Recent problems with iWeb shares ISA

greenlettuce

I had been using the iWeb shares ISA without any problems for a couple of years, but recently I have had problems with stop-losses behaving erratically.

On the 17th. August they activated a stop-loss for a share which I had set to activate at 915 (915.325 to be exact), but every financial website including their website said that the lowest price reached that day was 953.50, way above the stop loss. They sold it for 914, so whoever bought it could have immediately sold it for at least 953.50 and made an instant profit.

On the friday the 25th. before this bank holiday weekend I see that an iWeb broker manually erroneously sold another share of mine in similar circumstances, but then cancelled it, which has caused inconsistencies in the records. There are also one or two other possible similar recent incidents which I do not have enough data to be sure about.

Round about that time they said they were doing something with their software.

So now I have the inconvenience of having to do a lot of paperwork to complain to the Financial Ombudsmen, and transfer to a more reliable broker.

Has anyone else had these problems? And can anyone recommend another broker?

eskbanker

Before going to the FOS you should obviously go through iWeb's complaints process, through which they may be able to resolve the specific issues to your satisfaction (e.g. reimbursing any actual losses and some sort of goodwill gesture) but beyond that, if you've lost confidence in them then you can clearly go elsewhere....

greenlettuce

I have has more problems with iWeb this morning. I wanted to buy two shares when and if they reached a "breakout" price, so their "limit order", where (they say) you buy or sell when the share reaches a particular price was just the ticket. But as soon as the limit orders were active, they bought the shares even though the limit order price were considerably above the current shares price.

Of course I immediately complained. But the man I spoke to claimed that because they say they will obtain the best price when they actually buy, that means they were right to buy the shares even though they were nowhere near the limit price.

But it does not say that anywhere. It is another example of them trying to add on further terms & conditions after you complain. As they were not going to correct things themselves I had to immediately sell the shares, which means I lost hundreds of pounds. Adding on the loss with the previous problem, I am worse off by about £800.

I wonder if they are just relying on peoples reluctance to undergo the inconvenience, unpleasantness and stress of complaining to the Ombudsman.

These two problems are due to them not "doing what it says on the tin" in my opinion. They promise one thing, they do another.

In addition, the software seems poor. More than once money has disappeared or being added incorrectly to my account before it is eventually as it should be several minutes later when I log in again. I often get opaque error messages which presumably mean something to the programmers.

They also claim that when buying or selling they search for the best price among many people, but I have never ever seen a list of them, so there is no means of knowing if this is true or not. Often shares can only be bought or sold for an unknown price, but perhaps this is true for other brokers also when they re busy.

So in my opinion, I would not recommend them.

IanManc

greenlettuce wrote: »

I have has more problems with iWeb this morning. I wanted to buy two shares when and if they reached a "breakout" price, so their "limit order", where (they say) you buy or sell when the share reaches a particular price was just the ticket. But as soon as the limit orders were active, they bought the shares even though the limit order price were considerably above the current shares price.

Of course I immediately complained. But the man I spoke to claimed that because they say they will obtain the best price when they actually buy, that means they were right to buy the shares even though they were nowhere near the limit price.

But it does not say that anywhere. It is another example of them trying to add on further terms & conditions after you complain. As they were not going to correct things themselves I had to immediately sell the shares, which means I lost hundreds of pounds. Adding on the loss with the previous problem, I am worse off by about £800.

I wonder if they are just relying on peoples reluctance to undergo the inconvenience, unpleasantness and stress of complaining to the Ombudsman.

These two problems are due to them not "doing what it says on the tin" in my opinion. They promise one thing, they do another.

In addition, the software seems poor. More than once money has disappeared or being added incorrectly to my account before it is eventually as it should be several minutes later when I log in again. I often get opaque error messages which presumably mean something to the programmers.

They also claim that when buying or selling they search for the best price among many people, but I have never ever seen a list of them, so there is no means of knowing if this is true or not. Often shares can only be bought or sold for an unknown price, but perhaps this is true for other brokers also when they re busy.

So in my opinion, I would not recommend them.

IWEB's order handling policy says the following:

"Trade plans Your limit and stop loss (TradePlan) order will be held by us (unless it has expired or is cancelled) until the market price meets, falls below or rises above the price you set. At this point a quote will be requested from a large number of market counterparties and your order will then be handled as detailed in the first paragraph. In the period between the price being achieved and the execution of the order, the price of the investment may have moved. This may mean that the order is dealt at a slightly different price to the TradePlan price. In certain market conditions, the price difference could be significant. In addition, specific events may cause the price of an investment to move to an unusually high or low price, which may cause your order to be dealt at those prices."

The "first paragraph" mentioned is as follows: "Automated systems When you place a trade we use automated systems to request quotes from a large number of market counterparties. Upon receipt of these quotes we will automatically take the best price available from those returned and then send your order to the appropriate market counterparty who will execute it at that price."

It appears that what has happened is entirely in accordance with the order handling policy and that the man you spoke to was correct.

The order handling policy document is short and clearly written, and your allegation that what the man at IWEB told you is not stated anywhere is untrue.

Your allegation of this being an example of them adding terms and conditions when you complain is also untrue.

You state "I had to immediately sell the shares" which you did not have to do. You chose to sell at a loss when you were under no compulsion to sell. The sale at a loss is your responsibility, not the responsibility of IWEB.

IWEB state that they search for prices from a large number of counterparties, which is the way that all major brokers organise their dealings. You appear to disbelieve them, but the fact that you say that you haven't seen a list of counterparties doesn't mean that IWEB doesn't use them.

You also state that "often shares can only be bought or sold for an unknown price". That is clearly also untrue. When you place an order with IWEB to either buy or sell a share the site provides you with a price quote and you have fifteen seconds, during which there is a time countdown on the screen, in which to choose to place the order or not. If, temporarily, a price cannot be obtained then you are invited to place an order at "best price" with their dealers, but there is no obligation to do so, and it does not happen automatically - you choose to do it or not. (On the other hand funds are always bought or sold for an unknown price on all sites due to the "forward pricing" mechanism used, where the price is set once a day by the fund manager and all pending orders are satisfied at that time and price. That is how funds work, and every platform works in the same way, not just IWEB.)

Perhaps it would be best if you save yourself "the inconvenience, unpleasantness and stress of complaining to the Ombudsman" seeing the allegations you have made today appear baseless.

And no, I don't work for IWEB.

:beer:

Alexland

Stop losses and similar pre-configured trading rules are liable to these types of issues as the decision is made on available market data and then the trade happens when the market has changed. It's even more erratic when the share has a small market cap so you have poor liquidity.

I had these problem on TD Waterhouse about 7 years when trying to be too clever with trading individual shares and sometimes they sold within hours of buying them! Thankfully I only lost a few hundred quid in that era as markets were otherwise rising.

Frankly if you must hold shares make sure they are liquid and don't set the automated trading limits to tight against the current share price.

I decided individual shares were a complete waste of time and am now a very happy fund holder with very low costs.

Alex

jimjames

greenlettuce wrote: »

I have has more problems with iWeb this morning.

So in my opinion, I would not recommend them.

It happened once, I would then have been very wary about doing it again.

I've used iWeb for a while and been very happy. I buy shares when I can control the price I purchase at.

greenlettuce

Sorry IanManc I did not think you quite get it - I wanted to buy the share if it reached a particular price - I did not want to buy it if it did not reach that price. The Limit Order was described as doing exactly that. But it did not do that in actuality, instead it bought the shares even though they were considerably below the price I had specified. And I cannot see anything in the T&Cs that said it would buy even if the price had not reached the price I specified.

Once the shares had reached the price I specified then of course hopefully the broker would look for the best deal for me. But that is very different from activating a purchase when it had not reached the price I wanted to buy at.

Let me give an example, while avoiding mentioning any particular share as this might be against the rules. If a share price is falling, then I do not want to buy it. But if it has touched bottom and started rising again, then I do want to buy it. I can tell if it is rising again because it will reach a particular price I have chosen which is higher than the current price. Instead of having to sit watching a screen all day, it is better to automate this by using a limit order to buy when the share reaches or touches my specified price. So I only want to buy when the share price reaches my limit order. I do not want to buy when the share price is lower, as this implies that the share price is still falling.

jimjames

You seem to have a very unusual and specific requirement that is unlikely to be needed for anyone else.

Generally most people would be very happy that they bought a share below the price they set as a limit as it means they got better value and more shares. Why would that not be a good thing? I'd be far more upset if I set a limit and the shares were bought ABOVE that price.

For selling I'd expect a stop loss to be the minimum price you'd accept and for buying it would be the maximum. It doesn't make a lot of sense for me if you set a price as the minimum for buying and only want to buy above that.

IanManc

greenlettuce wrote: »

Sorry IanManc I did not think you quite get it - I wanted to buy the share if it reached a particular price - I did not want to buy it if it did not reach that price. The Limit Order was described as doing exactly that. But it did not do that in actuality, instead it bought the shares even though they were considerably below the price I had specified. And I cannot see anything in the T&Cs that said it would buy even if the price had not reached the price I specified.

Once the shares had reached the price I specified then of course hopefully the broker would look for the best deal for me. But that is very different from activating a purchase when it had not reached the price I wanted to buy at.

Let me give an example, while avoiding mentioning any particular share as this might be against the rules. If a share price is falling, then I do not want to buy it. But if it has touched bottom and started rising again, then I do want to buy it. I can tell if it is rising again because it will reach a particular price I have chosen which is higher than the current price. Instead of having to sit watching a screen all day, it is better to automate this by using a limit order to buy when the share reaches or touches my specified price. So I only want to buy when the share price reaches my limit order. I do not want to buy when the share price is lower, as this implies that the share price is still falling.

You clearly still don't understand IWEB's limit order fulfilment policy even though I've reproduced it for you verbatim in this thread. You really shouldn't be placing limit orders when you've not read and understood the information IWEB provides.