95% Rule Why ?…

Hi Can anyone tell me what the point is of the “You can not place an order over 95% of your free cash “ rule ??? Why not ??? Also I’ve said it before, the returns on the portfolio need to take into account the whole portfolio balance ie cash included.

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I agree with your comment that the portfolio should show total position.

I think (others can correct me) that the 95% is to allow some tolerance for fx variations. If you place a limit order you have to specify the quantity of shares (rather than value) and maximum price which is all fine if its in GBP but if its in another currency then changes to the fx rate could affect the amount of GBP funds required to execute the order.

It will be interesting to see what they do when multi-currency is operating because if you hold USD and place an order priced in USD then fx variation is irrelevant and I don’t know whether the software currently enforces the 95% rule even for orders priced in GBP when the base currency is GBP

Not just FX just on larger orders you might blast through a few rungs on the market order ladder meaning your order is incomplete.

That suggests that the limit price isn’t the maximum possible execution price. I know on some platforms you can specify a tolerance but I assumed/thought that on T212 the limit was an absolute maximum not a guideline

This happens on limit and market orders.

But also limit orders aren’t really limit orders. They convert to market orders on trigger.

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5% is one hell of a Tolerance. I would just keep putting orders in for example I’d put another order in for 95% of the original 5% that was left over if that makes sense, until I got as much into the position I wanted but it is a pain. And the way the returns is calculated is poor, according to T212 I’m up 7% but really it’s only around 5% if you take into account the whole balance. I not speak with forked tounge.

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Are you sure? I thought what you say is true for stop orders, not limit orders.

Totally agree! It’s not the most important issue, but it must be addressed as it drives me crazy!

7% is the right number. It shows the return of your current portfolio, not your free cash.


The way I see it Cash is a part of a portfolio so therefore should be incorporated in the total return of my portfolio. In my opinion.

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I don’t mind either way. The fix is to stick your cash in an Ultrashort.

Not now you mention it. Should be in the order execution policy if you want to check.

@Scrooge_McCodf the policy is a little ambiguous. In respect to limit orders it says that the order is executed immediately that the price is reached and that the limit order sets a maximum price and it also covers the situation where a price gaps over an order’s price (ie you get a lower price than the order) but it doesn’t say that a limit order is converted to a market order and it does say (but also doesn’t seem to explicitly exclude) that the price may trigger the order but then reverse and immediate execution still results in a worse (higher) price. Thus it seems to imply that a limit order’s price is the maximum you will pay but there is some ambiguity (but I’ve only skim read it extremely quickly so could have missed a crucial comment).

Aside from the technicalities of the execution mechanism, its interesting that you place a market order having no real idea of what the market bid/offer is and T212 are unable (or unwilling) to display bid/offer but when it comes to limit orders they are triggered purely on the buy price so something somewhere clearly knows what the real time bid/offer is.

Limit order on buy is the maximum you will pay, limit orders on sell in the minimum you will get.

I believe you can place a value order with the total of your free cash.