Yet another spreadbetting complaint!!!

[megamuel]

I know there have been threads like this before but I couldn't find them and I guess all cases are different anyway.

Could someone please confirm for me that there was no price spike at 3am on AUD/NZD. I was long and had a stop at 1.2764 I checked the trade this morning and I had been stopped out over night at 3am at 1.2741 Not only is that 23 points away from my stop but on comparing prices with metatrader, I noticed the price never went anywhere near that level. Please see attached charts. One shows my spreadbetting chart and the price spike is circled in orange. The other shows the same bar in metatrader (highlighted in blue w/ orange line indicating where the spreadbetting company said price reached). I've emailed them and no response yet. The spreadbetting company in question is Interactive Investor (iii) by the way. Is this sort of thing legal??? Do I have any rights? As it turns out the trade failed anyway and if I'd have not been stopped out last night/ this morning I'd have closed the trade today where the price didn't hold up at my trendline for around about break even or maybe a small loss. But thats not the point, surely they can't do that? Any advice?

Anyway, I won't be spreadbetting for much longer as I am looking to go direct soon. Can anyone suggest a good DMA broker in the UK? Thanks,

Sam.

 

[Rossini]

Got no where near that on PRT as I can see? If your just trading FX then try FXCM. If not then try IB?

Hows the trading going anyway? You sorted a strat yet?

Pm me if you like.

 

[Vaco]

I had the same thing happen to me with cmc on a forex trade at about 5:30am i phoned the dealing desk straight away as i was watching the screen at the time. the spike lasted about 3 secs max.

They reversed the triggered stop for me but insisted that the interbank spread did get to that level. As they reversed the order for me i didn't argue but have now moved to alpari and have no such problems.

ps.

the price did not go there on my live alpari account but i think you have left it too late to call them now regardless of which way the trade would have gone.

 

[Mr. Charts]

Sam, I use IB for direct access for US stocks and occasionally trade FX using IB in the same account - always perfect, never a problem.
Richard

 

[megamuel]

Cheers guys! Oh well looks like I can wave goodbye to that money. Never mind.

Trading going ok thanks Ross - I'm using Andrews Pitchforks/Median lines now and finally got my account moving in the right direction! Albeit very slowly! I did take my account down to about £1500 but got it back up over £2000 now! Will such a small account size be a problem with DMA? Can you use leverage like with spreadbetting? I am clueless about DMA. I hear people talking about buying and selling 'lots'. What is a 'lot'?

So my choices are IB, FXCM, and Alpari? Anyone have any preference of the three? I'm only trading forex at the moment but I wouldn't want to limit myself so maybe IB is the best, unless the rates are much cheaper with the other 2 forex accounts? Any advice? Cheers,

Sam.

 

[disi]

I had the same thing happen to me with cmc on a forex trade at about 5:30am i phoned the dealing desk straight away as i was watching the screen at the time. the spike lasted about 3 secs max.

They reversed the triggered stop for me but insisted that the interbank spread did get to that level. As they reversed the order for me i didn't argue but have now moved to alpari and have no such problems.

ps.

the price did not go there on my live alpari account but i think you have left it too late to call them now regardless of which way the trade would have gone.

Alpari, CMC or others - guys. It happen always. Sooner or later it happens always. If you do not trade directly on futures market(CME or something) that it can happen to any broker. But if broker is 'fair' they will admit it was mistake in the system(or something) and give you cash back. I have seen hundred of examples where price difference was very large among different platforms. You will not avoid it. Look at it from other perspective - if I lose on such spike, there is a guy on opposite stick who just earned extra cash on that spike(limit order). We never think this way- do we? I mean - we do not complain "what's this? why I earned more than gusy on XYZ platform? That is not fair!"

 

[Vaco]

lots are how forex is traded the value of a lot or mini/micro lot can be worked out here Pip Calculator | Forex Pip Value Calculator

cant speak for dma but alpari has been fine for me, same leverage as spread betting. As for trading outside of forex you can always do that on your spread bet account

 

[Rossini]

Cheers guys! Oh well looks like I can wave goodbye to that money. Never mind.

Trading going ok thanks Ross - I'm using Andrews Pitchforks/Median lines now and finally got my account moving in the right direction! Albeit very slowly! I did take my account down to about £1500 but got it back up over £2000 now! Will such a small account size be a problem with DMA? Can you use leverage like with spreadbetting? I am clueless about DMA. I hear people talking about buying and selling 'lots'. What is a 'lot'?

So my choices are IB, FXCM, and Alpari? Anyone have any preference of the three? I'm only trading forex at the moment but I wouldn't want to limit myself so maybe IB is the best, unless the rates are much cheaper with the other 2 forex accounts? Any advice? Cheers,

Sam.

Every trade involves two currencies. The usual size of a pair is 100,000 units, known as a standard lot. The pip value of the pair you are trading is like £ per pip is SB terms. So Gbp/Jpy at the moment is £6.80 per lot per pip- where as Aud/Nzd is only £3.90. There are also mini lots, which are 10,000 units. And some brokers do micro lost which are 1000 units. I use FXCM, I find the liquidity good, spreads (on the active trader) are very nice and the platform is good to use.



I will PM you Sam.



R

 

[megamuel]

Well I can't afford to open an active trader account so it will have to be the standard 10k account (does that mean you can only trade mini lots?) or the metatrader 4 account. As I've been using MT4 for charting I might go for that one. Can you make money with referalls if so I'd be happy to help..

Sam.

 

[Rossini]

Well I can't afford to open an active trader account so it will have to be the standard 10k account (does that mean you can only trade mini lots?) or the metatrader 4 account. As I've been using MT4 for charting I might go for that one. Can you make money with referalls if so I'd be happy to help..

Sam.

No I carnt. I only suggested Brent because he is a good guy and helpful. I realise you wouldnt go with the active trader but the standard account is fine. The difference is the spreads are abit wider but you dont pay any commision. If you get a USD account then you can only trade in standard lots. The Gbp account you can trade in mini and standard lots which I think would give better flexibility for you? Plus the account is under the FSA and the funds are held in a hsbc in London.

Sound like a salesman dont I ;-)

 

[megamuel]

I phoned Interactive Investor up today. After 5 minutes or so of the guy telling me that it was because of the spread (lol!!!) and that is was a real market spike and me telling him that it was neither he then put me on hold while he checked it out. He then admitted that it was a mistake by their platform and price didn't really get to that level but get this, his solution was to refund the loss on the trade (great!) and put me back in where I initially entered (WHAT?!?!). The price has moved 200 points in the opposite direction now! I was like... "Can't you just refund the loss on that trade seeing as it was you that was at fault?"...NO!!!

Ok I understand that you trade the spreadbetting companies price. I even accept that they might manipulate it a bit at times for their benefit, but creating 70 point spikes at 3 am is just taking the p1ss in my opinion. All he could say was that if I'd have phoned up right after it happened they'd have put me back in.... BUT it was 3 in the morning!!! By the time I saw it the next day I wouldn't have wanted to be put back in anyway because the trade was moving against me and I've have closed at B/E or maybe a small loss.

Anyway, I asked him to withdraw my money and close my account. As far as I am concerned I will not let my money be manipulated by thieves. I am going direct. For anyone that is looking at starting spreadbetting, this is my opinion and advice against Interactive Investor (iii). They do not respond to emails. The manipulate price. Re-Quotes always at crucial times. Huuuuuuge spreads on some things. I think AUD/NZD trade was about 20+ points spread and that was spot not future... and when my stop got hit (wrongly) there was 23 points slippage anyway All in all I've not got a good thing to say about them, other then the bird that phoned me up to authorise my account when I first opened it sounded really hot and was proper flirting with me. So my advice to newbies - stay away from iii and look at IG Index or Futuresbetting.

So yeah looking to go direct with FXCM. But the meta trader account only offers spot and not futures, but I swing trade so I might have to go with the standard account. Does anyone know what the charting is like with the standard FXCM account? Pictures would be nice....

Sam.

 

[Shakone]

Look at it from other perspective - if I lose on such spike, there is a guy on opposite stick who just earned extra cash on that spike(limit order).

Well not really because it was in the middle of the night. That is when they typically can get away with these things, because there simply aren't enough people to take advantage of it. It is a spike, not a move, so those who were short, will wake up in the morning and probably not have profited at all from the spike. If you have twice as many longs as shorts overnight, and the gain from spiking to the stops outweighs the gain from the limit orders, then it is easy money for them.

If they do this, and the market didn't get anywhere near, then you should change spreadbetter, because not all of them do this, or change your trading habits to accommodate.

They do not respond to emails. The manipulate price. Re-Quotes always at crucial times. Huuuuuuge spreads on some things. I think AUD/NZD trade was about 20+ points spread and that was spot not future... and when my stop got hit (wrongly) there was 23 points slippage anyway

While I don't like the price manipulation, the spread on AUD/NZD is quite large anyway, and 20 points doesn't seem out of the world of possible. Besides, I think you have to take responsibility for that. Why trade something like that with such a big spread? Sorry I know that is not what you want to hear. You got a bit screwed, but also, you're blaming them for things that are actually your fault. You can't really expect them to refund the full loss on that trade, because it was a losing trade. They could re-initiate the trade with your previous stop loss and let it run from there, which is what they offered if I read correctly. And if it had moved more than your stop, then that would be the maximum loss they should charge you. It is ok in hindsight to say you would have exited the trade in the morning, but maybe you wouldn't have. You probably wouldn't have gotten out at break even, which is what you are requesting by asking for a full refund.

By the way, is your stop larger than 200 points?!

 

[rawrschach]

What do you mean by DMA? Are you looking to trade futures or spot?

If you're looking for small size you may as well trade with an ECN account.

 

[megamuel]

Well not really because it was in the middle of the night. That is when they typically can get away with these things, because there simply aren't enough people to take advantage of it. It is a spike, not a move, so those who were short, will wake up in the morning and probably not have profited at all from the spike. If you have twice as many longs as shorts overnight, and the gain from spiking to the stops outweighs the gain from the limit orders, then it is easy money for them.

If they do this, and the market didn't get anywhere near, then you should change spreadbetter, because not all of them do this, or change your trading habits to accommodate.



While I don't like the price manipulation, the spread on AUD/NZD is quite large anyway, and 20 points doesn't seem out of the world of possible. Besides, I think you have to take responsibility for that. Why trade something like that with such a big spread? Sorry I know that is not what you want to hear. You got a bit screwed, but also, you're blaming them for things that are actually your fault. You can't really expect them to refund the full loss on that trade, because it was a losing trade. They could re-initiate the trade with your previous stop loss and let it run from there, which is what they offered if I read correctly. And if it had moved more than your stop, then that would be the maximum loss they should charge you. It is ok in hindsight to say you would have exited the trade in the morning, but maybe you wouldn't have. You probably wouldn't have gotten out at break even, which is what you are requesting by asking for a full refund.

By the way, is your stop larger than 200 points?!

Ok maybe I am being a bit harsh but still I don't think a 70 price spike at 3am is fair when it never really happened. Yeah I didnt deal with it perfectly. I should have phoned them up as soon as I noticed it but I have anxiety problems and find it difficult talking on the phone (don't laugh). Ok so thats my fault/problem but I did email them and got no response and I phoned them today.

Here is exactly what happened in brief - opened a trade aud/nzd at my trendline. Price moved into profit, I went to bed with stop loss and limit in place. In the night it went up to 80 points profit and then moved back down and hovered at about 20 points profit. 3 am a big price spike occurs and I get stopped out where my stop was placed below previous low + a bit of slippage. However this spike never really happened and prices stayed around 20 points profit and slowly worked down towards what would have been breakeven when I checked at 9 am. If I was still in the trade, which I should have been at this point I'd have realised that the price had not held up at my trendline and I'd have closed the trade at B/E or small loss. Instead I fumbled around not knowing what to do, emailed them hoping they would restore my account to how it was before the trade seeing as it was their fault.

Stop was 50 point ish away and I lost about 75 points on that trade in the end. Nothing major but its the principal of the matter. Oh and I was trading a pair with such a big spread simply because it fitted the criteria for my setup.

Anyway yeah, I didn't deal with it well, I accept that, but nobody can say that a 70 point imaginary spike at 3 am is fair. Whats the point learning and practising technical analysis and trade management if they can do things like that?

Sam.

 

[megamuel]

What do you mean by DMA? Are you looking to trade futures or spot?

If you're looking for small size you may as well trade with an ECN account.

Forgive my lack of knowledge, I've only been trading about 8 or 9 months and I have been spreadbetting. I thought that DMA was the only alternative in which rather that placing bets on price movements you actually buy or sell contracts. I am not aware of ECN.

Maybe if I tell you what I am looking for you can better advise me. I want to trade forex - my normal holding time is approx 1-5 days so I believe futures are better than spot? I have a small account size of £2000 and I don't want to spreadbet. Thats pretty much the criteria. I have been looking at FXCM's standard and metatrader accounts. Is that DMA and do you think that would be a suitable alternative to spreadbetting? Thanks in advance,

Sam.

 

[rawrschach]

IMO £2000 is too small an account for trading futures if you're going to have 70 pip stops.

ECN is basically DMA for the spot market, although liquidity varies across brokers. So you can make prices and fees are charged as commissions and not a spread. I don't really know many brokers that do this, but I think broco allow small accounts, trading via currenex and MB Trading allow small size too.

 

[Shakone]

I don't think a 70 price spike at 3am is fair when it never really happened.

Yeah I agree totally. Better to change brokers if they are dishonest like that. It is better that you found this out now than later. You'll save money in the long run.