Why do my limit orders not complete?

I’m getting very confused with limit orders. It might be related to it being a low-volume stock, but even then there’s something else not right, as my buy order is being ignored when buy orders from other people at a lower price are being fulfilled.

After having been burned by placing a regular buy on TM17 (all the recent trades were around £7.30), mine happily went through at £7.50, I decided to test out limit orders.

I placed a limit order for £7.30 and that completed immediately. I was quite pleased.

As the price had dropped to £7.24, I placed another limit order for £7.22 and went to lunch. Came back to find that there had been 4 trades lower than my buy price (all for £7.20 or lower). As the price was now below £7.20, I deleted my limit order and placed a new one at £7.20 which completed immediately. Even though, I’d just had an active one for a higher price moments before.

I’ve had another limit order for 2 shares at £7.12 placed for about an hour now. There have been multiple trades since then at £7.10, including one for exactly 2 shares (which occurred some time after I placed my limit order), followed by some bigger orders 5 minutes later, also for £7.10.

So, my questions are:

  • Why wouldn’t my limit buys succeed when I’m offering more than someone else for the same quantity?
  • Why if I cancel my limit buy and create a new one at a lower price, will the buy complete even though the original one didn’t?

BTW, I’m using the history on Google Finance to see prices & volumes of trades.

And another hour later, another trade went through at £7.11 when my limit buy order for £7.12 is still active.

Does anyone have any idea about this? I’m sure there must be some hidden commission in the bid-ask spread, but I’ve no idea where to find out what this is.

I’m about to give up on AIM stock after my experience with TM17. It seems almost impossible to buy at a reasonable price and even harder to get rid of it again.

My first few trades I got completely stuffed by not using limit orders and just using a regular buy order, and the trades went through at over 1% above the price for all the other trades that day, even though I put my order in at about the dip. When I used limit orders to buy, they were not being honoured despite the price going lower.

The price seems to fluctuate by 5% on a daily basis, so I managed to snatch up two cheap shares using the regular buy but specifying a very precise price, which has just about reset my average to the average trade price over the last week.

If I can’t buy shares at a fair price unless I only buy one at a time using a regular order, it doesn’t seem worth the hassle. So, now I just want to get rid of these stocks, but again I’m discovering that having a limit sell order in place is useless - trades are going through at higher price despite a limit sell order I’ve had in place for days at a lower price. But selling via a regular order is likely to make me lose a lot more money because I have no control over the price.

It’s clear that even if Freetrade doesn’t take a commission on the trade, the broker is doing something on the spreads. I’d just like to know what it is so that can cancel my limit order and put one in when the share price rises enough for me to be able to put a limit order at my target and have it execute immediately.

How can I discover this information? It must surely be available somewhere?

Have I just learned the lesson to never invest in AIM or low-volume stocks, or is there something else in play here?

Aaaaargh! This is soooooo frustrating. So many orders are going through at over 1% above my limit sell and my orders are never selling. I’ve tried cancelling and just doing 1 share, and I can see an hour later 1 share is purchased for more than my limit order. Cancel that. Put them all up for share. Still more orders above my price. Still nothing.

My only conclusion is that there ARE in fact hidden fees and the broker that FT uses is ignoring my limit sells until there’s some certain profit margin in it for them. I guess that’s just the cost of doing business if so and to be honest, I don’t much care, I just want to know what it is so that I can price my limit order accordingly to get rid of these shares.

But having a limit sell open for about a week that never completes even though it’s substantially under the current trading prices is just infuriating.

For more information, I had a limit sell order open for about a week at 7.66. As there were multiple trades this morning above 7.70, I cancelled it and tried to sell a single share for 7.69. I left that active for a couple of hours, and over lunch, there were a lot of trades a lot higher, including a single share for 7.80. Yet my share was still sitting there unsold. There’s been a bunch more trades going on around 7.78 and yet my sell is still unsold.

But there’s no way I’m just putting a regular sell order out there, because given how much of a premium the regular buy orders completed for, I reckon I’d get royally stuffed selling too.

The buy price may reach the 7.70/7.80 price, but the sell price is probably still below it… you need to take into account the bid/ask spread - Bid-Ask Spread Definition

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I know there’s always a spread, but I can’t figure out what the spread is…

I’d have thought that with some of the trades going for 1.5% over my sell price, I should have hit it already?

The Bid price is 760 as at ~1.30pm today which is lower than your limit price. i.e market is not looking to buy above this price.

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I set up a limit sell for £7.60 and they completed immediately for £7.61. I didn’t realise the spread would need be quite so large, it seemed to be a lot less when trading other stocks.

But £7.60 covered my average cost, so I’m happy just to get rid of them as they’re the only shares I’ve had so far that have annoyed me with unexpectedly a high prices on buy compared to what the “current” price was.

So, is the reason just because it’s AIM? Or because it’s low volume?

The reason why some AIM stocks have massive spreads is liquidity, in that the Market Makers do not believe they can easily sell the shares as quick, so if there is only a small percentage in free float then this becomes a problem for the MM to sell the shares on, so in order to buy your shares the market maker will usually issue insane spreads so to take the chance that they can sell them on

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AIM 100 companies have an average bid-ask spread of 1.96%, whilst the smaller cap businesses listed on the rest of the market have an average bid-ask spread of 6.3%.
To put this in context, long-term returns from UK equities average around 7% a year.

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6.3% seems incredibly high! I’m going to stick to the bigger higher volume shares and ETFs for now. I don’t actually plan to sell anything any time soon anyway, I just got worried with TM17 when it looked like I couldn’t get rid of it at all, as it made me realise if I had a more urgent need to sell I could be in trouble.

It’s the volume of trades which is of more concern to you rather than the volume of shares
T17 for example averages 100-200 trades a day. This isn’t too bad as some AIM stocks have even lower trade volumes

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