Volatility reminder and extended weekend closure
Due to ongoing volatility, there is significant risk that markets may gap when they re-open on Sunday night. Please ensure that you’re comfortable with the size of your positions heading into the weekend, and also be aware that we may see circuit-breakers applied over the coming days – see below.
We urge you to do the following:
• Monitor your positions closely at all times
• Ensure you are comfortable with the size of your positions, and the effect that any market gap may have on them
• Ensure you have sufficient funds on your account to cover your positions in the event of a significant market move
You can also use our weekend markets to hedge against risk on your weekday positions.
Please note, however, that there will be a delayed open on our cryptocurrency and weekend markets on Saturday 14 March, to allow for scheduled maintenance which should improve platform stability. These markets are planned to reopen at 8am (UK time), rather than the normal 4am. We’re sorry if this causes you any inconvenience.
Circuit-breakers may affect your trades
At times of high volatility, regulated central exchanges may suspend trading on one side of the underlying market (an event known as a circuit-breaker). This happened to the Dow Jones Industrial Average this week, for example. IG follows suit whenever a circuit-breaker occurs.
Circuit-breakers aim to restrict trading in order to avert market crashes or spikes. The restrictions are called ‘up limits’ or ‘down limits’, depending on the direction that the market has moved. As trading is suspended in the underlying market, it will impact how you trade with us.
• An up limit is the maximum amount that the price of a stock index or commodity futures contract will be allowed to increase in a single trading session. If hit, it means that buying will be suspended in the underlying market.
• A down limit is the opposite to an up limit – it sets the maximum amount that the price of a stock index or commodity futures contract will be allowed to decrease in a single trading session. If breached, it means that selling will be suspended in the underlying market.
If you want more information on up limit and down limit you can find that here: https://www.ig.com/uk/glossary-trading-terms/limit-up--limit-down-definition
At IG, when a down limit has occurred, you will only be able to buy – whether to open or close a position – through phone dealing. However, please be aware that the price may be significantly lower when the market re-opens.