I recall asking something similar a long time ago but never received a satisfactory answer. Why are the spreads when trying to buy some securites much higher than what i can buy using the bigger platforms like HL or Interactive Investor. For example i just tried to buy some Allianz Technology Trust and the quote on HL was a full 0.5 percent better than Trading 212. The other annoying thing with Trading 212 is you cant get a live quote before you confirm the order. The only way is to do a limit order but this is tiresome to always have to do this for small orders, first checking what you can get with another broker and then having to enter the limit order on T212.
I thought T212 use interactive brokers so why dont they have a live quote where you press confirm once your happy with it?
Some platforms do indeed offer quotes which are good for the next 10 seconds or so. But if you think about it, this must be because some party is facilitating this, making a profit by doing so, which comes eventually from end clients, perhaps through a higher dealing fee.
Suppose the market price moves down during those few seconds that the quote is offered. Wouldn’t you rather have the market price? About half the time that is what will happen.
This strategy was working fine when coinbase was not open after hours.
Then one day 212 opened up coinbase after hours- and the spread was over 10% and threw me out of the trade by hitting my stop loss.
Now i’d be fine if the price ever got to my stop loss price, but it never did it was only due to massive spread.
I have noticed this mainly happens with stocks open out of hours- my problem is if i knew 212 was going to change how this worked for coinbase i would have removed my stop loss.
How can i see in advance if something is going to start trading after hours?
For example i have gamestop with a stoploss- now if it opens after hours with something like a 15% spread im going to be thrown out! But if it never opens out of hours spread wont be an issue only price
All these leveraged ETPs have very little, if any, liquidity. Almost no trade between investors happen.
You see the size of the bid and ask being the same? These are limit orders sitting in the book by the Investment Bank partnering with Leveraged Shares, and acting as Market Maker. They provide the service that if you want to either buy or sell shares, there will always be a counterparty; and provide at the same time pricing range following the underlying index. But of course the spread they offer is quite large, partly as compensation for their services, partly to negate the risk they carry, and partly also to leave room on the order book for genuine trade; they will be your counterparty only when no one else is already looking to trade.
With a narrower spread, they would deny too many traders that set limits further away from the index.