Barclays ''at best'' order type

1st May '18 by pjk15

7 comments 4449 reads

Good evening all,

Just a random question.
Does anyone here use the Barclays trading platform and has anyone used an ''At Best'' order?

It says:
Get the best price available to us at the time for the investment and quantity you want to buy or sell. At best orders can be placed at any time, even if the market is closed. If the market is closed, your order will be processed when it reopens again. Because you can’t set a price, the actual price at which you buy or sell may be higher or lower than you expected.

Does this mean if i was to place an order outside of market hours, the order would be executed immediately as soon as the market opens or the best price they can get throughout the day?

If anyone has any experience using this order type i'd be interested to hear how it went.

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WarrantStar

1st May '18

Hi PJK
Yes I use it frequently.
"At best" means the transaction will take place quite soon after the market opens. (Or it would be very soon if the market was currently open)
The upside of an "at best" deal is that you can be sure that the deal will go ahead. The potential downside is that you don't know the price that you will get. Barclays will scan the market prices available for your deal and pick the price that is best for you.
The alternative type of deal is a "limit price" With this you can set the minimum price that you will accept for a sale, or a maximum that you will accept if you are buying. You can set a maximum time period for these conditions that applies. eg 1 day or 1 week. If your price condition is not met in the time period that you set, then the deal will not take place. This is fine but you cannot be sure that the deal will go ahead. Hope this helps.

pjk15

Thanks Warranstar,

That clears a lot up for me, i've placed 2 limit orders the last 2 days and lost them both because everything opened higher than expected.

Would an at best order not be best used during the day in place of a quote and deal?
I always thought it wasn't the best idea to buy as soon as the market opens until everything settles down.
My concern would be placing an ''at best',' it gets executed at 8:30 and then an hour later everything settles and i bought higher than i should have.
Or am i overthinking this?

You are not overthinking it.
So it's down to 3 choices:
1) At best if you want to be sure that the deal goes ahead.
2) Limit if you want to have full control over the price
3) Quote and deal gives a good balance between the certainty of the deal and the price achieved, but you can only request such a deal during stock market hours which are normally 8.00 till 4.30. It is fairly common to look at the price that you are offered on 2 or 3 different occasions during a day before accepting the deal.

James RH

2nd May '18

"My concern would be placing an ''at best',' it gets executed at 8:30 and then an hour later everything settles and i bought higher than i should have."

Of course, it works in reverse also. Your order goes through at 8:30 then an hour later, after the market has woken up and digested any news, the share starts to rise.

It depends on why you're buying the share in the first place. Is it a 'value' share which you see as a long term investment in which case small price movements shouldn't be much of a concern? Is it a 'momentum' share you're trying to ride higher in which case unless there's news, I'd personally be inclined to let the dust settle in the morning.

peterg

I don't like putting "at best" orders in out of hours, for the reasons given - you can get caught out by sharp moves at the open, which may reverse, I got moderately badly burned that way some years ago. Of course it can work in your favour as well, if a share keeps on up, or down. But I prefer to know what I'm going to get so I generally don't trade in the first 30 min or so, and use quote and deal where possible - or limits if not. If quote and deal is not an option - sometimes on some less frequently traded instruments, or possibly also due to size - I use limits. I worry that using "at best" in those circumstances - when liquidity is low, or the size is large - that at best can be some way from what I expect!

So just an update for anyone who's curious.
I placed a buy limit for 2 days in a row on 2 shares and lost them because my price wasn't met and both times the share price rose and i lost potential gain.
This is now a very valuable learning experience for me, every time I've done a limit order I've placed it lower than the closing price because I've always seen prices drop in the morning. The 2 times I've done it this week didn't happen.

Since this is all a learning experience for me and I've never tried an ''at best'' buy i thought i'd take a chance.
I'm pleasantly surprised by the result. I bought Plus500 (LON:PLUS) at 10p lower than i wanted to place my limit order and have seen a gain today. (This stings because i lost out on buying it on Monday but never mind)
I also bought BP (LON:BP.) at 1p higher than i would have placed my limit order.

I am cautiously optimistic with using ''at best'' moving forward but i will review my limits more thoroughly in the future and try a more realistic price. I didn't like not having control over the price i'd be paying.

Richard Goodwin

7th May '18

I think by reputation that placing 'At Best' outside trading hours is fine for big liquid stocks, it is with smaller caps that you are more likely to get burned by market makers taking advantage.

Barclays ''at best'' order type

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Pjk15

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