FTSE100 index : gaps,slippage and guaranteed stops.

bangkoker

Well-known member
314 17
Hello All, :D

If anyone has a moment (and some knowledge on this matter would love to hear from you).

OK, I am looking at guaranteed stops to prevent gapping but of course with all things in life there is a cost (obviously), I heard Gekko have free guaranteed stops but as just said, no such thing as a free lunch and their spread is wider at 3pts, which pretty much ties in with the spread that would be payable if electing to pay for a guaranteed stop with the likes of IG or CMC :confused: Anyway it also appears that with a guaranteed stop on the FTSE, you have to set it 30pts away from the market (a wider stop than I would be looking to use).

It isn't really a question, as such. Just looking to start a discussion on price gaps in the ftse. I am more specifically talking about during market hours (8-16:30) but also the overnight (futures) market.

I presume that when SB firms price their guaranteed stops, like any commercial venture they are factoring in the real cost (the same as any insurance) and presumably with a 30pt stop and an extra 2 pts spread they feel the balance is about right.

So if there is any gapping in the day market of the FTSE100 index (not necessarily on the underlying market but on the market with the likes of IG) how much slippage have people had on the FTSE100? I realise that there is more likely to be larger slippage around big news (mostly scheduled), so guaranteed stops could be applied then.

BUT of course there are some time odd events, I seem to recollect a couple of times over the last few yrs where the markets has moved very violently and I think that was mostly due to strange events like a large institutional trader putting on a trade with an extra couple of Noughts in the order. :rolleyes:

Anyway has any had any experience of large slippage in or out of market hours or does anyone know where such data may be available.

I hope somebody joins in.

kind regards,

Ben
 
 
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