Share spread bet product details

Dealing spreads on shares and ETFs are subject to variation, especially in volatile market conditions or in other unusual circumstances. Bets are opened and closed at the market bid/offer, adjusted for the contract month in the case of quarterly bets, minus/plus half our spread. Market spreads can widen significantly, particularly at the beginning and end of the trading day, and minimum spreads may exist.

Our spread for a particular share or ETF is calculated as a percentage of the current price.

Our 'all-in' spread on all individual share and ETCF options will include both our spread and market spread. This applies to both opening and closing transactions. No spread is charged on option bets which are left to expire. The size of the spread varies, depending on the option premium, the time to expiry and the volatility and liquidity of the underlying stock or ETF.

When you open a share spread betting position with us, it will be aggregated with other IG clients' positions in the same market. We do this to keep our hedging costs down, and to provide you with competitive spreads. IG’s brokers may also aggregate IG client positions with their other clients’ positions where it is a regulatory requirement for them to so (in the US for example).

By IG aggregating its client positions, you may be able to ‘go short’ even when there’s no borrowable stock available in the underlying market. This does, however, mean that when your order interacts with the underlying market, its treatment by brokers and/or exchanges will be based on the net aggregate position (ie the aggregate of all client and hedged positions) rather than your own. This also applies in the case where our brokers aggregate IG client positions with their other clients’ positions for regulatory reasons.

In certain situations this may have an impact on the outcome of an order. For example, if the net aggregate position is short in a specific market and you’re closing a long position in the same market, we’ll treat your order as a short-sell. In cases like this, your order will be subject to exchange rules on naked short-selling, uptick rules and short-sale restrictions – please refer to our ‘notes’ section for more information.

Notes:

Naked short-selling occurs when a trader attempts to short without first securing borrowable stock. We generally don’t allow clients to go short when borrowable stock is difficult to obtain. All short positions do, however, carry a risk of recall should borrowable stock later become unavailable

Uptick rules prevent rapid sell-offs, and stipulate that short-selling may only occur once the price of a particular market has ‘ticked up’

Short-sale restrictions promote market stability by prohibiting the short-selling of stocks which have declined by a certain percentage in a trading session

Guaranteed stop bets are available on certain shares at our discretion.

Guaranteed stop bets may not be available on certain stocks; please ask our dealers for current information.

The guaranteed stop premium for bets on UK shares depends on the volatility of the share concerned. We will classify a UK share as having a low, medium or high volatility and the premium will vary accordingly. We will maintain up-to-date lists of guaranteed stop premiums for individual shares.

For retail clients, the minimum margin factor for spread bets and CFDs on all shares is 20% of the share price. Please note that tiered margins apply; this means that more margin may be required for large positions. Please see our margins page for more details.

The margin required for 'buying' a share option is the opening level times the size of the bet. For 'selling' a share option, the margin required is the same as an equivalent equity position.

Minimum bet sizes in pounds, dollars and euros apply, for both quarterly and daily funded bets (DFBs). Please see the individual stock contract details for more information. For bets on share options, the minimum bet size is £10/point for UK share options, and $5/point for US share options.

Dealing hours are as follows:

UK Shares (LSE): 08.00-16.30 (London time)

American Shares: Typically 09.30 to 16.00 (New York time).
For some US shares, we offer extended trading hours from 04.00 to 20.00 (New York time) on Monday to Thursday and 04.00 to 17.00 (New York time) on Friday.

European Shares: Market hours for the relevant Exchange. Please ask for current details.

All other shares: Market hours for the relevant Exchange. Please ask for current details.

The contract months for quarterly bets rotate on a March, June, September, December cycle. The contract months for a UK share option will normally be the same as the contract months for the equivalent option quoted on LIFFE.

The last dealing day for quarterly bets is the Tuesday before the third Wednesday of the contract month. The last dealing day for UK share options is the third Friday of the contract month. The last dealing day for US share options is the third Friday of the expiry month or the previous business day if this is a market holiday.

For all shares quarterly bets, unless expressly agreed otherwise with IG, positions will be rolled over to a later date by default. Where a client has agreed with IG to expire a position, it will do so on or after the last dealing day basis the closing bid price (in the case of long positions) or closing offer price (in the case of short positions) of the relevant exchange on the last dealing day, plus or minus half of our spread.

When a bet is of sufficient size that an equivalent transaction on the exchange would be in excess of four times normal market size (or where any number of bets are together in excess of four times normal market size) then bets not already closed by the client by the last time for dealing will be automatically rolled over, unless we exercise our reasonable discretion to close the bet.

Bets on share options not already closed by the client are closed on or after the last dealing day for those share options, on the following basis:

• Bets on call options at the closing price of the underlying share as quoted on the primary exchange on the last trading day, less the strike price, or at 0, whichever is greater. The price used will be the closing price as quoted on the primary exchange.

• Bets on put options at the strike price, less the closing price of the underlying share as quoted on the primary exchange on the last trading day, or at 0, whichever is greater. The price used will be the closing price as quoted on the primary exchange.

DFBs, which do not have a daily rollover, have an interest adjustment applied daily to their account. Interest adjustments in respect of long positions is debited from a client's account and interest in respect of short positions is either credited or debited from a client's account.

The interest adjustment on a DFB is derived from the current one-month interbank offered rate of the currency of the share in which you are dealing, adjusted for our funding.

For example, if you are taking a long DFB position on a UK-listed share priced in sterling, the interest adjustment is calculated by adding the latest SONIA rate to our funding adjustment, usually 2.5% per annum. So, if SONIA is 1.5%, the total daily interest adjustment to a long position would be 0.011% (1.5% + 2.5% ÷ 365).

Conversely, if you are taking a short DFB position on a UK-listed share priced in sterling, the total interest adjustment is calculated by subtracting our funding adjustment, usually 2.5% per annum, from SONIA. Unlike long positions, the total interest adjustment on short positions can result in either a higher or lower opening level. If SONIA is greater than our funding adjustment, the opening level will be higher than the closing level. If SONIA is less than our funding adjustment, the opening level will be lower than the closing level.

For example, if SONIA is 4% (greater than our funding adjustment), the interest adjustment to a rolled DFB short position would be 0.004% (4% - 2.5% ÷ 365). If SONIA is 1.5% (less than our funding adjustment fee), the daily interest adjustment to a rolled DFB short position would be -0.0027% (1.5% - 2.5% ÷ 365).

Note that when you are shorting a stock via a DFB spread bet, you will incur a borrow charge. The borrow charge will be accounted for in a daily cash adjustment applied to the account. The charge varies according to the stock, is notified to us by our brokers or agents and includes a 0.5% administration fee. The borrow charge, and the ability to hold a short position, can be changed at short notice. To determine whether a borrow charge applies and if so, what the charge is, call our dealers in advance of betting.

A dividend adjustment is applied when a share passes its ex-dividend date (including the ex-date of any special dividend) in the underlying stock market. In the case of long positions, the dividend adjustment is credited to the client's account. In the case of short positions, the dividend adjustment is debited from the client's account. In the case of UK shares, the dividend adjustment is equal to the amount of the net dividend. The dividend adjustment for shares in other markets varies depending on local tax arrangements; please ask our dealers for current details.

For all shares quarterly bets, unless expressly agreed otherwise with IG, positions will be rolled over to a later date by default. For most positions, a client can, before the position has been automatically closed, ask for the position not to be rolled over to a later date. Rolling over a position involves closing the old position and opening a new one. We normally attempt to contact a client shortly before a position is due to expire and offer the opportunity to roll the position over. However, we cannot undertake to do this in every case, and it remains the client's responsibility to communicate their roll preferences for any position(s) before expiry. Bets on share options cannot be rolled over.

When a quarterly shares bet is rolled over to the next quarter, the expiring bet is closed at the middle of the market price after the close of the relevant exchange, plus or minus our normal closing spread as shown in the ‘our spreads explained’ tab. A new position will be opened in the following contract, basis the same underlying market price, adjusted for interest and IGs opening spread. No market spread is applied to either the open or the close.

If you have a stop or a limit order on a daily position when it is rolled over, we will, unless instructed otherwise, place the stop on the new bet at the same level as the stop on the expiring bet.

If you have stops or limits on a quarterly bet when it is rolled over, we will, unless otherwise instructed, place the stop or limit on the new bet at the same level, but adjusted for fair value. For example, if the price of the new contract is 20 points higher than the expiring contract, your stop or limit would be rolled forward at your existing level plus 20 points. This applies to both guaranteed and non-guaranteed stops and limits.

If there is a bonus share issue, special dividend, rights issue, or any other event making it appropriate by normally accepted standards to adjust the opening level or size of a bet, we will make whatever adjustment it believes to be fair and reasonable. We will always attempt to replicate the rights and adjustments afforded to shareholders or the underlying stock when adjusting a spread bet. Please be aware that, with certain corporate actions such as entitlements or rights issues, those clients who have shorted a stock (made a down bet) will not have the option to take up the rights or entitled shares and may be assigned a larger position in terms of pounds, or any other currency, per point.

If you have an open guaranteed stop share spread bet where the underlying share is subject to a rights issue or open offer and the subscription price is (a) in or at the money at the closing price of the underlying share on the last trading day for that share immediately before the ex-date, we will treat the rights issue or open offer as being successful and accordingly increase the size of your bet to reflect the effect of the rights issue or open offer or (b) out of the money at the closing price of the underlying share on the last trading day for that share immediately before the ex-date, we will treat the rights issue or open offer as not being successful and accordingly leave the size of your bet unchanged. This treatment will apply regardless of whether a rights issue or open offer becomes successful after being out of the money at the closing price of the underlying share on the last trading day for that share immediately before the ex-date or is not successful after being in or at the money at the closing price of the underlying share on the last trading day for that share immediately before the ex-date. Importantly, in both situations, we will alter the level of your stop such that the maximum amount you are risking under this open share spread bet remains the same before and after any adjustment is made for the rights issue or open offer.

Typically when there is an element of choice in a corporate action, the choice is usually only extended to those who have invested in (bought) the stock. For share spread bets in a company which is under offer in a takeover situation, once the offer goes wholly unconditional, we will treat the share spread bets as if they have been assented unless otherwise instructed. If you go short of a stock, any rights or other entitlement may be exercised against you. With regard to equity options, we will take note of any adjustment made by the relevant options exchange in respect of options on the affected share.

In the unlikely event of a dispute, a client may ask our regulator the Financial Conduct Authority (FCA), or any successor, to arbitrate. We will take whatever action it considers fair and reasonable if a share is suspended, but a client may ask the FSA to arbitrate in the event of a disagreement.

There are four different types of price feed offered on equity markets across the platform: delayed, derived, level 1 and level 2.

In most cases, the delayed price feed is delayed by 15mins, although in some cases it may be 20 mins. The length of the delay is indicated by a small icon containing the number 15 or 20 next to the update time for that instrument. The delayed price feed is free, and is the default offering across all equity instruments unless a real-time free option is available - such as pricing from multilateral trading facilities (MTFs) or derived prices. Markets that show a delayed price will display a ‘start live data’ button in their deal tickets. Clicking this button will change the visible price to a live price for up to ten price updates, before reverting to a 15 or 20 minute delayed price.

Derived prices are real-time prices created from the underlying exchange price. Derived prices have been adjusted in such a way which makes them non-reverse-engineerable, an exchange requirement which allows IG to distribute real-time data without having to charge clients. The adjustment is purely for display purposes and does not affect the execution of trades placed on markets which display derived prices.

Level 1 data is the real-time feed of the top level of the exchange order book. Level 1 data can only be viewed if non-free data is activated in the ‘data feeds’ section of the platform. A monthly fee is charged if activated.

Level 2 data is the real-time feed of the top five levels of the exchange order book. Level 2 data also requires activation, incurs a higher charge than Level 1 data.

For more information please log in to the platform and go to ‘help and support’ in the top-right corner. In the support portal, enter 'derived prices' in the search box.

Please note, our help and support portal is not available on the new IG Trading Platform.