The Student Loan Ranger

Strong morning, but first things first; a reminder of how glad I am that I quit the UK market about a year ago.

When I wake up each morning, I check out Google Finance on my BlackBerry lifestyle choice device and read the first few articles that cover the overnight futures action and any major news in the pre-market.  The headlines are generally from WSJ or Reuters, sources I respect and enjoy reading.  Anyway WSJ and Reuters both indicated a lower open after some overnight selling (which is actually what happened, then the market ripped).

Anyway the third article said “US Stock Futures update: Futures up overnight”.  I checked the chart and this was total balls.  The source? Interactive Investor!  My old UK broker which I used to rant about all the time.  Their news was garbage, their platform was garbage, the data feed was unreliable, their commissions were obscene, their execution was terrible and their order types were very restrictive.  This makes me wonder why a site like Google would even look twice at their news feed.  II are a total joke, and I maintain that anyone who trades the UK market go to a shrink and get their head checked out.  I mean literally every stock in the US has a 1 cent spread, even thin small caps.  About 80% of the FTSE100 highest volume stocks have 5-20p spreads… come on!

My main issue with the UK market, except for the manipulation and commission costs was the lack of good solid information, data feeds and software.  Any respectable US broker who opens up shop in London would make an absolute fortune and would undoubtedly monopolise the brokerage market for non-instituional investors.

Anyway back to trading:

Bit of a body blow today in AEIS, after selling off my position in thirds yesterday, the stock is up 3.5% and looking pretty decent on the daily chart.  The problem here was that my stop was way too tight (it was only 1.25% risk instead of my usual 2.25%).  There was also positive divergence, and had I held until close I would have seen a nice candlestick reversal pattern which continues a nice trend with a 3 day reversal pattern.  This trade was really simple, but my execution was shocking and this is something I need to continue to work on.  It’s showing nice strength today while the large cap techs pull up the Qs.

Again my primary trading issue is my lack of capital, with more I would trade on a portfolio rotation basis with 10% positions in stocks like AEIS which would also be hedged.  This is derived from the relative strength issues from this week so far, I was short high strength and long weak strength.  I should really have a few positions in different sectors, and I’ll look into this today.

Here’s the AEIS daily:

AEIS daily

Sector strength analysis for past 5 days:

Relative Strength in sectors

Intra-day sector strength

Not seeing much in the way of entries today after spending most of the time setting up the RS charts for future analysis.

Update 18:30 BST

Money is moving out of the financials and the sector is not making new highs with the market.  Industrials and techs are taking charge with both sectors breaking bull flags.  Watch AAPL out of $166 to see if this RS analyis works or not.

Is there anything more enjoyable in this World than getting up on a bitterly freezing cold January morning and driving 20 minutes to install your brokers platform on a computer with no history of prior installation (and the client ID files that go with it) – just so you can close out a position that has now exceeded entry risk by over 5 times?

Email me if you know of anything more fun than that. Just so you know GBPUSD has done nothing but rip overnight.

Update:
I have closed the account with CMC. Look back later for a potentially humourous montage featuring the logos of iii.co.uk, CMC markets and the Union Jack and me looking victorious of course.

Well I think I am maybe a little bit more composed than I was a few hours ago. Although I don’t know if I should still be angry.

Here is an image that summarises how I have been feeling the past few hours, after my platform went awol on me. I cannot connect to the internet when my platform is on, and my platform has an update that needs to install (which I have already done by the way). The update itself stops itself from downloading, meaning I cannot log in.

I have a position open, short GBPUSD and I could be seriously exposed if I can’t close it at a loss as the system and everything else cut out as I was placing my stop limit orders. The only websites I can access are Google or it’s subsidiaries – including blogger.

Anyway enjoy.

I am absolutely livid with CMC Markets at the moment.

Unbeknown to me, they have started charging commissions.

They didn’t tell me about this.

I spent £170 on commissions on Friday.

So not only do I have to deal with a spread I have to deal with a commission that they didn’t even warn me about.

Morning update:
I am back in the game – CMC have said that fixed risk accounts are not subject to commissions and therefore I will be issued a refund.

However that did not stop me from making a horror show in BAY this morning

Afternoon update:
These guys are unbelievable. It now seems I will in fact be charged commissions for trading through CMC.

According to the nervous posh guy on the phone, there was a technical error with my account and it wasn’t put onto the automated commission system. I mean come on, have you ever heard of such a thing? These accounts are all automated, there isn’t a human sitting at a desk going “Oh yeah, wait a minute I haven’t put him on the ‘let’s lose his money’ list yet”. Unreal.

My initial question was this: If the system is automated, then why am I paying commissions? Why does anyone pay a commission for a CFD – there aren’t any brokers going out to the floor to get you the ticket at the best price are there? CMC Markets is really just a bookies at the end of the day.

The longer you trade, the more you realise that honesty, fair execution and reliability do not exist in any way on the contractor or brokerage side.

CMC Markets are looking set to join III in the shallow grave. I can’t keep giving these crooks my business.

I think these pictures tell enough of the story..

1. PRICE ACTION

2. THE WORLDS BEST DEALING TEAM?

3. SUMMATION OF EMOTIONS

III are bad, but today was the final straw. Weighing up my options on Sunday night, I decided to place a limit order for FGP as it looked good on moves over 531.75 as per my Crystal Balling blog.

I had college all day, but checked the price at 10am and it was around 516 – which meant that the stock had not yet pierced my trigger point, nor was it ready to short.

I got back today and checked my email, and I had an email from iii.co.uk – a standard “confirm your transaction”, which I thought was weird, because I hadn’t traded anything and FGP was way off any trigger points.

That was true.

But not if you’re a dodgy piece of crap dealer.

The daily high on FGP was 526.5 – over 5p and about half a percent away from my buy order at 531.75.

• III bought the stock on my account with an execution price of 524.24.
• At no point during the trading day was this price registered as a buy, sell or part of a contract. This leads me to believe that the iii dealing team sold me these stocks because they were going down.
• They sold them despite our bargain not being reached.
• They also sold them off the market and were not registered.

FGP closed the day down 4.1% at 506p putting me at a loss of £100 before I even had a chance to complain.

I am only a small player in the game, and no doubt this will go unanswered, but how can you succeed and trade mechanically when the third party human error element is still on in the background?

A buy order at 531.75 should be a buy order at 531.75, not buy at 524.24.

I am currently complaining to customer services, and have been on hold for quite a while. No doubt they are formulating excuses to validate their deal.

The only way they can resolve this favourably is a full refund of my original consideration and brokerage costs.

Update
After some investigation, I have discovered that not only did they make a mistake, 90% of my holding was a trade for 400 shares at the daily high – 1.5p above any other trade value throughout the whole day. Unbelievable!

A rant on my broker – iii.co.uk

Spotted a good quick trade opportunity on LSB this afternoon and got in for 13.5p at about 15:30, by 16:00 the stock was trading at 18p. The stock dropped a little bit to 16.5p – with L2 market depth (from iii) showing buyers still outnumbering sellers by about 3:1.

I clicked to sell on iii, and then it just said no. It kept saying there was some kind of issue about an open window preventing me from selling. I had no choice but to put it through as a negotiated trade. 20 minutes later, they miraculously sold the share for 14.5p – losing me £180 in that 20 minutes because their web interface is garbage.

Why should I pay for L2 if I can’t execute my trades based on that information? Why did iii block the sale? Why did it go to negotiated trade when the L2 was still strongly in favour of the sellers?

Anyway, the same thing happened when I tried to sell IEC earlier in the month. I have now applied for a brokerage account with E*Trade. III level 2 market data is the cheapest around, probably for a reason. The charting is not at all interactive and as I mentioned – what good is it if you can’t use it to make a trade?

It is also very annoying to see the lack of trading platforms provided by UK stockbrokers that provide the ability to sell from within the platform, instead of via a clunky web site. Unlike the Americans, who have plenty, it seems London still wants to keep a degree of exclusivity about trading stocks.