rather than pick out individual stocks to trade, it can often be worthwhile to trade the indices themselves, especially in times of high volatility.

for those so inclined, i attach below charts for FTSE and FTSE 250, though one might equally be tempted to trade Dow or S&P, which is significantly broader in its coverage, or even NASDAQ

for ease of reading, i have attached 1 year and 3 month charts in each instance

Shortie/Toya - when and how often is that levied - I don't recall seeing it before, "price adjustment" my eye!

EUR Industrial Production m/m 0.7% consensus 0.3% previous -0.7%

Skinny: yes, complete pain, and I never know when it's going to happen, though I think there is some logic to it somewhere. I've been caught out once before. But as Shortie says: if we'd been Long then we'd have had a nice bonus!

Well, I'll just have to earn that back - I thought things had been going too well recently...

I wonder if that explains my disparity in FTSE prices yesterday evening between IG & CMC just after our close?

I think that was the time it was applied Skinny - cos I remember that at around that time I thought I had plenty of margin and the next it seemed to have vanished!

It looks like it was applied @22:00 - I had the disparity much earlier - I must find out as and when it is levied - I don't recall having fallen foul of it before.

The money definitely went out of my account before 18:00 last night.

Skinny, this is the info gives on IG:

A ‘Dividend Adjustment’ refers to an adjustment we make to your account 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, we will credit the dividend adjustment to your account.

In the case of short positions, we will debit the dividend adjustment from your account.

Please note: Stock Index dividend adjustments will be posted to your account after market close the day before the ex-dividend date and will be based on an estimation of the dividend amount.

All the details above should be used for guidance only. Subject to the terms of any Corporate Action your positions could be treated and adjusted in a different manner without prior notice.

Ok - that looks like it is levied normally on a Tuesday evening - some big FTSE ex dividends today AZN, BP, RDSB etc.

If I knew about it - I've obviously forgotten now :-(

Here's a bit more info from IG. I have heard about 'Dividend Tuesday' so we should watch out in future! If you search on Google for that phrase you'll find loads of info.

What happens when a stock or index goes ex-dividend

When a company goes ex-dividend (that is, they pay a dividend to shareholders) the value of the share will generally fall by the same amount as the dividend. Since a stock index is made up of a number of companies, the fall in value of the shares will also cause a fall in the value of the index.

Why we make the adjustment

When the price of a stock or index drops after going ex-dividend, your running profit & loss (P&L) is affected. If you’re long, this means you miss out on potential profit. If you’re short, this means your P&L is better than it should be.

Given that the drop in price is an expected market movement, we must make an adjustment so that your P&L is not affected.

How we calculate the dividend adjustment

Adjustment = size of your position x dividend amount

The dividend amount will vary depending on the company or index. We usually use the dividend amount listed on Bloomberg.

When dividend adjustments occur

For the FTSE 100 we adjust our price on most Tuesday afternoons; some weeks there may be no adjustment needed. For the Wall Street its ad-hoc, so it could be every day.

Discussed accross the road on FX thread most weeks skinny.

With large companies such as 3M Co, Boeing, Chevron, Du Pont going ex-Dividend our adjustment factor was 22.92 for every £1 per point position.

If you have any further questions, please do not hesitate to contact us....


Caught out

Thanks Iain

Today's most important factor will be the US Retail Report at 13:30 (UK time):

'Economists polled by MarketWatch are estimating that retail sales were flat in January, versus a rise of 0.5% in December. It’s the first report to be released since taxes for millions of Americans rose. Markets are expected to be sensitive to any number that veers far north or south of projections.'

South for today please :-)

Skinny, DFT funding in my CityIndex account is applied at 22:00. In all honesty I've never bothered to try and workout when and how much this will be as there only applied to DFT trades not futures.

Shortie - as posted above, mine was also applied @10pm.

@19 x stake.

I'd either forgotten about it and/or not taken much notice before.

As I said, there are some big FTSE ex dividends today.

USD Core Retail Sales m/m 0.2% consensus 0.1% previous 0.3%

USD Retail Sales m/m 0.1% consensus 0.1% previous 0.5%

USD Import Prices m/m 0.6% consensus 0.8% previous -0.1%

Thanks Skinny. I could do with a nice drift south!

pretty much as expected though

Been stopped out now - and lost all the profit I made last week dammit. You can be pretty sure that 6360 is today's top!

Think I'll go out and play in the snow!