Overview

When you place an order to buy or sell investments, you might find that the price your order fills at is different from what you expected. Wealthsimple doesn't have any control over what price your order is ultimately executed at. Our executing brokers are legally obligated to fill your order at the best available price in the market.

If your order fills at a different price than expected, resulting in a negative cash balance in your account, there are a few reasons why this might happen:

You expected the last traded price instead of the bid and ask prices

The last traded price represents the last transaction a willing buyer and seller entered into for that security. While the last traded price may be helpful to gauge where the market is at generally, it is not necessarily still available as a live bid or offer anymore, and therefore may not be the actual price you will have your order filled at.

The bid and ask price refers to the highest price that a buyer is willing to pay for the asset (the bid), and the lowest price that a seller is willing to part with their shares (the ask) at that particular moment in time.

How the bid and ask spread works

When you submit a market buy or market sell, your order looks to pair with a buyer at the quoted price. If it's not able to do so, it will execute at the next best available price.

As a result, the quote is an indicator but does not guarantee the price at which your order will fill. It provides an approximation based on the last known trade for a board lot.

You're comparing with non-consolidated market price data

If you're comparing prices between your Wealthsimple self-directed investing account and an external market data provider (e.g. Yahoo or Google Finance), it's likely that the prices won't match.

Wealthsimple shows prices from the feed of one market data provider instead of showing a consolidated market price. Market orders are filled by various executing brokers on a handful of different feeds, which means that the price of a stock at a particular point in time will be different depending on the data source.

You observed a crossed market condition

Occasionally, during periods of high market volatility, you might see what appears to be an unusual price situation where the bid price is higher than the ask price. This is known as a "crossed market."

How crossed markets work

Crossed markets are rare and temporary situations that can occur during extremely fast trading conditions or in illiquid markets. When markets are highly volatile, rapid price movements can sometimes cause bid prices to temporarily exceed ask prices.

These situations typically resolve themselves very quickly as market makers and electronic trading systems adjust.

Crossed markets or inaccurate market data are generated at the exchange level and are outside of Wealthsimple's control.

Placing sell orders during crossed markets:

• If you place a market sell order during a crossed market, the proceeds you receive may be significantly different from the estimated amount shown.
• If you place a limit sell order that’s too far from the displayed market price (which may be inaccurate during crossed conditions), we may not accept the order due to our risk limits that ensure a marketable limit price is submitted as required by our executing brokers.

You submitted an ‘odd lot’ order

Quotes for most securities are made based on a standardized number of units (usually 100, referred to as board lots). If you submit an order for an odd lot of shares, your order will only be filled based on the National Best Bid or Offer (NBBO). The NBBO may not match a specific quote provider’s data, as the NBBO takes into account all protected markets the symbol trades on, whereas a quote provider may only consider the data on one exchange.

The TSX and TSX-V consider the below order sizes to be board lots, anything that is outside of this would be considered an odd-lot.

US markets (NASDAQ, NYSE etc.) consider 100 shares to be a board lot regardless of the price.

For example, if an order is submitted for 150 shares of stock XYZ that closed yesterday at a price of $5.00 per share. 100 shares would be considered a board lot and the remaining 50 would be considered an odd-lot.