New: Knock-outs

[LeoTrader]

Hi, 

It's great to see this new way to trade (bet on) the markets with reduced margin (akin to pre-ESMA leverage restrictions). I'm sure many will find this a useful feature, however, as an intraday trader, my stops are significantly closer to my entry price than the knock-out levels available. Take EUR/USD for example; a typical stop for me would be 10-15 points, whereas the closest knock-out level available is over 120 points away. So I wouldn't be able to take advantage of them without taking on unacceptable risk with a considerably negative risk-reward ratio.

Are there any plans for closer knock-out levels suitable for intraday positions? Ideally in increments of 1 instead of 10, or even user-defined levels. 

[phillo]

"Knock-outs"  ???    where , please tell me, are they ?

[Caseynotes]

On the new platform under fx on the left hand side bar.

[phillo]

Thank you

[Guest PandaFace]

FTSE 100 Bull KO 

market moves a point you make or lose a point. So basically what we had before...right? 

Looks like knockout level is basically a guaranteed stop. On that’s FTSE one above min stop level is 80 points away, which on a 7700 market means you getting about 103:1 if I’ve done the math correctly. Which is a margin percentage of 0.97 (basically 100:1 or 1% deposit margin). 

You HAVE to have a guaranteed stop tho which you have to pay for, but given the leverage pay out it seems pretty darn good in this post ESMA world.

[Guest Joe]

What happens with "knock outs" if you lose 50% of your margin, do you close the position??

[phillo]

they look interesting - well done IG - keep this stuff coming

[Guest Joe]

Also - why is the knock-out expiry date not shown on deal ticket prior to placing the trade?

[phillo]

is there an expiry date, or is it just the "knockout" level ?

[Guest Joe]

Yes -  there is an expiry date, and this is not indicated on the deal ticket prior to placing the trade (at least i could'nt see it anywhere).

[Caseynotes]

So the expiry on the Dax is 10 days (look at top left of chart next to chart name). And being a fixed stop the deal ticket will be rejected if you choose too large a bet size for your account size (margin already set).

The info popup after place a trade requires speed reading though if you click on it it will stay up.

[phillo]

[Caseynotes]

They all seem to have a min bet size of £0.50 even Dow.

[phillo]

that dax expiry date is Aug   2019   from what I can see

[Caseynotes]

Yeah, was just looking at your pic, what did you click to bring that up? a year seems somewhat excessive. It also says the min size is 1 but it is 0.5 though that is on demo. 

Forgot to mention the with the Dow at £0.5 min bet size the KO was 270 points. 

 

Edited August 9, 2018 by Caseynotes

[phillo]

excuse the playschool drawing  - arrows show where to click

[Caseynotes]

So far so good on the £10,000 demo ?

[LeoTrader]

The expiry seems to be just under 12 months for all of them (I've not checked them all). Overnight funding applies though, so you wouldn't want to hold one for that long. 

Edited August 9, 2018 by Trader126

[trade247]

wonder if the 'expiry'  (which should probably be put in these " as it's more "expiry") is just a requirement for this to be an option? or a spread bet I don't know. Like the DFB's which have expiry dates of 2029...

[JamesIG]

Hi all - I'm glad you're finding your way around the new product. This went live yesterday on spread betting accounts yesterday around 3pm UK time. This is currently only available to UK spread bet clients. You can find more info reguarding these products here > https://www.ig.com/uk/help-and-support/spread-betting-and-cfds/market-details/what-are-knock-outs 

On 8/9/2018 at 1:08 PM, Guest Joe said:

Yes -  there is an expiry date, and this is not indicated on the deal ticket prior to placing the trade (at least i could'nt see it anywhere).

As shown above expiry dates are shown on the deal ticket here. These are presented in a MONTH-YEAR format so Aug-19 will be 1st August 2019 (not August 19th). You can find out more information via the 'info' section (as discussed above) along with settlement criteria if you hold until the point of expiry as quoted in the deal ticket. 

Any comments, questions, or feedback notes warmly received. 

Best
James

[Caseynotes]

Interesting stats from the demo re margin requirement, account size and the much too big bet size (£50/point).

 

[LeoTrader]

Hi @JamesIG,

Are there any plans for closer knock-out levels with smaller increments, suitable for intraday positions? 

Thanks.

[JamesIG]

2 hours ago, Trader126 said:

.... as an intraday trader, my stops are significantly closer to my entry price than the knock-out levels available. Take EUR/USD for example; a typical stop for me would be 10-15 points, whereas the closest knock-out level available is over 120 points away. So I wouldn't be able to take advantage of them without taking on unacceptable risk with a considerably negative risk-reward ratio.

Are there any plans for closer knock-out levels suitable for intraday positions? Ideally in increments of 1 instead of 10, or even user-defined levels. 

3 minutes ago, Trader126 said:

Are there any plans for closer knock-out levels with smaller increments, suitable for intraday positions? 

Great question @Trader126

I wanted to add that we are looking at introducing a non guaranteed stop option over and above the KO (kick out which is guaranteed) level. In other words, this means you could have a position with a guaranteed KO, and also the option to add a regular stop before the KO. If the market moves against you the regular stop will look to close the position at the best available price, whilst you also have the assurance the KO level will guarantee your downside risk.

There is no set delivery date but we will keep the Community updated. 

[LeoTrader]

@JamesIG, that is good to know, thank you. That would enable far greater control of risk and would be ideal for intraday trading (provided there are no minimum stop distances beyond what you already have on spread bets). I look forward to hearing any updates on a delivery date in the future. ?

[phillo]

done a couple of "demo" trades   - went ok after I worked out how to close them !

[trade247]

9 minutes ago, elle said:

done a couple of "demo" trades   - went ok after I worked out how to close them !

Just like normal no? Or have you not used this new platform yet? Should just go to positions > close and then you get a green confirm. Did it below where I had two positions originally and closed one to test in demo.

 

 

[Guest PandaFace]

Surprised this hasn’t got more tranction. This is literally the solution to the esma stuff and hardly anyone is on it...? 

Odd.

[Caseynotes]

I think the movable 2nd stop proposed feature will make a big difference to the appeal factor. My demo £1,500 profit has turned, overnight, into a £400 loss.

[Guest Ajg]

I guess the new knockouts are a way of helping retail traders... where the margins have gotten way high.

is there anything in them for the professional accounts ?

[Caseynotes]

Interesting question Ajg, presumably there is the tax benefits of an options type instrument on a spread betting platform instead of the CFD platform. And having an adjustable stop feature (proposed) on an options intrument. A professional account wouldn't have the negative equity protection.