Share Dealing Discussion Area

Biggles

GGM1903 wrote: »

I chose a company and processed the deal about 9PM at night. What time should the deal usually be carried out by the broker the next day? These particular shares opened quite low at 12.5p, which is why i went for this company, but by the time the deal was processed at 9.30AM the price had risen to 17.5p.

Does this time delay sound normal?

As already mentioned, your order should have been processed much earlier than that; not necessarily right on the open, as some shares' bid/offer prices are very volatile until the market settles down, but certainly within half an hour.

But you should have placed an order with a limit to buy at not more than, say, 15p. If you do that in future when you're not able to watch the price and buy 'live' yourself, you will be protected from such price spikes. What if it had doubled?

sabretoothtigger

What do you call it when there is a trailing stop loss that becomes more narrow the further away from the starting price it goes.

So say you wanted a tight stop loss but obviously you dont want it kicking in a minute after you set it or the next morning even. So you want 10% stop loss to start then 5% stop if stock price goes up 5% then declining to no less then 3% trailing stop loss.

Would somewhere fancy like IB do that ?
With halifax Im inclined to just do everything manually tbh, I dont hold onto anything I have to dump though obviously its crap if the price crashes suddenly, I tend to buy for the base line anyway

tradetime

sabretoothtigger wrote: »

What do you call it when there is a trailing stop loss that becomes more narrow the further away from the starting price it goes.

So say you wanted a tight stop loss but obviously you dont want it kicking in a minute after you set it or the next morning even. So you want 10% stop loss to start then 5% stop if stock price goes up 5% then declining to no less then 3% trailing stop loss.

Would somewhere fancy like IB do that ?
With halifax Im inclined to just do everything manually tbh, I dont hold onto anything I have to dump though obviously its crap if the price crashes suddenly, I tend to buy for the base line anyway

Yes IB's platform has the ability to make one programed modification to your stops, whatever type they are, price is the trigger, rather than time or date. Never used it as I'm always in front of the monitors and prefer to manually adjust any stops I am using. Bit gimmicky imho, you can occaisionally pre-select a stop level, for example if you had been long s&p the other day, with a stop in place, once we broke clear above the 960 level you were obviously going to move your stop up to just beneath that, but that was a very significant level, more often you need to see price progression to know where to move your stops to. Trailing stops I am not keen on unless you are unsure how to position normal stops.

cashbackproblems

I made my first trade today using the online broker iii and they charge £10 flat charge per transaction so as long as your trading £500+ it works out ok. When you paid a higher fee, are you sure they didnt include the dealing charges in this average trade sp, as its what iii do.

Lloyds/Barc have been flying recently and i bought into rbs at 41p which in 12-18 months is gona look dirt cheap! Also mining companies have alot of long run potential.

What kind of companies are people buying into?

sabretoothtigger

I sold rbs at 41, maybe you bought my shares

To be fair I should probably have bought them back when they were 36 because Im not quite sure where they'll head.
They have sextupled their share base in the last 12 months, sounds nice but thats partly why the price is so low for one of the worlds largest banks.
Ive read they should be 120p on their asset worth in theory

Buy on the dips for miners, they arent solid short term



http://www.iii.co.uk/investment/detail/?display=discussion&code=cotn%3ARBS.L&it=le&action=detail&id=4852752

cashbackproblems

Well i was looking to get in at 39p when an "expert" trader friend said they were expecting it to drop to 35p this week but im very much willing to keep it tied up for 2-3yrs if needs be so small increases/decreases are irrelevant at the moment. As everyone keeps saying the govt needs to make a profit on rbs and the ceo doesnt get his bonus unless they reach 70p so he will go all out to get this.

Other companies im watching are, Victoria Oil and Gas (VOG), EMED mining, African copper. what do you think?

sabretoothtigger

Never heard of them unfortunately, are they especially cheap for some reason. I just stick to big shares mostly because in theory alot of things are cheap right now, depends what happens next but commodities will fall when everyone realises usa and uk, etc arent about to bounce back as quickly as they fell.

The charts are showing like a V from last year for alot of stuff but other companies are as cheap now as they were in march so I reckon those are more likely to be bargains, the unloved shares :laugh:

Thats why I tend to avoid the obscure stuff, its more risky, theres less info and theres probably opportunity enough in the big stuff for me to be going on with



Heres a site I was using last year and stupidly ignored, it tries to rate risk and gives sector comparisons across the world

http://www.investinvalue.com/2/1/detail.php?ric=BP.L&a=Integrated+Oil+%26+Gas

peterg1965

tradetime wrote: »

Commissions with the numpty brokers will kill you, the same trade with Interactive Brokers will cost you £12 round trip, as long as you are not trading over £50k.
I should say that I am not sure moving £7k in and out of shares a few times a week is likely to be a productive use of it to be honest unless you are the best trader on the planet, and certainly an ISA is not the place for this.

I could you explain why moving £7K in and out of shares is not productive? Obviously I need to choose the right ones (FTSE 250/100 for me) and I will take profit so long as my costs are covered. If no profit in the short term, I will keep the shares for longer until the shares move up.

And why not in an ISA?

Have been looking at RBS, LLOY and BARC shares. probably missed the boat on BARC but RBS looks very cheap.

Aegis

peterg1965 wrote: »

I could you explain why moving £7K in and out of shares is not productive? Obviously I need to choose the right ones (FTSE 250/100 for me) and I will take profit so long as my costs are covered. If no profit in the short term, I will keep the shares for longer until the shares move up.

And why not in an ISA?

Have been looking at RBS, LLOY and BARC shares. probably missed the boat on BARC but RBS looks very cheap.

Assume a total cost of £12 per buy/sell combination and assume that you buy/sell 5 times a week. Your total trading cost is £60 and your stamp duty reserve tax is about £175. Across those 5 trades you now need to make £235 before you break even: 3.4% of the initial amount. Although this looks a bit better when you state it as 0.68% per trade, the spread between the bid and offer price probably means you'll need several percent growth per trade just to break even. All this is assuming that you use the full £7k in one stock, which would be rather risky. However, splitting your risk increases the number of trades and the percentage increase you need to break even. At £1000, the £12 trade and 0.5% stamp duty plus a bid/offer spread of 1% mean that you'll require 2.7% growth before you recoup your costs. Assume that you want to roughly double this to make it worth your while and you'll need 5% growth. That 5% will get you a profit of just £25 for all your troubles.

As long as you're happy buying for the long term this won't affect you too much, but my understanding is that people usually pick different shares for day trading than long-term holding. It's also my understanding that most day traders end up losing money and stopping very soon after they start because it wasn't working out.

Buying these within an ISA would probably be pointless for 2 reasons: additional dealing costs and/or annual account administration fees. Many brokers will charge extra for transactions within an ISA, or failing that will charge an annual fee to set up and manage and ISA wrapper in your name. However, if you're looking to day trade then you probably won't be holding the share long enough to earn a dividend, and with about £10000 allowance on capital gains before any tax is due, you're unlikely to break that with a starting sum of £7k. If you're looking to hold shares for the long term, an ISA becomes good for higher rate taxpayers because of the exemption from the higher rate income tax on the dividends, but for a basic rate taxpayer the extra charges (if applicable) plus the transaction fees for any switches can make it less useful than, for example, a managed fund ISA held with a discount IFA (i.e. no management fees, no switching fees, annual fees taken directly from the product), though this will depend on the size of the holding and how often you plan to rebalance.

peterg1965

Aegis, very useful post, thanks.

I do not believe I would do many trades per week. I have opened a Share ISA account with Selftrade and am about to transfer £7000 into the account. Here is my (probably) naive rationale for share buying/selling and trying to accumulate capital.

I conduct research using the various financial websites (H-L, iii, Moneyweek etc) and look at various share tips from those in the know. Decide on a company in which to invest, lets take an example of Company X which would be a FTSE 100 or FTSE 250 company.

I buy £7K worth of shares in my Selftrade account - cost £47.95 - £35 Stamp duty and £12.95 trading charge. Amount invested is therefore £6952.05.

I sit and wait, if the price goes down I do nothing and wait. If the price goes up then I would consider selling if/when the likely profit is significantly greater than the charges; £47.95 to buy and £12.95 to sell. So the share price needs to rise by about 0.8% for me to make a profit. Obviously I need to look at the bid/sell price which I was not clear on.

The key is clearly to choose the right share! (statement of the bl*****g obvious.

The Selftrade ISA doesn't have an admin charges although there is a £37+VAT charge per year on the account, but I get three free trades for that. I am a higher rate tax payer.