The Dublin-based company, which will operate both online and by telephone, is headed by chief executive Mr Conor O'Neill, an actuary and founding director of Life Strategies consultancy which was sold in 2000 for €5 million.

The chief operating officer is Mr Michael O'Shea, whose background is in technology. Other shareholders include former head of AIB Group Treasury Mr Dermot O'Donoghue, who will be chairman of the company.

With stock markets in a three-year decline, more sophisticated investors have turned to spread betting in an effort to capitalise on market volatility. Spread betting allows investors make money even on a falling market.

While the company will initially deal only in the Irish, US and leading European markets and their major companies, additional products will be added as demand arises and the liquidity of the relevant market allows. Customers will have to open an account and deposit money in it before being allowed to take positions on the movement of indices or shares.

The major attraction of spread betting is that it is tax-free. Unlike dealing directly in shares, there is no stamp duty and winnings are not liable to income tax or capital gains tax. On the downside, losses can be dramatic and gamblers stand to lose all the money deposited with Delta index and possibly more. "This is not a game for amateur investors," says Mr O'Neill. "Spread betting can allow you to win unlimited amounts of money but you can also lose very quickly."

Financial spread betting started out as an outlet for City traders with money on their hands and an appetite for risk. However, in recent years, the interest from other areas has grown. "The experience in Britain is that more than 80 per cent of the business now comes from people outside the traditional City desks," he says.

Despite its connection with financial markets, spread betting is not regulated by the Central Bank or the soon-to-emerge Irish Financial Services Regulatory Authority. It is treated as a financial bookmaker and subject to the same guidelines as more traditional counterparts like Paddy Power and Ladbrokes.

One advantage for Irish investors is that they will avoid the currency exchange risk involved in dealing with British spread betting operations that have, until now, dominated the Irish market.