IG Index dispute - advice welcome!

[dowsp]

I am not sure about having placed say prior buy / sell orders..in extreme market declines or volitility..

I cant recall what IG did on Aug 24th 2015..
but I do recall City Index / finspreads Spread bet company making things for wall street options as Phone only on at least their daily options and maybe their monthly ones...

and yes it could had been very difficult to get thru to them..

I recall watching the market ,if I recall bottom at about 14.30 hrs Monday 24th August 15 and not seeing the Wall street option prices listed...and I did call by phone to ask ...and initially got thru to them...I enquired over where they going to put the options online as they did not show up at 14.30 hrs....and was told Id need to do place trades by phone..and they were not going to offer daily options..and I don't think they had placed the actual monthly options as they had no idea what their values were due to the severe volitility....so they were delayed in quoting any...and I don't think I even new the real value of the put options that I held..

It was a case of wait or call back later..

it was as if to suggest call back in a few minutes as we need time for things to settle and sort things out...

(should NOT be an excuse for the likes of their customers in such cases)

im not even sure at the time if the Index itself was tradable..online..
it may had greyed out also as you describe on the buy / sell button..

After the disappointment of not having been able to close out or place a option trade (To buy call options to hedge my put options at that time) I put the phone down ... then considered something else..(MAYBE TO CLOSE MY PUT OPTIONS or to hedge by Futures).and tried to call again in minutes after while the market made a bottom and the Dow rallied 800 points in about 8 minutes....and my profits on my existing longer term puts disappeared !

I was then unable to get thru to them...in any time that I had needed to do at that period..ie within say 10 minutes..or maybe more..

Overall it seemed an utter nightmare and a disgrace that their system was not upto dealing with the situation..

it seems its not !

IGs platform handles it better but I cannot recall what IG did or if I had many option postions with them at the time as I was involved trying to deal with City Index / Finspreads..

I think even IG maybe also had not quoted correctly or had said it was phone only....

The thing is both IG and CI/ FS... only quote main monthly options from Monday at 14.30 hrs......or that is what they usually will tell you...

and if there is a Holiday on a Monday they then claim to only show them at 14.30 hrs next day Tuesday for eg.

but IG sometimes will quote monthly options before 14.30 hrs..after a Holiday on the Tuesday..maybe from 8 am..as they often will be placing their daily options earlier on than they do the monthlys only they may tell you officially its all done from 14.30 hrs even the dailys..after any weekend or holiday..

They show the daily option prices for the next day after the prior days market closed.. (that is at 21.15 hrs in the UK) they then show the next days options from 21.40 hrs..that same day prior...

if it had been another day of the week that the incident occurred.....Tuesday to Friday..option prices may have been more available and accurate..to have bought or sold at the bottom of such a large decline..

IGs options stay live all week after Monday 14.30 hrs....But close on the Friday / weekend until Monday at 14.30 hrs.. so any major market moves say from SUNDAY Open at 23.00 hrs UK time.. then they do not offer any option prices on the Indexes..until 14.30 hrs.. so the market could fall 1000 points or what ever from Fridays close.then from the open Sunday night to 14.30 hrs Monday..for 15 1/2 hrs....

and any put option valued at the close of the prior Friday on a huge decline from Sunday night would see the option values severely change..and its VERY hard for them to have the correct pricing even come 14.30 hrs Monday... as it may take a while for the real exchanges to get a accurate value...sometimes I think it can take some minutes for them to get the values worked out..

That is the MAJOR PROBLEM with spread bet companies in times of extreme moves.. especially if the big boys decide to reverse the market right on the open..

Its almost impossible to react fast enough and think what to do in 8 minutes..both for us and them...

if you held several option positions in both IG / CI which ones do you close out..in such a situation..if the platform is down ...and you even mange to get thru by phone..

when I got thru to CI they were in panic mode..and they don't do as they should / could.. they will also only want to deal with the big boys positions who hold loads of options..

but when you query things with them later .. they say well you should have asked to do that at the time....(where they had even said we are only dealing with the big boys right now as good as..) that they may deny !!!

but it is understandable that they will give priority to their richer bigger clients..

I would like to hear from anyone who suffered when NYSE invoked 'limitdown' on 24th August 2015 and some SB companies rejected the 'buy' orders online while they accepted these via phone calls. Some firms showed market closure by greying out the line or even showing LD symbol where some others did nothing to indicate the market closure and re-activation. Phone calls were not being responded to in time due to heavy call volumes.

 

[dannyb2017]

This worries me as I spread bet through IG and I'm up by nearly a thousand

 

[dowsp]

What positions are you holding ? long or short positions or call or put options..?

At the moment the market conditions are not like they were last year...

I think the US stock Markets may have just topped and maybe soon to decline..if the recent high tops hold...

if the markets crash.. you then have to have some idea where and when to and have some levels or dates in mind as to when to close out your positions.

if you get caught in a similar situation as last August...which is whats known as a spike low... you have to be able to try to calculate with some high degree of accurracy in such situations to be able to take more maximum profits... otherwise just look for a level to sell that you believe is a safer bet..

 

[dannyb2017]

@ dowsp

I'm in and out usually withing a day or too, mainly long positions but a few shorts, I don't really like shorts as I always worry the price won't drop to that level again.

It's early days but it looks like I can make a regular addition income from this

 

[Hoggums]

As long as you are not scalping or taking advantage of price lag there should be no issues. I've been trading with them for 10 years with no problems and up a five figure sum with them so far this year. It's in their interest to keep the winners as I am paying constant spread to them. Just make sure you make it easy for them to hedge your positions and you'll have no worries.

 

[dowsp]

Dannyb,

That's a good start if your up a Grand and new to this...and been in and out a few times.
Not sure how long for..

Hope you can maintain it..

But The US markets have been range bound for 1 to 2 months...

That also a nice return in the year so far Hoggums..

Do you have any thoughts what maybe likely to happen in the near future...

Do you see a reversal or continuation of the rally ?

any further advice Im sure would be welcome !

 

[dannyb2017]

I'm up £2500 in a mix of real shares and spread betting, could have been more but I'm taking profit instead of taking bigger risks.

I'm really enjoying it, I'm actually quite excited for the open at 8am

I wonder how many people make a decent living doing this full time

 

[dannyb2017]

As long as you are not scalping or taking advantage of price lag there should be no issues. I've been trading with them for 10 years with no problems and up a five figure sum with them so far this year. It's in their interest to keep the winners as I am paying constant spread to them. Just make sure you make it easy for them to hedge your positions and you'll have no worries.

Thanks for the advice, what do you mean about making it easy for them to hedge my positions ?

Cheers
Danny

 

[timsk]

Thanks for the advice, what do you mean about making it easy for them to hedge my positions ?

Hi Danny,
Unless you are trading in any real size, i.e. at least £20.00 per point and probably more like £50.00 p/p (or more) and you are taking positions in instruments that are thinly traded - you needn't be overly concerned by this. If you're trading major forex pairs, equity indices and commodities like oil and gold etc. in modest size (i.e. under £50.00), then IG's algorithms will work out their net exposure and hedge accordingly in the underlying market. What they may take exception to is a customer who attempts to scalp in large size instruments that aren't so heavily traded. This doesn't allow their individual dealers enough time to look at what you're doing, assess the risk to IG and then hedge their exposure if necessary.

I've not explained all that very well and may not have the details quite right, but in essence I think that's what Hoggums is referring to.
Tim.

 

[dannyb2017]

Hi Tim,

Thanks for the reply, I think I understand.

I'm not scalping, i only do that with real shares through HL. I'm usually opening long positions for £50 pp or £100 pp and closing the same day or a couple of days later.

Cheers
Danny

 

[james1145]

IG Index

I had a September DOW futures closed on expiry by IG at a significantly higher than the market price.

Can I just check with other members, what price were they closed at by different SpreadBetting companies on DOW Sep Futures by:

company/short of long position/price closed at.

I would be very keen to take this up further if others have had similar deals.
Thanks

 

[james1145]

Hi,

I was a member some years ago, but I lost my log in details.
So This is my 1st post since then after rejoining.

I tried to do a search for disputes with spread bet companies. but I could not get anything to come
up under the title I searched for. ie "Spread bet company disputes". It maybe that I have not entered the details/ or worded the details correctly in the right way to obtain the results that I am searching for.

I just noticed however & just come across this thread with ref to disputes with a spread bet company.
but I can see that it has not been too active since 2011..and only the last two posts just having been made in August 2015.

I just wondered if anyone knows if there is any way to make a dispute against a Spread bet company if you disagree with their responses..(I prefer not to mention the particular company at this point..but it could also apply similarly to IG as in the past I have had some similar issues with them)

Two or three egs of recent issues that I have had...

When the market crashed on Aug 24th... their system went off line at CRITICAL Moment when the market bottomed...Phoning was out of the question when the market moved up 800 points in a few minutes... the question may be SHOULD their online system be able to handle such Market crashes.. How often I see their platforms fail at vital moments at volitile times.
This stopped anyone closing out positions or buying in at the bottom of the market..

Another issue... I attempted to sell the Wall street market at this weeks top...on the Sunday evening open...in the very first few seconds...23.00 hrs... The platform failed to show their charts price action.. but the price data on the buy and sell buttons did not appear to be altering too wildly in the opening seconds.... I tried to place 3 sell trades in the 1st minutes..

The system did not accept the trades. and I did not get filed.... after a couple of minutes the market had moved to far down for me to want to retry another entry to sell.

I called to complain. and they confirmed that I had attempted the trades..and the system did not accept them for some reason.. and they could not answer why the chart service was not showing the visual price bars. which I needed at this vital time to see what was actually happening.
This was a critical time to enter and no I did not want to be on the phone... I just wanted a system that worked when it should do..... I dont mind technical issues as long as they acknowledge and agree to accept a trade when I call to dispute ,as long as they show or have the evidence of my attempted trades..which they had.

BUT even then... they said I then had to send an email to dispute this.. and it could take upto 2 days. Meanwhile the market fell 500 points... I told them in an email I wanted to take some profit at a level reached to try to cover myself if the market recovered... and gain some profit if they would honor it.

Another issue I had ..with this comany and IG was On the 25th I had bought some Wall st ? Dow Sept 17000 and weekly call options...and the market rallied over 500 points in 2 days..
I expected a reasonable gain of at least to double my money ...

to my dismay.. these options had hardly gained at all...and made just about 50% on what Id paid.
Many a time in the past Id easily doubled my money on a 500 point move..

Yet this was during the what seemed very volitile period over a few days and they were offering very little gain on these call options.

upon querying this.. they said sometimes option volitily is what determines an options value.
and in this case this is one of those instances.and they were not valuing call options very favourably.. I suspect that
still had a bearish sentiment...but the increaes in value of the call options seemed VERY undervalued after seeing such huge market moves..

I felt rather cheated and I had this happen in the 2007 to 2009 crash..where I was overpaying for options .. seeing HUGE moves and then getting little gains... basically they can alter the Vol so much that when a market has rallied say in a few hours to a day..then they devalue the volitility..
and the value of those options show NO gain..

As this very rarely happens.. its very hard to really know the realities of what such options may be worth under such conditions.. they could be telling me anything... or maybe the market makers are just creating unrealistic valuations.

I feel I need a real expert to be able to investigate this for me..and wondered if one had such querys is there any sort of service or company/organisation that could investigate such complex issues..

also so many times have I seen my account values when holding options just litterlly disappear.. on what seem rather small moves in the market of a couple of days..and when the market comes back to simlar levels.. the values of the account has halved.

to me its all so easy for them to get away with it.. and I don't believe that are valuing these options correctly.. in such times they can make any excuse.

They also have been making huge wide spreads on the options.buy and sell prices. as much as 4 to 5 time more..on daily options and 2 or 3 times on monthly Sept options...

Yes the market has had days of huge moves.. but some days in between were more normal yet they still had such wide spreads...and well over priced options..

As I am not a trader with an account to sell options and take any advantage of that.. which is still high risk...and I think few people in spread bet companies would look to do... I think it seems rather manipulated and more or less makes it very unappealing to want to risk trading with them when they are so overpriced..

Relating to the incident you refer to there was a change made by NYSE about a year prior to this incident which instructed companies on using 'limit up' and 'limit down' - so when the market is 'limit down' they should allow/accept buy orders
but not sell orders and vice versa. However, IG had made no effort to incorporate this in their platform hence the problem.

 

[james1145]

I had a DOW September 'short' position closed on expiry by IG at a significantly higher than the market price.

Can I just check with other members if they have had their Sep Dow positions closed by their spreadbetting company by:

SB company/short or long position/price closed at

I feel there may be a case here of taking further action with the appropriate authorities.
by

 

[tomorton]

I wasn't in a Dow trade recently but if you want to give the time and price I can check on my SB firm's chart to see if they tally with IG.

Have you checked the underlying market chart?

 

[mpups]

I'm usually opening long positions for £50 pp or £100 pp and closing the same day or a couple of days later.

Cheers
Danny

i wonder if six-weeks-experience dannyb had one too many £50pp to £100pp losses and that's why he went quiet soon after
:whistling

 

[EnlightenedJoe]

i wonder if six-weeks-experience dannyb had one too many £50pp to £100pp losses and that's why he went quiet soon after
:whistling

No, he won and bought an island. Internet is not yet installed there. To build a satellite station or lay under-sea cables takes 100's millions if not more. A few 10's millions win won't cover it.

 

[dannyb2017]

i wonder if six-weeks-experience dannyb had one too many £50pp to £100pp losses and that's why he went quiet soon after
:whistling

He's gone nowhere !!! Made a packet but lost a bit by not sticking to stop loss on itv. I'm well under but sitting it out. Also being very busy with work so not had as much time to trade

 

[mpups]

He's gone nowhere !!! Made a packet but lost a bit by not sticking to stop loss on itv. I'm well under but sitting it out. Also being very busy with work so not had as much time to trade

oh yeah i see it went down about 25% soon after your last post, nightmare! but doesn't sound too bad overall then.

thanks for coming back with the update

what does "im well under but sitting it out" mean?

 

[dannyb2017]

Got £85pp average at 197, share price is currently 158, I'm about 3 grand down on my spreadbet position. It will recover as it's almost at the floor, so il hold the position until it recovers above £2

 

[mpups]

Got £85pp average at 197, share price is currently 158, I'm about 3 grand down on my spreadbet position. It will recover as it's almost at the floor, so il hold the position until it recovers above £2

ok plus the financing charges?

you had the first 4 months or so of this year to get out at breakeven or small profit!!