Has anyone worked out T212 CFD spread calculations?

After stupidly purchasing BRQ on their last run, i thought i’d wait until it ran again so i could sell at a small profit. I purchased in September at $1.41, and thought i’d sell at $1.46. As T212 explained their wide spreads were due to low volume, hurray i thought when it surpassed 3 million as surely the spread would be a few cents either side at most.

BRQ at 3 million+ volume went to $1.49 (on WeBull), however T212 spread lead it to $1.60 buy, and a sell price below $1.40.

oh the joys of trading with T212 CFD and their unfavourable spreads (comparison screen from WeBull)…

14/10/2020, 20:37

14/10/2020, 19:56

14/10/2020, 15:34

14/10/2020, 14:49

23/09/2020 20:19

if anyone has the details of the pricing procedure of T212 CFD please do share as i’m genuinely baffled why T212 would not be embarrassed to offer such a spread.

That’s got to be a mistake, invest/isa is 0.022

You have to go way out to looking at days to see the ask with a spread of 0.244

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wish it was phil, i posted BRQ as an example before, and hoped staff might of flagged it as an error, but nope, its just the joys of using T212 CFD.

i literally take screen shots so T212 can’t deny my experience.

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But it’s got to be I mean if I buy at 1.492 and I’m waiting for the bid at 1.248 to go above to start making profit it might take until the end of November to ever get that high :joy:

I mean that’s an impossible day trade or a very long swing :thinking:

It’s like the decimal is in the wrong place.

@David is this correct? Seems excessive at 1000% the normal spread

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Apparently T212 markup for CFD is not a percentage but a fixed amount , or perhaps a percentage with a minimum amount (or a percentage PLUS a fixed amoount). I noticed the spread to be around 0.27 for many stocks, regardless of the price, which makes it impossible to profit from cheaper shares.

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@Hectares @phildawson @Alien

The spread markup is in % & doesn’t vary wildly.

It’s just more noticeable with small caps as they have quite a large base spread as a % of their price compared to other companies.
Example: Microsoft, a $220+ stock usually has a 1-3 cents spread. BRQS, a $1.2 stock’s spread also swings between 1-3 cents.

We’re working on reducing the spread for all CFD instruments but hedging exposure for these small caps is quite difficult & costly.

It’s not a coincidence that no other CFD broker has Borqs Technologies.

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@Alien unfortunately it’s not a fixed amount as this would be the case on other US stocks.

Your reply isn’t accurate @David and spreads do vary wildly as this screen shot below shows, and i have Never seen a 1-3 cent spread for BRQS (in the past few weeks when i have been viewing and setting price alerts), please do take the time to view the BRQS data, as my user experience is not as you’ve stated.

Strange that when desktop viewing a USA stocks search from low to high, BRQS doesn’t appear (states BRQS is in a different category), however the separate image shows it has the widest spread, regardless of its volume, whilst lower priced stocks are much tighter, unsure how this percentage tool is working, is it working?

I don’t do CFD but can anyone win from this.

The spread of 0.022 is fine in Invest/ISA

The CFD spread is 1009.09% times that in this case.

Could it ever happen that the bid goes above the ask intraday? That’s a massive movement before you would start being green.

Note the scale of this chart is in days

Like with the sell price movement between 1.2 and 1.3 for the session, the bid even reaching 1.381 would be tricky with just the bid widened let alone near 1.5

@Hectares It is a fixed % but depends on the underlying base/raw exchange spread. In my previous statement where I compared Microsoft to BRQS, I was referring to their raw exchange spread - the one before any markup.

I just wanted to point out that BRQS has the same raw/base spread as a $220 company.

Is it worth removing BRQS from CFD? Seems with its raw/base spread that you would expect on a $220 company with the fixed % markup makes it a near impossible win? As you can see in my screenshot if the bid is moving between 1.2 and 1.3 during the entire day which appears to be normal trading, it’s never going to hit north of 1.5 to start going green?

Impossible intraday and a risky long swing at best.

Buy now in the hope that the bid is above 1.5 for Christmas (well above that to pay for the fees in holding it open?)

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not only this but all of the small cap stocks

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What I don’t understand though is the raw/base spread is ~0.022 on a stock with an ask of 1.381

That seems reasonable.

If we take Microsoft with ~$220 that is currently 220.90 ask and a 220.86 bid so a 0.04 is fine.

So yeah with a 0.02 spread its half that on a stock thats 159x smaller.

Is there any way T212 can adjust that fixed spread to take into account for small cap stocks?

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I’ve been meaning to do this myself but haven’t had time recently. I also don’t understand the “set %” applied to all stocks. Take this for example:

I’m just really focused on my largest actual stock, Scottish Mortgage (SMT). I’d like to hedge it during bloodbath days.

On the Invest side, SMT spread is:

Sell: 1,029.9

Buy: 1,033.1

Spread: 3.2 pence

On CFD side the spread is:

Sell: 1019.8

Buy: 1044.2

Spread: 24 pence!!!

So it seems the spread markup for this stock is 762% currently. But it’s hard to figure out how it works. The spread also increases if there’s low volume, so I guess the “set % markup” that every stock gets isn’t even noticeable. It’s the volume that really screws everything up. So how much of that 762% markup is attributable to volume? I’ve also seen stocks with really crappy volume, but relatively OK spreads, like Cineworld. Look how anemic it is, with lots of blank lines.

I would expect the spread on this to be about 12 miles wide, but it’s not too bad. And here’s SMT. Wider spread than anemic Cineworld, but higher volume?

Doesn’t make sense.

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@David have you checked BRQS? my concern is you are reading from a script of policys and procedures. why has T212 chose to ONLY place BRQS within these spread conditions and no other 1 dollar stock?

my example clearly showed the difference in low US stocks, which contradicts that it has a set/raw percentage as no other stock has this spread, and having access to Level 2 i’m very aware of the real buy/sell/bid/ask prices. WHY BRQS.

I have Never seen the small spread you referred to, neither have you replied to display otherwise, just that BRQS/1 dollar stock has the same spread as a $200 dollar stock, but all other US stocks doesn’t have this?.

i assume these larger than normal spreads is US stock related as IAG which has been the same price as BRQS has never been like this.

@phildawson The raw spread’s that large for a reason - it’s a risky & speculative stock, especially compared to Microsoft.

@Hectares We don’t have separate spread calculations for each stock. Every single stock CFD has the exact same percentage markup. BRQS is not an exception to the rule. If there are other $1 stocks with smaller spread, that means that the raw equity spread is smaller, it’s that simple…
There are other CFDs with a similarly large spread, although not as much as Borqs - VEON & SM energy, for example.

Last but not least, the small spread I referred to is not in regards to CFDs. It’s the spread when you trade the actual equity. It’s the spread that we mark up to get the CFD spread.

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I understand the reason for the wider spread on more volatile stocks, that’s not what I’m questioning.

I’m just saying if you’re applying exactly the same fixed percentage across everything it makes it impossible to actually win? Kinda pointless if you can never get the bid to get back over the ask, and vice versa going short.

You can see from the charts daily or even weekly movement wouldn’t be enough to break even with the very large spread.

Going back to MSFT 0.04 turning into 0.21 is absolutely fine as that movement is expected intraday on a $220 stock.

Needing the same 0.21 movement just to break even on a dollar stock is huge.

If T212 don’t want to take the risk in lowering the percentage applied for these, is it better to not have the instrument when the (customers) chance to come out profitable is slim to none?

The equivalent spread on Microsoft having the bid $217 but the ask at $260 pretty impossible day trade and a very long swing.

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I only use CFDs for trading forex (however spread is bit wider than other forex brokers), Indexes and commodities. The spread for small caps is just way too wide for a day trade.

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apologies for the delay in replying i was gardening :smile: … i think that’s the point with T212 CFD BRQS… the customer has less chance of winning and will close the trade at a loss so T212 can profit.
i requested BRQS for CFD as i was aware of other US dollar stock spreads, however BRQS can range from 10%-20% increase of the stocks overall value.

despite what’s happening with BRQS the spread IS much different to others.

i agree to removing BRQS/small caps with unjustifiable spreads… i am forced to sell at a loss, because at this rate the overnight fees will cost more.
well done T212 on adding such stocks, cleaver business move.

so baffled as i’ve compared US and UK stocks, their spreads, and volume, but still no consistency to figure out T212 unique calculations. Fortunately i’m using other CFD brokers, and will be leaving feedback on google/broker sites to assist new people of T212 CFD platform to simply avoid, as paying per-trade is much cheaper than this pretend free trading experience.