • About us
  • Professional trading
  • Our charges
  • IG reviews
  • Out-of-hours trading
  • Best execution
  • Media centre

  FIND OUT MORE

  • Refer a friend
  • Contact us
  • England Cricket partnership
  • Contact us
    • Reduced minimums
  • What we do with your money
  

  £0 commission on US stocks

  Apply now
• Trade Show submenu for Trade Main menu

  TRADE

  • Discover trading
  • Platforms and tools
    • Algorithmic trading
    • Compare platforms
    • DMA trading
    • How to choose the best options trading platform for you
    • L2 Dealer
    • Discover our trading app
    • TradingView
    • Trading with APIs
    • What is paper trading

  HOW TO TRADE

  • Spread betting
    • What is spread betting and how does it work?
    • How to spread bet
    • Benefits of spread betting
    • Spread betting vs share dealing
    • Spread betting calculator
  • CFD trading
    • What is CFD trading and how does it work?
    • How to trade CFDs
    • Benefits of CFD trading
    • CFD trading vs investing
    • CFD trading calculator

  WHAT TO TRADE

  • Indices
    • What are indices?
    • What is the VIX and how do you trade it?
    • How to trade or invest in the S&P 500
    • How to trade or invest in the NASDAQ
    • How to trade or invest in the FTSE 100
    • How to trade or invest in the Dow Jones
    • How to trade or invest in Taiwan Index
    • How to trade or invest in Hang Seng Index
    • How to trade or invest in the DAX
  • Shares
    • How to trade or invest in shares
    • Most traded shares in the UK
    • What are stocks, shares and equities?
    • Thematic and basket
    • After-hours trading
  • Commodities
    • What are commodities and how do you trade them?
    • Silver trading
    • Gold trading
  • Forex
    • What is forex and how does it work?
    • The benefits of forex trading
    • How to trade forex
    • How is forex trading taxed in the UK?
    • Forex Signals
    • Forex need-to-knows
    • Forex trading calculator
  • ETFs
    • How to trade or invest in ETFs
    • What are ETFs and how do you trade them?
  • IPOs
    • What are IPOs and how do they work?
    • How to trade IPOs
    • Upcoming IPOs
    • Revolut IPO
    • Monzo IPO
    • OpenAI IPO
    • SpaceX IPO
    • Stripe IPO
    • Ant Group IPO
    • Brewdog IPO
    • Databricks IPO
    • EG Group IPO
    • Gousto IPO
    • GymShark IPO
    • JLR IPO
    • Lamborghini IPO
    • Lunaz IPO
    • McLaren listing
    • PureGym IPO
    • Rimac IPO
    • Universal Music IPO
  • Bonds
    • How to trade or invest in bonds
    • What are bonds and how do they work?
    • What are corporate bonds?
    • What are government bonds?
  • Thematic and basket
    • What is thematic investing?

  DISCOVER MORE

  • Weekend trading
    • Weekend GBP/USD
  • Spot
    • How to trade spot markets
  • Options
    • Daily options trading
    • How to trade stock options
    • Weekly and monthly options trading
    • What are options and how do you trade them?
    • Implied volatility percentile
    • Vertical spread
  • Algorithmic trading
    • What is automated trading?
  • Futures
    • Futures vs forwards
    • What are futures and how do you trade them?
  • Create an account
  

  Trading need-to-knows

  Discover trading
• Crypto Show submenu for Crypto Main menu

  CRYPTO

  • Crypto
  • Service Fees
  • Crypto need-to-knows
• Invest Show submenu for Invest Main menu

  INVEST

  • IG Invest
  • Transfer investments
  • Invest campaign

  HOW TO INVEST MYSELF

  • Share dealing
    • What is share dealing and how does it work?
    • Costs and fees
    • Comparison
    • Transfer investments
  • Stocks and shares ISA
    • What is an ISA and how does it work?
    • Share dealing ISA
    • Smart Portfolio ISA
  • SIPPs
    • What is a SIPP and how does it work
    • Pension Calculator

  MANAGE INVESTMENTS FOR ME

  • IG Smart Portfolio
    • Costs and fees
    • Investment Calculator
    • Risk Returns
    • What is a managed investment portfolio?

  WHAT TO INVEST IN

  • Shares
  • ETFs
  

  Investing need-to-knows

  Discover investing
• Learn Show submenu for Learn Main menu

  LEARN

  • Strategy and planning
  • IG Academy
  • Trading need-to-knows
    • what is trading
    • Best trading websites
    • What is margin trading?
    • What is a brokerage account?
    • What are derivatives?
    • Trading for beginners
    • OTC trading: what is it and how do you start?
    • How to trade stocks online
    • Learn to trade
    • How to pick a trading broker
    • How to get into trading
    • How to find the best day trading platform
    • How to choose the best platform to trade stocks
    • How to choose the best trading app in the UK
    • How to choose the best forex broker
    • How to choose the best beginners' trading platform
    • How does leverage work in forex trading?
  • Investment need-to-knows
    • Investing for beginners
    • Why invest in shares?
    • What is the stock market?
    • What is a stock exchange?
    • What are Robo-Advisors?
    • How to invest in shares
    • How to invest in index funds
    • How to choose the best investment platform
    • ETFs vs Stocks
    • How to use the price-to-earnings ratio
    • Dividend yield explained: what it is and why it matters
    • Understanding the price-to-book (P/B) ratio
    • Market cap explained: what it is and why it matters
  • Options trading need-to-knows
    • What is a covered put strategy and how does it work?
    • What is a calendar spread and how do you use it?
    • Your beginner's guide to trading options
    • Iron condor
    • What are call options?
    • What are put options?
    • Poor man's covered call
    • Implied volatility
    • VXX options
    • Options expiration
    • How to use a covered call options strategy
    • What is a naked put and how does it work?
  • Crypto need-to-knows

  DISCOVER MORE

  • Demo account
  • Glossary of trading terms
  • Trade live with IG
  • Seminars and webinars
  • The Art of Investing
  

  Do you want to try out the IG platform?

  Set up a demo account
• Platforms and tools Show submenu for Platforms and tools Main menu

  PLATFORMS AND TOOLS

  • Platforms and tools
    • Algorithmic trading
    • Compare platforms
    • Platforms and tools
    • DMA trading
    • How to choose the best options trading platform for you
    • L2 Dealer
    • Discover our trading app
    • Trading charts
    • TradingView
    • Trading with APIs
    • What is paper trading
  • Discover our trading app

  THIRD-PARTY PLATFORMS

  • TradingView
  • MetaTrader 4
    • What is MetaTrader 4 and how do you use it?
    • MetaTrader 4 indicators and add-ons
    • Download MetaTrader 4
    • MetaTrader 4 (MT4) for Mac
    • MetaTrader 4 demo account
    • MT4 VPS
    • MT4 vs ProRealTime
    • MetaTrader 4 web
  • ProRealTime
  • L2 Dealer

  TOOLS

  • Economic and trading calendar
  • Trade analytics tool
  • Trading signals
  • Stock screener
  • Trading alerts

  DISCOVER MORE

  • Demo account
  • Trading with APIs
  • DMA trading
  

  Explore which platform is right for you

  Compare our platforms
• Market analysis Show submenu for Market analysis Main menu

  MARKET ANALYSIS

  • News and trade ideas
  • Economic and trading calendar
  • Stock screener

  DISCOVER MORE

  • Trade live with IG
  • Special reports
  • Subscriptions and downloads
  

  Watch our latest video content

  Get inspired

• Personal
• Professional
• Institutional

• Inbox
• Academy
• Help

Open account Open account Search No results found

View more search results

1 2 3 4 5 6 7 8 9 10 Related search: Market Data

Market Data	Type of market

See all Market data search results >

• Learn Glossary of trading terms

Spot price definition

What is the spot price?

The spot price or spot rate is the current value of an underlying asset, for which it can be bought or sold with the expectation of immediate delivery. The term ‘spot price’ is often used in commodities and forex markets.

Learn how to trade commodities

Find out how you can trade a range of commodity futures with IG.

Learn more

Spot prices vs futures prices

The main difference between spot and futures prices is the time of execution and delivery. While spot prices are for immediate buying and selling, a futures contract will delay the payment and delivery to a predetermined date in the future.

The terms contango or backwardation describe the relationship between the spot price and futures price. Contango is a market condition where the futures price is currently higher than the spot price of the underlying, while backwardation means the futures price is currently trading lower than the spot price of the underlying.

While the difference between spot prices and futures prices is an important distinction in the commodities and forex markets, it is less relevant for the stock market – as physical shares are always traded at the current market price. However, spot prices and futures prices are important on stock options, equity index futures and single-stock futures.

Example of a spot price

In forex, the spot price is sometimes referred to as the spot rate, and it is the quoted exchange rate between two currencies in a forex pair. For example, if the quoted exchange rate for EUR/USD was $1.2354, then that is also the spot rate. This figure shows that you would have to spend $1.2354 in order to buy €1.00.

For an example of the spot price in the commodities market, let’s look at Brent crude. If the spot price of Brent was currently $55.00, it means that you could pay $55.00 now and receive immediate delivery of the amount of oil that you bought.

However, if you were trading on a futures price of $57.00, it means that you would be opening a contract once the price of the contract meets the futures price. For example, once the market value exceeded $57.00, you would execute the trade and receive delivery of the underlying.

Learn more about trading spot markets with us

Build your trading knowledge

Discover how to trade with IG Academy, using our series of interactive courses, webinars and seminars.

Go to IG Academy

A - B - C - D - E - F - G - H - I - J - K - L - M - N - O - P - Q - R - S - T - U - V - W - Y

See all glossary trading terms

Learn more

• News and trade ideas

• What is CFD trading?

• IG's trading apps

• Spread betting vs. CFDs

• How to spread bet

• What is forex?

Markets

Forex

Indices

Shares

Options

Other markets

IG services

Spread betting

CFD trading

Share dealing

Trading platforms

Web platform

Mobile trading

MetaTrader 4

ProRealTime

Compare features

Learn to trade

The Week Ahead

News and trade ideas

Strategy and planning

Help and support

Contact us

IG | Sitemap | Terms and agreements | Privacy | Cookies | Investors | Modern slavery act

Follow us online:

• Facebook
• Twitter
• LinkedIn
• YouTube
• Instagram

Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 67% of retail investor accounts lose money when trading spread bets and CFDs with this provider. You should consider whether you understand how spread bets and CFDs work and whether you can afford to take the high risk of losing your money. 

Professional clients trading spread bets and CFDs can lose more than they deposit.

Options and futures are complex instruments which come with a high risk of losing money rapidly due to leverage. They’re not suitable for most investors. Before you invest, you should consider whether you understand how options and futures work, the risks of trading these instruments and whether you can afford to lose more than your original investment.

Trading stocks and shares ‘on margin’ within a US options and futures account – meaning that you only finance part of the cost of acquiring a position in a security – carries additional risks over buying securities on a fully funded basis and may result in losses exceeding your original investment. Trading on margin will also result in additional costs to you as the investor and any securities purchased using margin may be held as collateral by the lender, restricting both your rights as shareholder, and your ability to use the securities until the margin trade is closed. You should familiarise yourself with these risks before trading on margin.

The value of shares, ETFs and other ETPs bought through a share dealing account, a US options and futures account, a stocks and shares ISA or a SIPP can fall as well as rise, which could mean getting back less than you originally put in. Past performance is no guarantee of future results. Some ETPs carry additional risks depending on how they’re structured, investors should ensure they familiarise themselves with the differences before investing.

Share dealing and IG Smart Portfolio accounts provided by IG Trading and Investments Ltd, CFD accounts and US options and futures accounts are provided by IG Markets Ltd, spread betting provided by IG Index Ltd.   

IG is a trading name of IG Trading and Investments Ltd (a company registered in England and Wales under number 11628764), IG Markets Ltd (a company registered in England and Wales under number 04008957) and IG Index Ltd (a company registered in England and Wales under number 01190902). Registered address at Cannon Bridge House, 25 Dowgate Hill, London EC4R 2YA. IG Markets Ltd (Register number 195355), IG Trading and Investments Ltd (Register Number 944492) and IG Index Ltd (Register number 114059) are authorised and regulated by the Financial Conduct Authority.   

The information on this site isn’t directed at residents of the United States, Belgium or any particular country outside the UK and isn’t intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.

© 2003-2025

Careers | Marketing partnership