" You cannot sell this market to open" ?

[zala]

I've been seeing this whilst trying to go short on certain stocks but I haven't been able to figure out why this message pops up?
It usually happens with stocks that already have a high amount of short-interest on them.

But even if that is the case, why is IG not letting one short these stocks?

[Caseynotes]

17 hours ago, zala said:

I've been seeing this whilst trying to go short on certain stocks but I haven't been able to figure out why this message pops up?
It usually happens with stocks that already have a high amount of short-interest on them.

But even if that is the case, why is IG not letting one short these stocks?

@zala, in order to sell to open you must first be able to borrow the asset. What the 'you cannot sell this market to open' message means is that IG can't find anyone who will allow you to borrow it in the first place.

A similar message you may see is 'this market is unborrowable', meaning there is no liquidity to lend the asset to you for you to open a short (sell) trade.

[zala]

On 10/03/2019 at 15:07, Caseynotes said:

@zala, in order to sell to open you must first be able to borrow the asset. What the 'you cannot sell this market to open' message means is that IG can't find anyone who will allow you to borrow it in the first place.

A similar message you may see is 'this market is unborrowable', meaning there is no liquidity to lend the asset to you for you to open a short (sell) trade.

Yes, I found their excel-spreadsheet marking which stocks are possible to short and those not.
However I still don't get why I sometimes get "order rejected" on stocks that are both longable and shortable.

Any ideas?

[Caseynotes]

@zala,  the spreadsheet only covers stocks that are listed long term as 'no sell to open' but it may also occur suddenly on high one way volatility on any asset for a short duration of say a couple of days right down to just a couple of minutes. 

[Treehouseman]

But if a spread bet doesn't actually require owning the underlying asset that you bet on why is it still not always possible to short sell certain AIM stocks via spread bets? Is the reason simply that unborrowable stocks are too risky to allow spread bets? Thanks to anyone who can shine some light on this! 

[Caseynotes]

7 hours ago, Treehouseman said:

But if a spread bet doesn't actually require owning the underlying asset that you bet on why is it still not always possible to short sell certain AIM stocks via spread bets? Is the reason simply that unborrowable stocks are too risky to allow spread bets? Thanks to anyone who can shine some light on this! 

Hi, because a cfd is still a contract and to trade it IG need to find you a counter party, to short it IG first need to find someone to lend it to you and then find you a counter party to trade with. If no one is willing to lend it to you in order for you to short it (sell it) it is said to be unborrowable.

[JamesIG]

10 hours ago, Treehouseman said:

But if a spread bet doesn't actually require owning the underlying asset that you bet on why is it still not always possible to short sell certain AIM stocks via spread bets? Is the reason simply that unborrowable stocks are too risky to allow spread bets? Thanks to anyone who can shine some light on this! 

At it's most basic level (with a caveat that this is an indicator for educational purposes and there are more complexities such as internal risk limits etc) if you were to short £1/pt of a UK listed company, and you were the only one who was looking to short that company on the IG platform, IG would look to go to market to short 100 shares in that company and hedge your position. 

IG offer you the opportunity to not own the underlying shares, however we do not bet against you and therefore would hedge your trade in the underlying market. 

[Guest numbers]

On 14/08/2019 at 09:46, JamesIG said:

At it's most basic level (with a caveat that this is an indicator for educational purposes and there are more complexities such as internal risk limits etc) if you were to short £1/pt of a UK listed company, and you were the only one who was looking to short that company on the IG platform, IG would look to go to market to short 100 shares in that company and hedge your position. 

IG offer you the opportunity to not own the underlying shares, however we do not bet against you and therefore would hedge your trade in the underlying market. 

Hi James

If I am shorting a stock and you short the company too, doesn't this only hedge you against my position in one direction?

does this mean that if I'm wrong my position covers your loss against the hedge you placed and if I'm right then you're not out of pocket as you're right too, so your position covers mine?

[Guest phil]

16 hours ago, Guest numbers said:

Hi James

If I am shorting a stock and you short the company too, doesn't this only hedge you against my position in one direction?

does this mean that if I'm wrong my position covers your loss against the hedge you placed and if I'm right then you're not out of pocket as you're right too, so your position covers mine?

yes. The contract you take is with IG, so the point here is if you win then IG owe you that money, so they buy your exact trade / shares from the LSE or whatever exchange so the result is they are neutral and don't care where market goes. Same if it goes down, you lose money to them, but they have lost it to market so neutral.

IG make the money from spread and those overnight fees.

[Guest aRandomTrader]

This is convoluted but you could open a short trade at end of day...  Then next day if you want to take short position you leave trade open. If want long position open trade in opposite direction with double the quantity. And close the short asap when market opens. Obviously you'll get charged overnight fees plus need much more $$ in account... Haven't thought all the pros and cons completely but it could work.