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why should you have to cross bid offer spread twice ??


Guest london

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Guest london

why should you have to cross the ig bid offer spread twice on each trade ??

 

ig should get its spread on the first leg and then try to let you exit that trade at the best possible price 

 

so bid offer shown will be different to the price that you can exit a trade at 

 

and you cant add extra to the trade at that price  ie u can buy 1 and sell more than 1 at the better price 

 

obviously this would hurt ig bottom line short term but i would trade alot more if spreads were tighter and i didnt feel IG was taking out as much cash on each trade as possible

 

thus ig would make alot more money out of me long term if i felt ig actually tried or cared about making my trading a success

 

this meausre would also indicate to the FCA that IG takes customer care properly

 

at the moment IG considers itself better than the rest but it really is just a churn and burn merchant

 

 

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Hi , thanks for the post.

 

Firstly, I just want to clarify that we're in no way a 'churn and burn' merchant, and as an FCA-regulated firm we can only offer products and services providing best execution to clients, so it is in our best interests to continue doing so and encouraging active traders!

 

We do, of course, aim to make revenue, and one of the ways we do this is by charging a spread or commission on our trades.

 

The spread is added around the mid-price of the underlying market as relevant, so we add to both the 'ask' and 'bid' prices to widen the quoted level.  When you open a position, you are charged the full spread because the open position will immediately look at the opposite price level to calculate the P&L.  This means if you open a long position, the 'latest' level on the platform will show the sell or bid price as this is the price you will trade at to close.  Therefore, the full spread is shown in your running P&L straight away, and you do not pay extra spread upon closing.

 

As I mentioned, it's in our best interests to offer attractive spreads so that more clients look to trade on our prices, so we will offer the tightest spreads we see possible.

 

I hope this clarifies things around our spreads.  It would be good to hear any other comments or feedback from anyone else on this as always!

 

Thanks,

Hannah

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Guest london

hello Hannah

 

ig makes a spread around a spread 

 

that spread is at ig's discretion .. they become very hazy at opening of markets and just before closes and seem to be much wider which just happens to trigger stops .. which the IG traders can see ... 

 

if u r long and want to sell out you have to cross the bid offer spread and then the ig bid spread 

 

ig could assist its CUSTOMERS by assisting in the exit of trades at the more economic level as possible

 

full one side spread (not double) on entry ... very little spread on exit 

 

this would of course differentiate IG and bring in more custom and more revenue 

 

upto IG if it wants to have clients cross wide bid offers and get tired and resentful of it or if it attempts to see a smarter way 

 

your message misses the point

 

ig should show different prices to exist trade in your open positions  to prices in your watch list

 

why not be open about your spreads ...  

 

no one argues about ig making a spread as it is their business  

 

 

and dont even get me started on your funding spread .. just pay pay pay , ridiculous during period of low interest rates

 

so it isnt just the bid offer where IG makes its money ... 

 

until that changes  churn and burn is the business model sorry 

 

IG is not offering best execution possible to clients as there is no transparency to spreads and no attempt to assist exit of assisting trades

 

i dont not believe markets are made around mid market .. i have watched live underlying markets and prices are skewed by IG one way or the other or spreads widened 

 

clearest way is to show market live bid offer and ig spread ... then no arguments

 

i suggest this would be a measure that the FCA would approve of

 

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Hi , thanks for getting back to me.  I'll try and address all your points and hopefully give some more clarity regarding our spreads.

 

Firstly, we do always try to be as transparent as possible - and this in itself is of course a regulatory requirement - by publishing our spreads on our main website (www.ig.com).  For example, you can see our full spread details for indices here, and would be able to navigate to the same information for our other markets.

 

Whilst the spread is indeed at our discretion, and we will advertise it as variable because of this, we try to keep it as constant and tight as possible as this is in the clients' best interests, and happy clients are what we are aiming for.  The reason our spread will sometimes change is because we offer markets out-of-hours, when the underlying market is closed, so the pricing model is different and we would have less liquidity available.

 

Stops and limits are triggered basis our spread - so for example if you are long you would be closed basis the bid price, and vice versa - but we would not widen the spread to 'catch' stops; again this would breach our FCA regulations and is not at all what we are interested in.

 

To confirm, you essentially pay full spread upon opening as your running P&L will reflect the full difference between our bid and offer at the time.

 

Could you clarify what you mean by 'funding spread' so I can answer that question?

 

I hope this helps, please let the Community know any more questions you have.

 

Thanks,

Hannah

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Guest anders

The spread is there for all to see, it's the difference between the buy price and the sell price. When buying shares through a non-spreadbet account, we all still pay spread as there is always a difference between the buy and sell price. Similarly, in a non-spreadbet account, the spread widens when the market is closed.

 

IG make their money by reducing the sell price a little, and upping the buy price, i.e. they increase the spread. , your suggestion seems to be IG only increase the buy price OR only decrease the sell price?

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  • 3 weeks later...
Guest london

what i am suggesting is that the exit price for a trade you have on should be better than the standard bid offer for a new trade 

 

re funding spread .. you pay to borrow money and earn nothing on money you effectively lend to iG

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