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Jim Kernsey

Hi

I really need some advice on this one?

I have an account with an Irish Spread betting company, for the last month or so I’ve been placing bets on the price of crude oil, some successful some not.

My dilemma is this:

On the 29th of December, I placed a bet the price of oil would fall, it fall continuously, until one stage in the day it gave a sharp continuous drop in price, I closed my bet delighted with the €120 profit I made. 5 mins later I got a call explaining that this price was a "blip" on their feed from the exchange, they explained that a drop in price of 120 points in about 5 mins was so sharp it must have been a "blip", I didn't argue with this and accepted that errors happen.

Yesterday the same thing happened €129 rise in 3 mins, except this time it was against my favor and in that of the bookie, I rang and queried this drop, their explanation was that oil is a "severe market and a rapid change in price is perfectly normal". (What! last week you said it was abnormal and took my winnings off me!!!)

The most concerning part of this is that the before every bet is closed, a person in their back office manually checks the price, they then decide is the price is right or wrong, they don't have any technical details only there own opinion whether or not the price is right or wrong!!

So to summarise:

If a price is changes 120 points in 5 mins it’s got to be an error because it’s in my favour.

If a price is changes 120 points in 3 mins it’s NOT an error because it’s in the bookies favour.


Am I over reacting, or am I getting screwed
Is there anyway I can check what actually happened on the oil exchange?

Thanks in advance

JK

fintan

If you can tell me exactly what you were betting on, brent crude etc and what date and time i should be able to get you a price.

I reckon the first call was a load of rubbish, blips happen, but they are still good prices.

What betting exchange was it?

Jim Kernsey

Fintan

It was the 29th December at approx 2pm, I attempted to close a position at 3950. This was later refused.

All they say is that they had a "blip" in the price. This is what their operations director said:

"Our Brent price was showing incorrectly on the system at around 2pm on the
afternoon of the 29th. This was a result of a price "blip" which we
occasionally experience in the underlying feed from the IPE exchange."

"When the Brent price was corrected at 14:07, the Order
level was hit and presented to one of our Dealers to review. However,
because of the incorrect price, the order was not executed. The order was
then cancelled because the level was invalid for the corrected price."

My concern that it behaved in an identical manner on the 5th December, but they claim that it was behaving normally (coincidently this was €97 in their favour), I am concerned how do I know if they're telling the truth on either occasion?

They don't get informed by their IPE feed that its erronerous, they just use thier best opinion!!!

It’s like a horse race that finishes in dead heat, who chooses the winner? well its not usually the bookie! There is an independent judge who announces the winner.

In this case how do I know that there was actually an error in the price, or it was a severe swing?

TBH I no longer have faith in their systems and I’ll probably close my account tomorrow.

Cheers

JK

fintan

Ok im looking at pricing on a bloomberg. At two o'clock on the 29th trades were executed on the exchange at the following three prices 38.86, 38.95 and 38.96

Over a twenty minute time frame the price moved from 38.8 at 13.50 to 39.10 at 14.10

It reached a high of 39.60 and a low if 38.40 on the 29th and closed at 39.17

Now you have to remember that these are exchange prices, the spread betting company will not quote you this price but will create a wider bid / ask spread which is where they make most of their money. (think of it like the banks with foreign exchange, they make money on the commission and the exchange rate)

Did they tell you what their corrected price was at two o'clock?

Plus if this is something you want to do on a regular basis i would use city index

Jim Kernsey

Thanks for looking into this fintan

No they never told what they actual prices should have been, they never explained how they decide if it is a "Blip" or not.

While of course everything they say could be genuine i'm left with a nagging feeling at the back of my head saying "you've been screwed".

I'm currently using Deltaindex.ie, but i now realise that one "blip" is unacceptable never mind blips on a regular basis!! I've no trust left with Deltaindex.ie.

I sit infront of a computer all day, the spread betting account is more for fun than anything else, so i do intend opening an account with another company.

Yea i'll look into cityindex and i've also heard of igindex which do you recommend?

Thanks again

JK

fintan

I havent used IG index but i know they are another of the big uk companies. Only disadvantage is you have to set up a sterling account which introduces exchange rate risk into your profit & loss calculations.

Best of luck and happy trading

Jim Kernsey

I just closed my account.

After I opened my account they lodged €100 to my account as "New Account Bonus"

I suppose there entitled to this back? They never attached any terms and conditions to it, I thought it was a gift.

JK