IG Index dispute - advice welcome!
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A Dashing Blade
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defender110
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I'm now in overall profit, although it's in the 100's not 1000's. I suppose they we're egar to allow me to continue trading in the hope I loose this back.
I was reading an article on this site that apparently over 90% traders loose money via SB. I do not know if this is true but it would explain why IG index is currently valued at 1.7 billion - and that's sterling!
I hope to continue trading the news when events occur, appears to me the safest way to make money. I would have been laughing if they hadn't blocked me from selling my stock (by not answering the phone!), would have been quids in but their big and i'm small - and there's nothing I can do about it 🙁
arabianights
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(p.s. I just noticed your note - they still make the defender!)
Gordon Gekko
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stevespray
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I disagree - When you trade with a spreadbetting firm you are trading against their price in their market. A firm may well suspend their market if the underlying becomes unavailable. However, this is not the only reason which a firm may use to suspend it's market. The various reasons are listed in the Client Agreement. In this particular case I'd agree with the earlier poster - the market was clearly suspended and this suspension went beyond a suspension of internet trading (phone only) as the firm stated to the client that it would not be possible to add / modify / open / close orders even via the telephone... In other words there was absolutely no access to the firms market by any method.
stevespray
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My reading of the firm's T&Cs is slightly different.
If you read them carefully you'll see that the word "may" is used quite a lot. In other words, in plain English, the firm are never obligated to take any of the actions or entitlements which it lists in those particular terms. Instead they can decide if they wish to invoke a particular term. On that basis you wouldn't be able to claim that the firm should have done x,y or z because the firm could simply defend itself by saying that on the particular occasion in question they decided not to invoke that term. On that basis there appears no obligation for the firm to either "void trades" or "close the bet at current values" although the firm have that option if they wish to exercise it.
tar
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They didnt say he couldnt close his trade by the phone , he cant add/modify , but he can close his trade ofcourse , my point was this is not the suspension that requires IG to void bets or close them at the current price :
" ... . We also reserve the right to Suspend a specific
Bet that you have open with us. If we Suspend a Bet, it means that: you will generally
not be permitted to increase your exposure to us under the Suspended Bet, but
you will be permitted to close, part close or reduce your exposure to us under the
Suspended Bet; in relation to the Suspended Bet, you will no longer be permitted
to deal with us via our Electronic Betting Service, rather you will be required to deal
with us via the phone ."
stevespray
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They didn't 'suspend his bet'. Instead they suspended their market. A 'bet suspension' is relavent to an individual client. A 'market suspension' is relavent to all clients. This is covered under Section 22 of the Client Agreement titled "Force Majeure Events" which is what firm told the client when he finally contacted them by telephone. Obviously the firm cannot claim a 'force majeure event' against one client whilst allowing other clients to carry on trading the same market - A 'force majeure event' is an event which effects a particular market and not an event which effects an individual client.
Whilst I understand the point which you're raising, it isn't actually relavent to this particular situation. If you read post #10 then you'll see that the firm advised the client that they wouldn't have been able to deal (or alter stops etc) even if he had managed to get through. This is because it was the market that was suspended, not the client. If, as you set out, it was purely the client then he would have been allowed to close his positon or insert stop loss via the phone.
tar
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"
22. Force Majeure Events
(1) We may, in our reasonable opinion, determine that an emergency or an
exceptional market condition exists (a “Force Majeure Event”), in which case we
will, in due course, inform the FSA and take reasonable steps to inform you. A Force
Majeure Event will include, but is not limited to, the following:
(a) any act, event or occurrence (including, without limitation, any strike, riot or
civil commotion, act of terrorism, war, industrial action, acts and regulations of
any governmental or supra national bodies or authorities) that, in our opinion,
prevents us from maintaining an orderly market in one or more of the Indices in
respect of which we ordinarily accept Bets;
(b) the suspension or closure of any market or the abandonment or failure of any
event upon which we base, or to which we in any way relate, our quote, or the
imposition of limits or special or unusual terms on the trading in any such market
or on any such event; or
(c) the occurrence of an excessive movement in the level of any of our Indices
and/or any corresponding market or our anticipation (acting reasonably) of the
occurrence of such a movement;
(d) any breakdown or failure of transmission, communication or computer
facilities, interruption of power supply, or electronic or communications
equipment failure; or
(e) the failure of any relevant supplier, broker, agent or principal of ours, exchange,
clearing house or regulatory or self-regulatory organisation, for any reason to
perform its obligations.
(2) If we determine that a Force Majeure Event exists we may at our absolute
discretion without notice and at any time take one or more of the following steps:
(a) increase your Deposit or Margin requirements;
(b) close any or all of your open Bets, other than any Controlled Risk Bet, at such
Closing Level as we reasonably believe to be appropriate (and, in the case of a
Controlled Risk Bet, where there is no quotation available, we may close any such
Bet at the time when we reasonably believe that, but for the existence of the
Force Majeure Event, the level set by you for closing the Bet would have been
reached);
(c) suspend or modify the application of any or all of the Terms of this Agreement
to the extent that the Force Majeure Event makes it impossible or impractical for
us to comply with the Term or Terms in question; or
(d) alter the Determination Date for a particular Index. "
anyway he took his money back 🙂
22. Force Majeure Events
(1) We may, in our reasonable opinion, determine that an emergency or an
exceptional market condition exists (a “Force Majeure Event”), in which case we
will, in due course, inform the FSA and take reasonable steps to inform you. A Force
Majeure Event will include, but is not limited to, the following:
(a) any act, event or occurrence (including, without limitation, any strike, riot or
civil commotion, act of terrorism, war, industrial action, acts and regulations of
any governmental or supra national bodies or authorities) that, in our opinion,
prevents us from maintaining an orderly market in one or more of the Indices in
respect of which we ordinarily accept Bets;
(b) the suspension or closure of any market or the abandonment or failure of any
event upon which we base, or to which we in any way relate, our quote, or the
imposition of limits or special or unusual terms on the trading in any such market
or on any such event; or
(c) the occurrence of an excessive movement in the level of any of our Indices
and/or any corresponding market or our anticipation (acting reasonably) of the
occurrence of such a movement;
(d) any breakdown or failure of transmission, communication or computer
facilities, interruption of power supply, or electronic or communications
equipment failure; or
(e) the failure of any relevant supplier, broker, agent or principal of ours, exchange,
clearing house or regulatory or self-regulatory organisation, for any reason to
perform its obligations.
(2) If we determine that a Force Majeure Event exists we may at our absolute
discretion without notice and at any time take one or more of the following steps:
(a) increase your Deposit or Margin requirements;
(b) close any or all of your open Bets, other than any Controlled Risk Bet, at such
Closing Level as we reasonably believe to be appropriate (and, in the case of a
Controlled Risk Bet, where there is no quotation available, we may close any such
Bet at the time when we reasonably believe that, but for the existence of the
Force Majeure Event, the level set by you for closing the Bet would have been
reached);
(c) suspend or modify the application of any or all of the Terms of this Agreement
to the extent that the Force Majeure Event makes it impossible or impractical for
us to comply with the Term or Terms in question; or
(d) alter the Determination Date for a particular Index. "
anyway he took his money back 🙂
stevespray
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Yes, agreed, IG acted very fairly on this one.
I was making my series of points for one reason; that people should be aware of what the T&Cs actually state. If people are planning on trading for the longer term then they should be aware that these kinds of 'black swan events' do occur in the markets from time to time. Over the years I've found quite a few occasions when firms stop following what the client agreements set out when particular situations suit them.
Steve.
I was making my series of points for one reason; that people should be aware of what the T&Cs actually state. If people are planning on trading for the longer term then they should be aware that these kinds of 'black swan events' do occur in the markets from time to time. Over the years I've found quite a few occasions when firms stop following what the client agreements set out when particular situations suit them.
Steve.
tar
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Email from Igindex
I emailed the dealing desk and i asked them about this matter and here is their response , which is more than fair , i didnt know that the futures market wasnt trading at the time ...
"Dear Sir
Thank you for your email. Please let me provide the context to our decision to suspend trading on our Japan 225 (Nikkei) markets last Wednesday evening. Firstly, the most important thing to note is that at the time we were acting as market makers because no futures markets were trading. We were making our price according to the volatility seen in other markets and client business that we were seeing. I am sure that you are already aware, but to expand on this further, USD/JPY had just dropped 3.5% in a matter of minutes. There was also news emerging from Japan that the Government would intervene imminently in order to try and weaken the Yen, and rumours that the Nikkei would not reopen as scheduled.
With all this in mind, we felt we had no option but to stop making a price for the short period until we could establish a firm market price when the underlying futures market opened. I am afraid that during this period we were unable to quote prices either online or over the phone to open new bets or close any that were existing. We resumed quoting as soon as we possibly could, around 30 minutes later.
Please understand that these circumstances were very unusual as market conditions of this nature occur very rarely. I hope the information above clearly explains our decision.
If you have any further queries please do not hesitate to contact me.
Kind regards,
Alex Moore
Dealing Support Desk
"
I emailed the dealing desk and i asked them about this matter and here is their response , which is more than fair , i didnt know that the futures market wasnt trading at the time ...
"Dear Sir
Thank you for your email. Please let me provide the context to our decision to suspend trading on our Japan 225 (Nikkei) markets last Wednesday evening. Firstly, the most important thing to note is that at the time we were acting as market makers because no futures markets were trading. We were making our price according to the volatility seen in other markets and client business that we were seeing. I am sure that you are already aware, but to expand on this further, USD/JPY had just dropped 3.5% in a matter of minutes. There was also news emerging from Japan that the Government would intervene imminently in order to try and weaken the Yen, and rumours that the Nikkei would not reopen as scheduled.
With all this in mind, we felt we had no option but to stop making a price for the short period until we could establish a firm market price when the underlying futures market opened. I am afraid that during this period we were unable to quote prices either online or over the phone to open new bets or close any that were existing. We resumed quoting as soon as we possibly could, around 30 minutes later.
Please understand that these circumstances were very unusual as market conditions of this nature occur very rarely. I hope the information above clearly explains our decision.
If you have any further queries please do not hesitate to contact me.
Kind regards,
Alex Moore
Dealing Support Desk
"
arabianights
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Yes that seems reasonable to me... OP got lucky 🙂
defender110
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Re: Email from Igindex
That's the exact same bloke who called me to resolve my issues, he's actually a manager so I think the help desk guys must of put two and two together with my claim and forwarded your email to him.
For the record he seemed a fair guy.
Can anyone advise of any reports / enquiries into SB that may exist - going back to my eairlier points i find it very worrying 90% loose SB'ing long term, surely SB can't be complete luck, it's based on real world markets and commodities for christ sake! Whats going on!?
That's the exact same bloke who called me to resolve my issues, he's actually a manager so I think the help desk guys must of put two and two together with my claim and forwarded your email to him.
For the record he seemed a fair guy.
Can anyone advise of any reports / enquiries into SB that may exist - going back to my eairlier points i find it very worrying 90% loose SB'ing long term, surely SB can't be complete luck, it's based on real world markets and commodities for christ sake! Whats going on!?
stevespray
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Re: Email from Igindex
Yes, that is true, but to put his comment into the correct context I think that he was trying to say that they were making their price using other markets due to the fact that the actual underlying market was closed. More commonly called a 'grey markets', spreadbetting firms will make certain markets 'out of hours' when the underlying futures are closed. The most common one is FTSE which is quoted by many firms on a 24 hour basis.
Yes, that is true, but to put his comment into the correct context I think that he was trying to say that they were making their price using other markets due to the fact that the actual underlying market was closed. More commonly called a 'grey markets', spreadbetting firms will make certain markets 'out of hours' when the underlying futures are closed. The most common one is FTSE which is quoted by many firms on a 24 hour basis.
"i find it very worrying 90% loose SB'ing long term, surely SB can't be complete luck, it's based on real world markets and commodities for christ sake! Whats going on!? "
If you consider betting with spread bets as being similar to poker playing in many mathematical & psychological respects and then examine the percentage of winners, you'll find that the percentage of long term winners is roughly very similar. Not much more than 10% of long term poker players are winners too, in other words. So 10% is not such a surprising figure: most people tend to run their losses and cut their profits too early for just one instance of poor discipline. On another note, I always found it bizarre in the late 90's/early 2000's, when there really were plenty of bad eggs (giving the few winning retail clients multiple re-quotes, manual execution, freezing the platform etc.) in the SB industry, that given how few were successful - why couldn't they just leave those 10% of winners alone, and rely on the fact that the SB firm's profits will come from the 90% who are statistically going to lose? On a positive note, in these days of far greater openness and transparency, we are all blessed for the fact that the SB companies seem to have got their act together on that issue at least.
If you consider betting with spread bets as being similar to poker playing in many mathematical & psychological respects and then examine the percentage of winners, you'll find that the percentage of long term winners is roughly very similar. Not much more than 10% of long term poker players are winners too, in other words. So 10% is not such a surprising figure: most people tend to run their losses and cut their profits too early for just one instance of poor discipline. On another note, I always found it bizarre in the late 90's/early 2000's, when there really were plenty of bad eggs (giving the few winning retail clients multiple re-quotes, manual execution, freezing the platform etc.) in the SB industry, that given how few were successful - why couldn't they just leave those 10% of winners alone, and rely on the fact that the SB firm's profits will come from the 90% who are statistically going to lose? On a positive note, in these days of far greater openness and transparency, we are all blessed for the fact that the SB companies seem to have got their act together on that issue at least.
Yes, you had to have been there to know how bad SB was in the early days. Why couldn't they just leave the 10% of winners alone? Probably just because every business tries to maximise its profit and minimise potential risk.
Ah, but alas, that made sense only in the short term. In the long term - such tactics end up shooting themselves (the SB companies) in the foot - through loss of good will/poor publicity, driving clients to open up additional accounts with competitor SB companies; and I can assure you for a fact,that on two separate occasions when at least one smart-ass, working at a certain SB company was messing around with my orders when I was on a winning streak (as good luck can happen from time to time...), presumably thinking he was oh soooo clever, I also happened to have had two persons of greater means than I, who were watching what was going on in front of their incredulous eyes. And let me tell you, they were very interested beforehand in signing up as new clients to that particular SB company, and that was in fact the only reason they'd called over, to spend some time learning how it all worked in real time! No prizes for guessing that once they witnessed the high jinks which I suffered after one too many successful bets, each person later joined another SB company, thinking I was crazy to do any business with that particular company. Even to this day, neither person (+ also, let's not forget, their loss of personal recommendation to others) would even think of opening an account with that particular company, no matter how much I try to convince either that times have changed, as the SB firms now have too much to lose through persons ranting off in forums, posting videos etc showing to everyone what happened. Now, no SB company wants to be the one that most in the blogging & forum communities refer to in unfavourable terms.
Accordingly, those bad eggs messing around with the few clients on any given winning streak might have saved a few foolish short term pennies and pounds (back in the bad old days) as they also ended up losing not only their continued undivided patronage but also the victim's most valued "worth of mouth" (personal recommendation is worth far more to the SB firms, a fact they really should have realised sooner, than all their advertising combined) to the firms which play fair. Naturally whoever played the role of "smartasses" back then, to this very day, never realised just how unluckily dumb it was to mess with those orders on those times when potential new customers were observing.
For sure, they saved a few unscrupulously taken pounds at best, and lost far, far more than that in new business. Leave those on a winning streak alone and they will sing the praises of the firm that played fair through good times & bad, which will in turn encourage more friends, family & acquaintances to become interested! After all, when on a winning streak people are far more likely to encourage others to watch to see how it can be done. Statistics will then look after the firm's long term profits infinitely better than any knavish attempts to throw a spanner in the works!
Hmmm, looking back on those particular times now, it's indeed quite satisfying to reflect on the idiocy of those who try to be too smart...
