Bid & Offer Zones



  • It's becoming increasing clear the amount of trading that takes place on FI doesn't lend itself to a full order book system. As things stand there simply isn't enough active traders to provide competitive pricing across all listed players. Those who are looking to buy players are understandably bidding as low as possible and as there's very few bids otherwise it's affecting other traders mindset when they see the selling potential of their precious assets continually drop in price.
    In my view order books should be seen as a distant aspiration, somewhere we hope to get to gradually when the market is capable of sustaining them with either the sheer amount of active traders or sufficient market makers to bridge the gap.
    Currently (as we've already witnessed) no matter what dividends are on offer or what promotion FI introduce it's not going to prevent the reducing sentiment which in my view is based solely on the lack of traders to sustain a full order book system. Effectively the virtual marketplace is a ghost town.
    I think "Brown Sunday" was the moment where the penny dropped with FI and they implemented the 1p below sell price restriction which has plugged the dam to a degree but we still have a situation where traders are underbidding each other on the buy side.
    Personally I'd like to see FI reducing the bid zone fully to match the offer side until the market is large enough or they have enough market makers in place to gradually loosen these zones.
    I understand there's an eventual necessity for the prices to represent their "true value" but with the lack of depth at the moment the market is tilted against its own progress which will likely prevent any future success.



  • @Wiillaah said in Bid & Offer Zones:

    As things stand there simply isn't enough active traders to provide competitive pricing across all listed players.

    The solution is market growth; the only way to provide both sufficient liquidity & market depth is by generating far greater demand from both new & existing users.

    Why is this not happening now? Many contributing factors amongst which are many current users are avoiding adding further funds to avoid triggering yet another round of intrusive EDD (the current system is overly intrusive & time consuming), new users are being driven away by an overly volatile market that has insufficient explanation & training resources, this generates bad trustpilot/social media/word of mouth reviews further dissuading new entrants, MM either not understanding or executing their purpose in a meaningful way, FI management repeatedly stumbling from one self inflicted disaster to the next & never allowing the platforms to settle around a coherent direction, all this on top of the significant external economic CV shocks that mean people are understandably hoarding their available cash to face an uncertain future.

    I believe that longer term the new dividend structure & full OB'S based on NASDAQ tech will provide the launch pad for this market growth but it may need further short term stimulus in the form of promotions, similar to the current 5X IPD & more effective MM liquidity support. It's in no ones interest to have holders stranded in illiquid players, often for months on end, however the 5X IPD promo proved that significant liquidity returned immediately, across all sectors of the market, when these players were eligible for a 10/20p bonus.

    It's also clearly undesirable to impose an artificial valuation, as the current bidding zones does, as liquidity simply evaporates. Full OB's allow players to trade at their correct market price (as determined by supply/demand & market sentiment) albeit with some short term volatility until market depth is achieved. Promotions & MM can be used in the short term to support the OB principle but to keep neutering it's main benefit is simply counter productive & causes more harm than good IMO.

    Whilst it may prove a rocky road, at least in the short term, I am firmly convinced that the platform is heading in the right direction & just needs to avoid any more self inflicted disasters in order to succeed.



  • @Wiillaah I suspect those who want the market to fully decide prices won't like another restriction but I'd be happy for it to be trialled to see if it helps.

    Sellers have more power than they realise at the moment. If people stop putting in low offers or accepting low bids, then the bids would rise on almost all of the market and such restrictions would not be needed. However, it seems too many at the moment were under cutting the buy price when selling or accepting the IS with massive spreads and, naturally, that just encourages even lower bids as buyers are obviously wanting to get in as cheap as possible. You can't blame buyers for that but the actions of some sellers mean we now have IS values on some players that is lower than it was before offers came in.

    If it needs something artificial to hold up IS and narrow the spread, I'd be prepared to see how that goes.



  • Doesn't help that lots can't now get on and trade... Sessions need to go or at least rotate the timings... Workers and parents getting a bum deal here. Is it a ploy to slow the selling? Is it due to nanny state lack of sleep complaints?

    Maybe we will see a bit of a trading boom at the wknd... But again lots of families won't stand for Dad on his phone throughout the day and would the nanny state want kids being ignored at the weekend rather than a few later nights mid week?



  • @Mintyfresh said in Bid & Offer Zones:

    @Wiillaah I suspect those who want the market to fully decide prices won't like another restriction but I'd be happy for it to be trialled to see if it helps.

    If people stop putting in low offers or accepting low bids, then the bids would rise on almost all of the market and such restrictions would not be needed.

    I agree with you but you can't afford not to undercut.

    This is trading, it's cut throat but ultimately, when you come to sell, people are going to be low-balling you, so if you don't get in at the lowest entry point, you're going to be getting hit from both sides.



  • @Westy said in Bid & Offer Zones:

    Doesn't help that lots can't now get on and trade... Sessions need to go or at least rotate the timings... Workers and parents getting a bum deal here. Is it a ploy to slow the selling? Is it due to nanny state lack of sleep complaints?

    Maybe we will see a bit of a trading boom at the wknd... But again lots of families won't stand for Dad on his phone throughout the day and would the nanny state want kids being ignored at the weekend rather than a few later nights mid week?

    Not sure I agree with you on this one mate; I’m a shift worker and a parent and I have plenty of time to trade. The closures ensures those looking to manipulate the market can’t do so when F.I. staff aren’t around.

    Many have complained about things happening over night that affects their holds when there is no one at FI to sort it; all traditional markets close, whilst i except bookies don’t FI is much smaller and doesn’t have the staff to allow a successful 24/7 trading platform.

    I don’t see a single negative having sessions



  • @Sav2000 said in Bid & Offer Zones:

    The closures ensures those looking to manipulate the market can’t do so when F.I. staff aren’t around.

    NASDAQ tech could solve that, AI works 24/7/365 & doesn't need staff to supervise it, any suspicious trading activity could lead to immediate temporary suspension in that player until a human was available to address any potential malpractise & the perpetrator punished.



  • @Geronimo159387 yeah happy with that, was more commenting on the current status of the platform.


Log in to reply