Buying ILGs on iWeb

Secret2ndAccount

There was a trade of 4693 of TR31 at 95.66  just now. 

was that you?   You paid a tiny bit more than the other guys, but they did buy 10x or 100x as much as you, so can't really complain.

DRS1

So how long was it before you got an email saying you could log in and see your contract note?

Oh and does your list of investments show you buying at the dirty price but the holding value at the clean price - so an immediate loss of what 20%?

tigerspill

Secret2ndAccount said:

There was a trade of 4693 of TR31 at 95.66  just now. 

was that you?   You paid a tiny bit more than the other guys, but they did buy 10x or 100x as much as you, so can't really complain.

That looks like mine.  My contract note says 4692.88 GBP so the table rounds the cost.
I paid 132.503852 GBP per gilt dirty price.
iWeb is showing the current value using clean price so a large drop which is a bit of a pain as I track my accounts as a whole.
I did seem to pay a wee bit more, but still under 100 so a bit of profit locked in.
Where do you see the trades?

tigerspill

DRS1 said:

So how long was it before you got an email saying you could log in and see your contract note?

Oh and does your list of investments show you buying at the dirty price but the holding value at the clean price - so an immediate loss of what 20%?

I received the confirmation email at 14:56.  The table S2A posted shows the trade at 14:51.  I took a screen shot of the order at 14:46.  So start to finish was 10 minutes.  Though I didnt log in until a few minutes ago.

Yes, it shows value at clean price so showing a loss of 28.1% which is a bit of a pain for tracking totals.  I am glad those that know way more than me had pointed that this might be the case (on other platforms) so I was expecting this thankfully, or I would have been in a panic.

Secret2ndAccount

tigerspill said:

Yes, it shows value at clean price so showing a loss of 28.1% which is a bit of a pain for tracking totals...

Very annoying. On Interactive Investor, you can edit the cost field:


Pity iWeb doesn't offer that.

You can view gilt trades on the London Stock Exchange:
https://www.londonstockexchange.com/stock/TR31/united-kingdom/trade-recap

DRS1

MK62 said:

DRS1 said:

MK62 said:

Bear in mind that you buy in 100ths of a gilt, so to buy say 73 gilts you'd enter 7300 as the quantity, rather than 73.
Also you can buy fractions of a gilt too (in 1/100ths), so eg for 73.68 gilts, you'd enter 7368.
This can be confusing, as you won't see the price/cost details of the negotiated order before you press "confirm"........just the number of gilts you are buying......

Personally I'd get nervous about specifying a number of gilts to buy I much prefer specifying how much I want to spend on buying them.

Fair enough, but if implementing a gilt ladder, it will likely rely on a specific number of each gilt........though it most likely wouldn't make a big difference.....either way!

OK. This is a bit academic and as you say will probably make little difference but

If I look at the Lategenexer gilt ladder builder (for generating 10k a year using ILGs) it will tell me that it will cost me £9241.19 to buy 55.02 units of T29 at a dirty price of 167.95.  What you are saying is that I should not enter the number 55.02 in the buy box but the number 5502.  That is useful information because I could easily have taken lategenex at face value and got it all horribly wrong.

But the other thing is that  lategenexer is using the prices at 10/12 not todays price (today the dirty price I got was 168.125061 although the giltsyield page says today's dirty price is 168.087).  So either I specify the amount I want to spend (eg the cost figure from lategenexer) and get a slightly smaller number of units or I just buy the number from lategenexer (times 100) and pay a bit extra?  Or I adjust the lategenexer price from 167.95 to the giltsyield price of 168.087 to work out what 5502 units should be at the new price and buy that number of units.

Even with a useful tool like lategenexer building a gilts ladder is tricky business.  If prices are going up it will either cost you a bit more than you thought or you will get a bit less than you thought at the other end.

MK62

The dirty price quoted on giltsyield is most likely the midprice (and most likely at least 20 mins behind the market).....the buy price will be a tad higher (as you found out) and the sell price a tad lower - the bid-offer spread.......which appears to be typically around 1% on index linked gilts.

michaels

MK62 said:

The dirty price quoted on giltsyield is most likely the midprice (and most likely at least 20 mins behind the market).....the buy price will be a tad higher (as you found out) and the sell price a tad lower - the bid-offer spread.......which appears to be typically around 1% on index linked gilts.

Obviously you only lose half the spread f holding to maturity but I guess 0.5% is still enough to be of relevance especially for the really short time periods.

SnowMan

Scottish Widows (iweb) have a document about buying index linked gilts (or gilts) on their platform

https://www.scottishwidows.co.uk/assets/literature/docs/bond-and-gilt-orders.pdf

Negotiated orders for purchase have always worked fine for me. They have all been done quickly and seem to go through at very close to the mid-market price. Don't think the bid/offer spread is anything like 1%, but it's hard to say exactly how much the spread actually is.

Alexland

SnowMan said:

Scottish Widows (iweb) have a document about buying index linked gilts (or gilts) on their platform

https://www.scottishwidows.co.uk/assets/literature/docs/bond-and-gilt-orders.pdf

Negotiated orders for purchase have always worked fine for me. They have all been done quickly and seem to go through at very close to the mid-market price. Don't think the bid/offer spread is anything like 1%, but it's hard to say exactly how much the spread actually is.

I've had a great experience buying ILGs in my AJ Bell SIPP.

When buying online they only offer Market Order in the dropdown list (which gets sent to their dealing team to deal at any price similar to iWeb negotiated orders) but if you phone their dealing team they can place a Kill Or Fill order where you specify a maximum clean price you are willing to pay (and the total amount you are willing to spend) and they phone you back if they are unable to achieve it. They still only charge £5 for the trade. Unsure if they charge if it fails but who cares.

My guess is the spread on my order was around 0.5% but yes it's hard to tell but I still got a better price than the closing price on dividenddata and I could see from the more liquid INXG ETF the ILG market was going down compared to the previous day. I like that the gilt shows the dirty price in the account valuation. For small coupon reinvestment I'm fine with Market Orders but for anything big I'll phone for Kill Or Fill orders.

If doing big ILG trades in a S&S ISA then it's worth considering paying AJ Bell their capped £42 pa (on exchange traded assets not funds) compared to other platforms where you have no control over the price they might pay. It only takes avoiding one bad trade at a time when prices are a bit screwed up with low liquidity for the platform to have more than paid for itself.