There’s been a dramatic increase in questions on the forum from new users who are surprised by the fact that the price they see in the app is not the price they actually get when trading stocks. There are lots of good reasons for this, such as delayed pricing, volatility, liquidity, bid/ask spreads, and foreign exchange. But newbies don’t know about any of this, and they get surprised when they get charged something different from what they think of as a fixed ‘sticker price’ (not ‘ticker price’ ).
As a matter of urgency to educate new users and try to head off some of these complaints, could Freetrade insert some explanation/warning messages into the buy/sell process to explain the likelihood of variations?
As a longer-term measure, could Freetrade consider displaying bid/ask spreads or some sort of information about the price dispersion of recent transactions to help users understand what is going on? I’m not sure what would be most useful and feasible, maybe other folks have ideas?
There’s a balance to be struck between keeping it simple and making it more informative, but I think Freetrade is currently too far on the ‘keep it simple’ side, and that users would be better served with a bit more information than they get through the app right now.
Is this something that is regulated by the FCA? I have seen so much confusion in the community when people have expected one price and paid/sold for another that it is surely unclear if not a little misleading?
It would not be so bad if the advantage were for the investor, but it is not!
I know prides itself on simplicity but as you say @Dave it should not be at the cost of accuracy - or in my opinion, at the cost of profit for the customer when using the platform as designed.
I get people want this information but personally I have never needed it as I think it is mainly for volatile/hype stocks. I can honesty say of the many transactions I have made I have never really noticed it being much different to what I expected and in fact probably more frequent it is better.
If it was for say GME last year I would watch a live site but it is difficult as this is one of many things that FT could add and if they did then the app would be nowhere near as clean and simple. The vast majority of FT customers are not sad gits like us on a forum talking about stocks but just buy and close I would assume.
I guess some don’t understand that the bid/ask spread itself is indicative. Horror of all horrors. And in any case the batching system that Freetrade uses makes the bid/spread set up useless for most people. If it is important to someone - put in a limit/stop and hope that someone exists to fill the order.
True, it is indicative. but my argument is that most of the time when people are confused they bought some penny stock with a >5% spread. If it showed this in the app people might think twice before buying stuff like that
My first couple of transactions (two lots of 12 shares) had half my buys rejected and the others a few pence cheaper than indicated, so I sort of worked out what’s happening and used a live site while buying my third lot.
Still, if there’s anywhere on Freetrade that explains it, that would be a help… have got a lot to learn on the journey and found articles and threads on here useful.
This is a difficult one to balance (and I’ve definitely faced the issue myself) but there are options since FT has some nifty tech behind the scenes. My opinions as follows:
For transactions that have large spreads or have limited liquidity Ask whether you wouldn’t to create a Limit order.
transactions that have not updated for a while - do something similar or get current price before allowing the trade.
bid/ask is good option for those that understand the markets but FT could reword it to say ‘Buy at’ or ‘Sell at’ especially for limited liquidity shares (and then offer option to Limit Buy / Limit sell).
My personal pet peeve though is the overnight changes to prices. I know it’s on the improvement list but it makes a big difference on prices especially during the market meltdown or the night before the ex-dividend date.
My final thought is around the Stop Loss, where I think it should have an option for a price range. Sometimes the drop is temporary and you might want to just “ride out” the volatility.
The above are just opinions and I’m pretty sure something could be done to improve the current situation.