19 Jun 2015 Dear iTrader…
During this week while working on the Leaderboard for the #iTradeR1m challenge, we became aware that there is something wrong with the matching of the virtual trades. Buy and sell transactions were matched at prices that never traded in the real JSE. We discovered, thanks to a honest iTrader, that buy and sell orders entered “Good till cancelled” matched during the closing and opening auctions between 4:50 and 5 pm as well as 8:30 and 9 am. What happens in an auction is that JSE clients can enter any bid or offer without any risk of trading if they cancel that order just before 5pm. The JSE computer makes up a best price at 5 pm and all orders within that price then trade at that price. You can look at all the wild bids and offers in the auction time on your screen. For example Sasol was trading around R410 at the close. In the auction bids went as high as R440 and offers as low as R390. Due to a glitch in the Iress Virtual Trading System, open virtual orders were matched. If you bought Sasol and put in a sell order for R440 “Good till cancelled” in the hope it will reach that price in a week or two, it will match in the auction despite no trading at that price on the JSE. That is obviously unrealistic and unfair profit. The iTrader did nothing wrong, it was just a system error, but it caused unfair advantage for most if not all the leaders.
In light of the above and in order to run a fair competition for all, we have no other choice but to restart the competition. Rule 15 in the Terms and Conditions deal with auctions and prohibits trading during auctions, see here. There are too many trades to just reset them. The competition will now start afresh on Monday 22 June. Each iTrader will receive a clean R1m to start again. Please accept our sincerest apology for this mishap and please accept it as an extra week of practise. It is fortunate that the JSE moved mostly sideways from last Friday to now and not many iTraders are in profit. Most of those that are in big profits benefitted from these unrealistic profits on their orders that matched in the auction. We still apologise and hope you will take up the challenge again. Please feel free to email me directly on Head@SanlamiTrade.co.za.
Head – Sanlam iTrade Online