What this mail from IG mean?

GraHal wrote:

Pending Limit and Stop Orders remain unchanged / and will be executed as now?

Hi Grahal, I spoke with IG about this because of the slight uncertainty to me (first email). Vanilla ‘working orders’ will remain as is, LMT and STP, so too current at the time working orders, and subsequent ones. Manual trading from w/in PRT will now go from a ‘price limit instruction’, where it’d trade at that price, maybe better and a rejection occurring if price moved higher before IG received the order – to now executing any trade ‘at the current price’ you submit via the ProRealTime platform – whether to buy or sell – as a ‘market order’. So there pseudo limit order will be gone (because of rejections), while standard LMT and STP orders will remain as is and unaffected outside of what you and many others have said re: min. dist. through volatility. So basic strategies could do well out of this, some won’t as guess. Snipping into a level will go MKT rather than rejecting for example and get a better price (when against momentum) but breakout / momentum traders could see increased slippage the other side of that. The API looks the same as PRT, in a sense that API traders see min. dist. issues from what I could read and what the min. distances look like at those points (key s/r or breakout) I can’t tell you anything you don’t already know mate. I’ve not digested fully what Nicolas has said (looks to marry) but this post reflects what IG confirmed for me in an email, which should marry with the one you received. Hopefully. cheers inv

@inverse / Inv, I like to respond to your questions, but for now I have too much problems in understanding your language. But I may try in a next post after all. For now : IM(H)O it is all baloney what IG tries to put on us. There *is* no such thing as a price which moved in between our putting the order (Limit or Market does not matter) and when IG fi-na-ly receives it. It is like Grahal suggested (or at least the gist of it) : IG just puts pup the distance when they feel like it, which is with due Fed news but which is also due to bugs in their systems (during day time, nothing going on). A thing like a requirement of 100 points of distance just does not exist, but they throw it at us anyway. Will that be solved by some new means of Limit -> Market blahblah ? come on. To remember : this change is probably (up to hopefully) because of my own complaint and very strict cases, IG had to justify for. Or at least the other day, via my local PRT support PRT urged justification for happenings which can’t be other than not-so-legal manipulation. This “letter” seems to be a solution to that, but all what I see is that IG found another trick and masquerade. So Yes, the part of the “system will not be thrown out” (again, without them explicitly mentioning that)  will well be true and in the end genuine. But the infinite possibility to give you a slippage from here to Tokyo is something you need to see, and see fast before it is too late. In addition, deep down in my mind lures the idea that they most certainly are not there to help me, never mind I may have stoked this fire. I mean : IG will most certainly not lose money over some individual who finally could prove manipulation and held them responsible for the happening as such (with the fine help of ProRealTime in Paris). Thus, nothing will change, meaning : your order which complies to the 4 point distance (Nasdaq), will now suddenly enter at 20 points distance, you losing 16 points and nobody can complain because it was all in the small print. Mind you, it was not, but with the text from Nicolas it suddenly is (whether this is intentional I don’t know, but don’t underestimate politics behind the scenes – Nicolas may have received a text from IG with “clarification” and in all honesty it is posted because “it is good to let know” (IG told)). Below you see what this is about. The special occasion for that day, was that the “Fed news” protection by IG lasted for 1 hour and 20 minutes (you see it is 21:02 (Amsterdam) there, while news starts at 20:00) and I recall 24 attempts to restart systems because they all were thrown out immediately when the code deemed it good to open a position. So instead of earning EUR 2000 (on estimate) during that time period, I earned nothing because of systems thrown out. And this is not all, because I was fighting for this 1h20 to get the systems in over and over again, all in vain. And you know what ? when they finally kept on running, the moment was over and I earned nothing. And THIS is what IG is now going to solve. They now will (want to bet ?) :

1. Deal with your incoming positions manually instead of setting the distance to crazy high; (notice that they already deal manually with your Exiting positions during such periods)
2. Do this with 4 persons only (they just don’t have more for this);
3. My experience from Exiting positions tells me that this can last 90 seconds because a. my exit (SL !!) is at 15000, b. they are at it when the price is 14980, c. they wait and hope for a bit to let recuperate the price to close to 15000 again and when this does not happen they finally press a button hoping that I won’t complain too much. Meaning since the letter (per 28-03) : they will press buttons for your Entries (you too) knowing that they must have the time to hedge things.
4. They call this slippage.

Let me also add for this special occasion that where this concerns Limit orders (for Entry), I could show you an advisory email which suggests with a “you won’t do that anyway” : when you make that Market Orders all will be fine. And this is also – or especially – in the context of large orders (think 5-6M) or many orders within a time span, if only it concerns AutoTrading. Read the text from Nicolas again now. 😉 Net, I would say we will be off for the better. Suppose I would lose on average 10 points per Trade, then roughly I would earn maybe 1900 instead of thee theoretical 2000, while currently I have nothing but frustration. We will need to see how things work out for real, which could be up to No Entry at all, because if my order is set 20 points higher the price may not be touched, also knowing that the pending order lasts 1 minute only (in my case), so the moment will pass. Exciting times ? I think so. Something else for a change.

    @PeterSt, very much appreciate the feedback….and yes when goal posts move all we can do is try to work around it, no easy feat at times and I can feel your frustration. FWIW, you have understood perfectly from what I can see by how you have responded, so all good there. I get where you and GraHal are coming from. Please also keep posting as it’s invaluable to those looking to ‘stay alive’ in this kind of env. 1.20hr is a BIG window IMO, honestly too big, to be frank. There’s A LOT of WOW in that post. Your reading between the lines is impressive because it leverages your experiences with them and reveals quite a bit. Allows you to connect the dots. I hit PRT @ 260ms from AUS, so I’m not sure what the end-to-end delta is for trade execution is but I’m not HFT and in a ULL env. here either and so I’m a little curious as to how they’re fixing there rejection issues for traders that are happy to FIFO. IMO why not just pre-can a sweep w/max limit as other brokers have done and IG also do w/in there own platform in the guise of ‘pts thru current’ – IF I was PRT I’d be asking can we please have this exposed, not sure if it is via IG’s API but then again I’m not sure if they’re a high net worth ‘extractor’ or provider/partner/genuine-broker. I’m starting to sound a little cynical now. My first contact with IG a while back confirmed that if you don’t scalp/news trade you should? be ok. This confirms what you all have said at some point by way of min. dist. being employed when news drops / volatility spikes. Keep the posts coming and keep building a better mouse trap, look at what they won’t allow you to do but also plug away at what they will allow you to do, perhaps in between is the jam. They really need to keep it constant though and look to manage news events differently because 1.20hrs is simply ridiculous.

ahoj! my understanding of the announced change is that it will affect manually placed “at market” orders, so for automated trading and in particular for my system entries which are 99% “stop” orders (others are “at market” and never “limit”) I do expect either a) no impact or b) slight improvement in terms of less slippage, not more. why possibly a: my stop entry orders (if placement of the order not rejected due to those idiotic min.distances) are executed like real “at market” orders when intended price level is reached or exceeded, so execution is at intended price level – or with some slippage, but they are always executed, never rejected like sometimes those manually placed “at market” orders, which are in fact not “at market” orders (which I did not know 😀 because since many years not trading manually and I can’t remember how was it so many years ago…). and I also never got a rejection of “at market” orders placed by algos. why possibly b: less/no rejected manual “at market” orders by IG means logically more executed orders  – means more liquidity – which means in fact less slippage, not more. well, this I assume would be the effect in the real/free market where prices are driven by supply+demand+volume. but since CFDs are in that sense not real markets, I am not sure if we will see that positive effect on slippage, at least I do not expect negative one. why IG is implementing that announced change: well, we/I don’t know for sure, yet that argument of “better trading experience” I see purely as sales argument: they need to “sell” the change somehow in positive way to us, while the real backround might be very simple and logical: they want to earn more money, that’s their “raison d’être”, so why not. though I think in this case they don’t intend to earn more by “opening the doors” for more slippage, but simply by executing those fake “at market” orders which were so far rejected because in fact being “at limit” orders. more executed trades – more revenue for IG (and for PRT of course). regards justisan

inverse wrote:

You algo-boys-and-girls do fancy things in code, so my question was a genuine one based on never having traded systems before. Would I like to see the code for a genuine sweep-limit order, sure, but so far no one’s come forward haha and tbh I’m not sure how well it’d fair in a market maker env. given what’s been said w/in threads.

I am not sure what exactly you mean by sweep-limit order, but in case you mean an order with the logic like “buy x lots at price y stop and limit at price z”, as discussed here https://www.prorealcode.com/topic/creating-a-stop-limit-order-in-proorder/ and as I understood with no solution… well, I think (but again I am not sure, because not dealing with any kind of limit orders, except for exits sometimes) it’s not possible with PRT. so far about “fancy things in code”. we algo-boys-and-girls are limited to what PRT language allows (and even more – what IG accepts), and this language is not so much sophisticated “scripting language” (I think this is how IT guys call it), not a pure programming language, which makes it easy to learn and use, but well, I would say you can code a lot using it but not really “what ever you want”. I can imagine that it’s not really in interest of IG to allow such orders, as the consequence would probably be a lot of rejections / not filled orders / partially filled orders – which means less revenue for the market maker. or like IG would tell to us “worse trading experience” 😀

I am shocked by this price manipulation by IG…

When I was still trading at IG I never knew that my “market order”, an order where the immediacy is more important than the price (you don’t even enter a price), has been modified by IG with a limit instruction where the limit is undoubtedly made up of the price plus the minimum distance…

This is pure price manipulation, and I don’t know if this is clearly communicated in the terms and conditions, but if not then IG is treading on very thin ice…