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400% spread increase Australian shares



I've noticed over the past 6 months a substantial deterioration in trading conditions here at IG markets.


A classic example is the spreads charged on ASX listed shares. They used to be 1 - 2 cents. Now IG markets has increased them to a whopping 4 cents. And this on the largest and most liquid companies such as BHP, Telstra, Woolworths!

An absolute joke.


Is this a permanent change, or can clients expect spreads to decrease back to more sensible and reasonable levels in the near future? 

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I just wanted to give an overview of how we price our shares markets. Given the Aus stock names I have started with the CFD and share dealing description, but have also included the Spread Betting description as well (for any UK community members). 


CFD and Share Dealing 

On a CFD and Share Dealing account the price you execute your trade at online will be exactly the same as you would get on the underlying market. This is the same across the ASX, LSE, NYSE, or any other exchange. On top of this we then charge a separate commission. You can see all fees for a CFD account here, and share dealing here. Therefore, if there is a wider spread, or a large value between the Buy and Sell price, then this is due to a larger spread in the underlying market.


There is also a new pricing model called 'Derived Pricing' if you don't have live data permissions, however this doesn't effect the execution level, but instead the display values (so we can offer as close to live pricing as possible, in real time, for free).


Spread Betting

We take the real time underlying share price, and wrap a small spread around it. For ASX shares as you mentioned, this is 0.1%, with more information available here. Once again, a large difference in the underlying share price would relate to a wider spread on the IG platform. 


I hope this clarifies things - let me know if you have any other questions. 

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Thank you for your response James.


I now see that I'm receiving derived pricing, which was unexpected, given that I assumed I had a subscription for a live ASX feed. This however seems to have been reset.


I have also noted some changes to the ASX live feed available rebate. Previously this rebate was available after executing 4 trades per month I believe.

Can you confirm that this is now no longer the case?


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