Share Dealing Discussion Area

cheerfulcat

tradetime wrote: »

Interesting, that's potentially dangerous, I'd have thought they would have to at least have some sort of proof you actually had the shares you were planning to sell, I suppose for a small amount they may not care, but I'm sure that must break some sort of FSA regulation

I've sold certificated shareholdings by phone several times through Hargreaves Lansdown, sending the certificates in after the sale. I've also bought shares over the phone with no money in the account. From memory the settlement time is T + 10. From their T&Cs -

Hargreaves Lansdown reserve the right not to accept a deal. You may only give dealing instructions to sell securities which you own and are in possession of a share certificate for. We will not accept short sales, i.e. the selling of shares which the client does not own. Should this be found to happen the sale will be reversed by repurchasing the stock. Full commission will be charged and you will be liable for any additional costs or charges incurred. Your account may also be terminated.
We reserve the right, at our sole discretion, to review and revise your trading limits, seek references or request cleared funds and/or share certificates to be provided by you at any time before and/or after a transaction. This may result in your transaction not being processed by us immediately and may mean that you are unable to deal immediately.

lisak79

The shares are being sold through Hargreaves Lansdown but they have not released the cheque for the shares until we get hold of the certificate to send to them so have got to find out where we can get a certificate from and how much it's likely to cost to obtain the certificate

cheerfulcat

lisak, going through the link provided in your other thread gives this -

In most cases, you'll need to pay an administration fee before we can send you a new share certificate. At the moment, the charge is £34.50 (including VAT). This is because we have to do extra work to make sure that the process is as secure as possible. You may, therefore, prefer to check your records again before phoning us.

There may also be a countersignature fee of between £22 and £200 depending on the value of the shareholding.

prudryden

tradetime wrote: »

Essentially, that is how a margin account works, if I have say £100k in my account the broker will extend margin of another £300k intraday, and another £100k overnight, essentially they just monitor the positions, and in all but a catastrophic collapse they can liquidate the positions when their value falls below the minimum marginable level, thereby limiting their risk, whilst charging margin interest as long as it is extended.

We are talking about dealing without a margin account. Margin account only means that you have an agreement to borrow funds or shares and pay interest. But some brokers will deal without a margin agreement. It is bad practice because if the funds are not paid in time for settlement, the broker is unable to charge interest as there is no agreement.

turbobob

Lokolo wrote: »

Ok can anyone explain the process?

Charges £10 buy and sell.

So I have £1000
X price is £1 a share

£1000 - £10 (to buy) = £990
£990 - 0.5% = £4.95

Total shares = 985.05

Is that correct?

Would be 985 shares - you can't buy a fraction of a share, unlike units in a trust

Lokolo

turbobob wrote: »

Would be 985 shares - you can't buy a fraction of a share, unlike units in a trust

How lame.

But I've gone the right way about how the number of shares is calculated? So: minus comission, then minus stamp duty, rest buys the actual shares?

prudryden

Lokolo wrote: »

How lame.

But I've gone the right way about how the number of shares is calculated? So: minus comission, then minus stamp duty, rest buys the actual shares?

Why don't you tell the broker how many shares you want to buy? That is the way the broker has to execute the order with the market makers. The broker shouldn't take responsibility for taking an order to buy a certain amount of £'s worth. I know it's done, but it isn't the correct procedure.

Buying funds in £'s worth is acceptable and normally traded that way, but not individual shares or corporate bonds.

Biggles

prudryden wrote: »

Buying funds in £'s worth is acceptable and normally traded that way, but not individual shares or corporate bonds.

Buying shares in £s is very common. On all online brokers' sites that I've ever seen you need to select to buy (or sell) a number of shares or to spend (or raise) a sum of money, they are quite used to it.

In fact, if you have a fixed limit, it's the only way to buy, since you will never know until the deal is placed the exact buying price per share (it will almost certainly not be the same as any buying price you see quoted on a website, as the dealer will get the best available price at that moment in time).

turbobob

Biggles wrote: »

In fact, if you have a fixed limit, it's the only way to buy, since you will never know until the deal is placed the exact buying price per share (it will almost certainly not be the same as any buying price you see quoted on a website, as the dealer will get the best available price at that moment in time).

The other way is instead of placing an order "at market" (to buy at that moment at the best available price) is to use a limit order. E.g. you place a limit order to buy 1000 shares of XYZ at £1.00. This type of order would only be filled if the shares become available at £1.00 or less. You can often set a time limit on these - e.g for that day only or for some point in the future. I tend to use limit orders more now, as it gives you more control.

tradetime

cheerfulcat wrote: »

I've sold certificated shareholdings by phone several times through Hargreaves Lansdown, sending the certificates in after the sale. I've also bought shares over the phone with no money in the account. From memory the settlement time is T + 10. From their T&Cs -

Interesting to know, from a curiosity point. I have always dealt with online brokers and margin accounts, as prudryden points out, there is a specific agreement between you and your broker for the advancement of funds on margin, and a corresponding interest charge for those funds. The only exception to that being iii for an ISA, but since I top it up in full on April 6th and thus can't add anything to it, then I can only buy with what is in the account.