8 pips spread on EURGBP by IG

[Guest TEO88]

On 28/5/2019, 1700 GMT,  IG Market EURGBP spread was EIGHT pips.  How ridiculous !!

Mid point was 0.88335, ask 0.88375, bid 0.88295,  they took out my stop at 0.8837!!

This is equivalent to quoting 6 pips spread on EURUSD, and 6 pips spread on GBPUSD.

The next price is 0.88345 on bid.  So they blipped the price to take stops. How unprofessional and dirty works.

They claimed that it was liquidity provider's fault due to holidays in US. 

I HAVE NEVER SEEN SYDNEY MARKET QUOTING 8 PIPS spread, even in a thin market.

Is there any authority watching them?

 

[Guest backwardation]

- Labor Day in US
- Bank Holiday in UK
- Sydney session 

I'd give each of those reasons around 1.5pip each.

[Guest PandaFace]

You an authority on fx liquidity and can see all the OTC quotes the LPs are spitting out or just a regular fella sat at home trading on their laptop? 

Like backwardation said US and UK closed, so aaaaall USD and GBP is locked up, plus Australian session so **** is thin. 

IG is regulated by FCA and ASIC in aus if that’s where you’re based. What do you think is the benefit of ‘stop hunting’ to take you out of your £1 a point or other tiny position? 

Paranoia is real. Why don’t you just trade FX DMA then you cut out IG as an intermediatry as well as your deamons... 

[JamesIG]

Hey folks. 

I believe you may be referring to 5.00am GMT rather than 17.00pm GMT today (the 28th)? Whilst I understand the frustration of having a position closed out, especially at times of thin liquidity or heightened volatility which causes spreads to widen, I wanted to reassure you that IG prices are reflective of the underlying FX market at the time. Client satisfaction is an absolute priority, and we understand the competitive nature of our niche trading offering. 

I believe an important factor in IG's success over the years is a commitment to work closely with regulators and appropriate governing bodies. As noted we're regulated by the FCA in the UK and ASIC in Australia. Other office locations are regulated by the appropriate authorities. 

Unlike shares or futures trading, FX doesn’t trade on a centralised exchange in the same way, so we need to shop around for over the counter liquidity providers such as international banks and financial institutions. To do this, we collate several feeds from some of the largest providers and use a smart order router to push you the best bid/offer spread to trade. Whilst IG spread around this is variable, it's based on movements in the underlying.  

Most importantly, we never take a speculative view on the direction of the market. While it is a well-known fact that successful trading can be challenging, we do not typically benefit from trading losses that an unsuccessful client may experience. In the same vein, if you make money from a profitable trade, IG does not typically lose out.

Put simply, we want our clients to trade profitably, and we put client interests at the heart of our business. Revenue is generated from spreads and administrative costs, and in some jurisdictions separate commission. It therefore goes without saying that we do not manipulate price feeds, hunt stop losses etc.

The below video may be of interest, with insight into FX pricing starting around the 2 minute mark. If at any point you wanted to question or check our prices, please feel free to give us a call and we can look into your query in real time. 

 

[Guest PandaFace]

With that said... it would be cool to have bidoffer spread displayed on the chart MT4 style, even if that’s only on tick/second/minute and when on line chart.

[Guest TEO88]

It is not about money, I only lost 300 usd on a 2 std lot trade.  It all boils down to standards adopted by platform. You cannot quote 0.9 pips and suddenly 8 pips spread, 9 times wider.  Even in times of adverse market condition, there must be a band on the spread. Not 9 pips, or even 15 pips as and when they subjectively deemed fit!   At that point in time the  asking price of EUR divided by bid price of GBP is only 3 pips spread at the maximum. EURGBP is not a standalone ccy, it is a cross ccy.

[Guest AG 804.]

 FWIW, I have been trading FX for over 40 years, both as a pro, and as an individual. Even as late as 2000, banks were still quoting each other anything from 5 to 10 ticks in $5m in $/DM, then the most widely traded currency pair. That one can deal in the same amount (or more) for less than one tick most of the time still amazes me. There are several reasons for this, but the Rise of the Machines is one of them.  but when the machines go mad (january2019 in JPY),  there is downside as well. 

 I know it sucks when you're stopped by a pip or so, but it's part of the game. Deal with it. If you want to blame someone else, you are deluding yourself.  For my part, day trading is too hard these days, and trying to run the trend is the only way to go.

[JamesIG]

21 hours ago, PandaFace said:

With that said... it would be cool to have bidoffer spread displayed on the chart MT4 style, even if that’s only on tick/second/minute and when on line chart.

I'll make sure to pass that on - would be useful for sure and help resolve the bid/offer spread questions and help people see their stops/limits being triggered 

[dmedin]

James, is it true that there are two 'books' of clients, the successful ones (A book) and the losers (B book)?  I read that in an FX book by Anna Coulling.  I find the idea quite amusing.

[JamesIG]

4 hours ago, dmedin said:

James, is it true that there are two 'books' of clients, the successful ones (A book) and the losers (B book)?  I read that in an FX book by Anna Coulling.  I find the idea quite amusing.

We aggregate client exposure, internalise flow as efficiently as possible, and hedge any exposure which goes outside of these parameters. We don't trade against our client base, we don't have an opinion of market movements or direction, and our focus is to execute trades basis the best prices in the underlying market. 

In some instances, for example high volume trades or trades of significant size, we'll have to go to market immediately as these go outside our risk parameters - i.e. passed to market outside of our OTC retail aggregation. 

However, we also offer the FX DMA option for clients who want all their trades pushed to market directly - so called "A book". https://www.ig.com/uk/forex/forex-direct