Order books EUREKA MOMENT!



  • @shilly That's certainly the "glass half empty" way of looking at order books. The other way to look at it is that it will make the platform more professional and appealing to bigger investors which there simply aren't enough of. It will provide better opportunities to pick out of form players up at better value and therefore profit more when they become flavour of the month again.
    I know the types of traders that will lose out big time when order books come in - it's the sheep, those that follow risers blindly or any old pump on twitter. Buying at a peak out of FOMO will be punished far more severly than it is today and if anything that will bring a sense of rationality back to prices. Holding players that have real underlying value will become even more important.



  • I personally can't wait for order books.

    Be the best thing that can possibly happen for the platform.

    Sooner the better.



  • @Ericali That's 2 things we've now agreed on today.



  • @janner73 Agree with that.

    I also wonder about IS and the deltas. Presumably there will be more transparency over how many shares are queued and how this has/ will move the price?

    As for IS, does anyone foresee bigger spreads on IS prices? Or maybe not if the same process FI use now is applied, just with greater transparency.

    Like everything, the success of order books will depend on how they are implemented. I imagine we will see a very basic version first to bring us up to speed and then more complexity/ layers introduced later on.

    I'll nerd to observe a few match days first to gauge how they work
    Hopefully FI roll out a beta version ASAP...



  • @janner73 said in Order books EUREKA MOMENT!:

    @Ericali That's 2 things we've now agreed on today.

    People are scared of the unknown - there's absolutely nothing to be scared about.

    It's just another layer that enhances the platform.



  • @Metropolis If FI are smart they will go with as simple as possible a system to start with.
    Long term I think the aim will be for FI's IS price to disappear entirely and the sell prices you see will all be from buy orders. That's gonna be nowhere near feasible for quite some time so I expect they will slowly widen the spread to the IS price they offer as they see more and more liquidity through buy orders.
    I also would expect them to provide some kind of incentive for placing buy orders to encourage the liquidity they need to get on that side of the order book - maybe a reduced commission level or something along those lines.



  • @janner73 OK, but big concern about removing IS. It makes FI very forgiving for new traders which could impact the appeal of the platform and customer retention. Last thing they (and us) want is a complex system where the experienced make money at the expense of those who are still finding their feet. I don't FI will intentionally do that, but could happen. Perhaps offer IS for first month? I still use it myself though so hope they do keepit in some form.



  • @Metropolis I think IS will be there for much longer than the first month. It will be a long-term aim but one that will probably take years rather than months to get to. They will continue to provide it until they are comfortable that their is sufficient liquidity in the market to not need to.



  • @janner73 oh, no I meant first month for new users.

    Also, there are too many players with essentially no value if IS was removed. They wouldn't just let the shares expire surely?



  • @Metropolis Once the liquidity is there they wont need to provide IS though. If I place a buy order on Pogba at £5.56 right now. That £5.56 would be the IS price that anyone sees until it's taken. As long as they can get liquidity built up on the buy orders side then those buy orders are the IS prices. How they visualise that for new users though without over-complicating the UI will be key.



  • For the 50 thousandth time, there doesnt need to be an IS sell price as the price you can instantly sell at is the highest price that there is buy orders which in an ideal market will be basically a couple of pence below the current buy price (lowest sell order). Is this really that hard for people to understand?



  • @janner73 thank you. Every time order books come up people bang on about a lack of instant sell. With good liquidity, the "instant sell" will be higher than it currently is



  • @janner73 but what about the 20-40p players where there are only a few thousand shares issued. Would make trading at this level of the market very risky. The opposite of what it is now. Low risk due to tiny spreads.



  • @Metropolis It should be riskier. If you're taking a punt on a cheap player that you think might make it the risk/reward balance isn't right at the moment. It's too easy to bail on those players. Hence money floods quickly into those cheap players on a pump as the downside is so small.
    The reward should be great for finding a cheap under-valued player but the risk also needs to be a little higher.



  • @Metropolis the spreads are usually bigger on the 20-40p ish players. Take some of today's increasers and use sancho at £7.01 as a comparison: pizzi (46p) has a 7p spread which as a % is the same as a £1.07 spread on sancho, joe allen (32p) has a 3p spread, the same as a 66p spread on sancho. Vela (49p), 3p spread is same as 43p on sancho. Sancho currently has a 30p spread. Even same for those in a pb league. Florenzi (44p), 3p spread same as 48p on sancho



  • Ok so I thought I'd got it, but you guys have thrown up some things I hadn't considered.

    So, are we expecting order books AS WELL AS a simple buy/sell option to coexist?
    If that is the case, the thing that is really twisting my melon man is, what price is displayed on your holds when you check your portfolio?

    It's no bleedin wonder these order books are taking forever to be implemented by FI - it's a logistical nightmare!



  • @ScouseSte said in Order books EUREKA MOMENT!:

    Ok so I thought I'd got it, but you guys have thrown up some things I hadn't considered.

    So, are we expecting order books AS WELL AS a simple buy/sell option to coexist?
    If that is the case, the thing that is really twisting my melon man is, what price is displayed on your holds when you check your portfolio?

    It's no bleedin wonder these order books are taking forever to be implemented by FI - it's a logistical nightmare!

    No the buy price will be exactly as it is - unless you buy from someone who is looking to sell.

    In which case your personal buy price will be lower.

    Your portfolio will calculate the 'official' buy price - not off someone who will accept lower in the sell queue.

    I did a thread on it @ScouseSte about 7-10 days ago - have a read. 👍



  • @Vespasian32 this is exactly my concern. Prices may fluctuate but they may not really rise much. How will they even work the buy price because someone could essentially buy a player at £2 and straight away set his exit price by then putting a sell order in for £4 i the hope that one day he reaches that price and the order gets fulfilled but in the meantime FI are issuing new shares for £2.10.
    The point im trying to make is that once thousands of us are buying and selling using order books the buy price could become irrelevant as there will be countless orders out there waiting to be fulfilled and as they are prices could just swing up and down instead of climbing in value because what happens when FI’s buy price reaches the same price at which an order is set? Which shares sell first?



  • The only way i can see that they can do it is by limiting the range by only allowing orders set between the higher buy and lower sell price which then seems to me like a massive waste of time and effort for FI and not of much benefit to anyone. Thats my opinion on it and im not a fan of it being implemented



  • @Ericali said in Order books EUREKA MOMENT!:

    @ScouseSte said in Order books EUREKA MOMENT!:

    Ok so I thought I'd got it, but you guys have thrown up some things I hadn't considered.

    So, are we expecting order books AS WELL AS a simple buy/sell option to coexist?
    If that is the case, the thing that is really twisting my melon man is, what price is displayed on your holds when you check your portfolio?

    It's no bleedin wonder these order books are taking forever to be implemented by FI - it's a logistical nightmare!

    No the buy price will be exactly as it is - unless you buy from someone who is looking to sell.

    In which case your personal buy price will be lower.

    Your portfolio will calculate the 'official' buy price - not off someone who will accept lower in the sell queue.

    I did a thread on it @ScouseSte about 7-10 days ago - have a read. 👍

    OK so let's say Messi is £6.10 but you put him up in the order book queue for £6.05 cos you want out - I quickly notice and buy all 300 off you.
    In my portfolio it will show the buy price as £6.05 but I'll immediately be up £15 because the current general price is £6.10. That how you see it?


Log in to reply