Can someone help please? - Plus500

[Davydenko33]

Hi,
Apologies in advance for asking novicey questions but seeking some advice please.

This morning on Plus 500, I set a buy on the Call of Gold. I had a starting position of 53.31 with the pricing staying in and around that area for most of the trade. Suddenly out of nowhere the spread between "Sell" and "Buy" was in excess of 65 - (a sell of 25.15 and a buy of 90.75) - see image below. A margin call was immediately actioned and my account balance was taken. I imagine this would have happened to many buyers and sellers given the huge spread suddenly given.

Sure enough, almost instantly the market immediately came back to the same level of around 51 and the same tight spread/ However, a margin call was made without any notification and all funds were taken. Is there anything I can do to challenge this with Plus500 as it appears totally unjust to swallow all funds and close a trade by suddenly implementing of spread of 65 between buy and sell. I am even wondering if it was just a mistake, the margin typically on that market is less than 1.

Any advice or explanation much appreciated.

Thanks

Jon

 

[Inquisitor]

Plus500 state on their site that:

Plus500 is mainly compensated for its services through the Bid/Ask spread.

It is very much in their interest to widen the Bid/Ask spread as that makes them a lot of money very quickly. As they are essentially a "Bucketshop" and not a Direct Market Access (DMA) broker then expect this to happen a lot. The only way to avoid this kind of issue is not to use them. It is probably in their T&Cs that they have the right to widen spreads at any given time to any level they see fit.

 

[Davydenko33]

Plus500 state on their site that:


It is very much in their interest to widen the Bid/Ask spread as that makes them a lot of money very quickly. As they are essentially a "Bucketshop" and not a Direct Market Access (DMA) broker then expect this to happen a lot. The only way to avoid this kind of issue is not to use them. It is probably in their T&Cs that they have the right to widen spreads at any given time to any level they see fit.

Hi Inquisitor,
Thank you for taking the time to reply to me. I must admit I feel like I have been duped, but part of that is my own fault for naivety so I feel like a bit of a dummy. I'm from a sports betting background and some sports spread betting in the past. Never seen the like of this though, I obviously chose a bad broker/
Do you think I have any leg to stand on in terms of challenging this given the ridiculously big spread leading to the margin call (typically had been about 0.8 between Buy and Sell then jumped to 65?!).

 

[Inquisitor]

You would be wise to carefully read their T&Cs and see if they have stated that they have the right to do what they did.