Bid/Offer spreads

PAG2 104.6 - 107.20
LAD2 100.6 - 102.55

Those spreads are obscene! Who is going to trade at those spreads?


  • Frankly, no-one! Just checked PAG2 and the current "real" buying price is a touch over 105, so fairly respectable spread in reality.
  • LAD2

    Trades today
    Time/Date Price Volume Trade Value Type
    15:21:49 22-Jun-2015 102.18 19,000 19,414.20 Cancelled
    15:11:17 22-Jun-2015 101.55 10,000 10,155.00 Cancelled
    15:04:02 22-Jun-2015 102.20 5,000 5,110.00 Ordinary trade
    13:04:11 22-Jun-2015 101.55 10,000 10,155.00 Ordinary Trade - delayed publication
    13:04:11 22-Jun-2015 101.55 10,000 10,155.00 Ordinary Trade - delayed publication
    09:44:55 22-Jun-2015 101.45 2,000 2,029.00 Ordinary Trade - delayed publication
    08:55:06 22-Jun-2015 102.18 11,700 11,955.06 Ordinary Trade - delayed publication

    Reviewing today's trades, one could guess there were 2 buys at 102.20 & 102.20, remaining ones being sales @ 101.45 & 101.45. Not always easy to determine. I tend to ignore the official spreads as per the LSE, not too sure how they can provide accurate data for bonds which are not traded every minute! Therefore the spreads are far narrower than officially indicated.
  • The question is, when you trade are you actually trading with a retail counterparty or with a market maker?
    When you trade bonds on Borsa Italiana, the order is accepted by the market and you can actually see it placed in the bid/ask ladder with all others.
    Being part of the same Group, I though it was the same on LSE but no order book is published there. Is it not that you are actually trading with Canaccord, Killik, Investec and paying a margin to them?
  • I wonder if we'll ever have a bond exchange that operates in the manner that the betting exchanges work.
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