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ISA Accounts & Stop Loss Orders
I've recently opened an ISA account with IG and discovered that stop loss orders are unavailable on some stocks (SETSqx). I've not come across this restriction with my HL ISA account and wondering if this is the case with all ISA accounts? I cannot trade without using stop losses so will have to close my IG account.
I'd be grateful for subscriber's recommendations of alternative ISA providers who provide low commissions and competitive spreads.
Ian
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10 comments
I think it's down to terminology but there is limit control... these are the four types
Limit execute & eliminate – an order which executes as much of a trade as possible at a specified market price. If there aren’t enough shares available at the specified level to fill the order, the maximum possible number of shares are executed and the rest of the order is cancelled.
Limit day – an order which executes once the market price reaches a specified level. If it isn’t filled by the end of the trading day, the order will expire.
Market day – an order which executes immediately in full if enough shares are available. If not, the maximum possible number of shares are executed and the rest of the order remains outstanding until the end of the trading day. This order type is unrestricted by price.
Stop market day – a market day order which executes in full when a specific price (the stop level) is surpassed. If there aren’t enough shares available, the rest of the order remains outstanding until the end of the trading day. This order is often used for locking in profits or limiting losses.
Hi Ian,
I have just found the same problem today on buying my first share with IG. On searching their Help this is what i found:
Help and support / Share dealing and ISAs
No, you can only add stops or limits to spread bets or CFD trades.
I have an ISA with Hargreaves and used stop loss and limit orders with no problem on AIM shares.
I thought IG was the answer to lower charges but this rules them out for me.
Many thanks
Chris
I don’t think that is correct but on some shares you can only put a limit order on for a day. I don’t use stop losses. I do limit orders to buy. I have HL and IG accounts although I’m trying to move from HL, their charges are too high, especially on US shares. Limit orders on HL don’t always work and stop losses are not guaranteed and don’t always either.
I have just checked on my Boohoo (LON:BOO) shares and I can put a stop order on them either for 1 day or until complete. You should beware that on IG they can do several orders to fill your order. On HL it is all or nothing.
From the link:
"Stop market day – a market day order which executes in full when a specific price (the stop level) is surpassed. If there aren’t enough shares available, the rest of the order remains outstanding until the end of the trading day. This order is often used for locking in profits or limiting losses."
Stops (both buy and sell) are available on IG ISA's but not for shares traded on SETSqx.
I use 3 "cheap and cheerful" brokers for ISAs - ii, xo and iWeb. ii has a charge of £2 + £7.99 (redeemable as free trade) per month, xo £5.95/trade, iWeb £5.00/trade.
They all do stop losses and iWeb has some variations also (range trading and price locking) and charges £2 (offset against dealing fee if triggered). ii sets some limits here: https://help.ii.co.uk/system/templates/selfservice/ii/help/customer/locale/en-GB/portal/402800000001013/content/Auth-4455/Placing-a-Limit-or-Stop-Loss-Order-Online
I have only used a limit order once so cannot vouch for how efficient or otherwise they are.
Hope this helps.
Thanks for the steer sharw, I've just been reading about iweb.
market makers know where the small fish have their stops and not hard for them to gobble these up in a volatile illiquid small cap. I've heard many high profile investors comment that they no longer use hard stops.
I think some do, some don't and probably depends more on trading style and stock selections. I've not been stopped out in this way before but I do try to avoid stocks that are very volatile and set my levels quite wide, usually selling manually if a holding is tanking.
I use both IG and HL ISAs. Yes some shares on IG you can't do stop losses. But I think you will have problems on any platform with stop losses on illiquid shares. I don't use stop losses anymore, been taken out of too many decent shares only to see them bounce back up.
Sorry I don't know of any other ISA platform with low fees that I can recommend. I ended up with IG because of their low fees, especially on US shares compared to HL.
Some subscribers use ii but their fees are not low.
Thanks Herbie, I'll persist with IG for a while, maybe I was just unlucky that my first trade with IG was the first time I've ever been refused a stop.