When can a SB firm cancel a contract

[jls483]

I placed some contracts with a spreadbet firm - not mentioning any names! and a few minutes later I was phoned up by the SB firm and told that they were going to cancel the trades. The price feed they were using had gone down.

Is this legal?

Thanks,

John.

 

[jimbo57]

try this thread, from my own experience

http://www.trade2win.com/boards/showthread.php?t=14576

 

[millsy500]

I placed some contracts with a spreadbet firm - not mentioning any names! and a few minutes later I was phoned up by the SB firm and told that they were going to cancel the trades. The price feed they were using had gone down.

Is this legal?

Thanks,

John.

They do cancel and theres nothing you can do. Theres been times ive been in trades with no confirmation, try to phone, lines are engaged etc etc

 

[dcarrigan]

I placed some contracts with a spreadbet firm - not mentioning any names! and a few minutes later I was phoned up by the SB firm and told that they were going to cancel the trades. The price feed they were using had gone down.

Is this legal?

Thanks,

John.

most bookies have the clause in contracts that if a wrong price is given then the bet will be void. thats why ladbrokes etc, have lots of money floating around that punters dont even know is theres.

 

[counter_violent]

They do cancel and theres nothing you can do. Theres been times ive been in trades with no confirmation, try to phone, lines are engaged etc etc

Also they can and do re-open trades, due to incorrect pricing, ( theirs I might add )
that you think have already been closed. Yet another dirty trick in their comprehensive arsenal of weaponry. The punter must be defeated at all times.

C V

 

[millsy500]

You certainly have to be on your toes with these people. Being aware of each companys tricks is a good start

 

[martin brown]

I placed some contracts with a spreadbet firm - not mentioning any names! and a few minutes later I was phoned up by the SB firm and told that they were going to cancel the trades. The price feed they were using had gone down.

Is this legal?

Thanks,

John.

you bet on their price, and not the market price.

if their price feed was "down"/"pulled", then they should not allow clients to bets on that price.

if a bookie gives betting odds on a race, and then the bookie accepts a betting contract based on those odds, then the bookie must make good on that bet regardless. They can't just change the odds after the race for just the winners. that would be daylight robbery!

you have a betting contract, so i suggest you contact your lawyer.

btw, why dont you name & shame the SB company this thread?

 

[jls483]

Wow - what a can of worms. It might be worthing creating a list of known tricks for the Knowledge Lab so that spreadbetters can be more aware of what might go wrong.

I have certainly learned that trying to arbitrage prices with a spreadbet company is not a long term business position. Even if you are lucky enough to find the opportunities then you risk either
(i) having your trades cancelled (possibly illegally) and left with an exposure or
(ii) The SB company will slowly squeeze you out.

It is not something I am in the habit of doing and I definitely won't be doing again.

In fact I am very happy with the SB firm apart from this incident - which is one reason why I am not naming and shaming them. I think I will take this loss on the chin - well take a risk that one day silver will come back as the trade is still open. (Sell Silver £15/point 12.54). Just from a personal point of view it is not worth arguing about.

Thanks to everybody for their feedback.

John.

 

[stevespray]

Technically from a legal point of view a lot of what has been written in this thread is incorrect. Martin Brown has hit the nail on the head in his last post. Legally you are speculating on the level of a company’s index and not directly on the underlying. If a company’s feed fails then this is their problem and not yours.
Further more any contract formed in relation to a spreadbet is covered under the Financial Services and Markets Act of 2000. The Act states that all spreadbet contracts are enforceable by law by either party. You will find that most of the companies claim to have small print which allows them to reverse trades which might have been opened with you in error. For the most part this small print is unenforceable on the company’s part as, in the same contract, you will notice that it states that nothing in the contract will contradict the customers rights under the Financial Services and Markets Act. The contract will often go on to state something along the lines of ‘should a conflict occur between the customer agreement and the financial services and markets act then the financial services and market act will take precedence’. It therefore follows that the company trying to cancel a trade is a direct breach, under the financial services and markets act, of your right to enforce the contract in regard to the individual spread bet. If you press the compliance department then they will have no choice but to let you keep the bet.

Steve.

PS Not legally qualified to give advice etc etc etc.

 

[theEdge]

They tend to use the term "palpable error" when cancelling trades. When I've had trades cancelled in the past they told me that the prices were obviously incorrect. If I thought the prices were correct, why would I be betting against them? I now trade futures instead.