Behind the scenes: Sharesies’ process for Australian investments—Sharesies Australia
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Behind the scenes: Sharesies’ process for Australian investments

Explainers

Let’s take a look into what typically happens when you place a buy or sell order for investments listed on the Australian Securities Exchange (ASX) through the Sharesies’ platform. We’ve also covered how this process works for NZ orders and US orders.

15 November 2021

4 min read

Behind the scenes: Sharesies’ process for Australian investments

Step 1: You place your order 🙌

This is the bit that you see! You might be buying a new investment, or selling an existing one. Once you’ve placed your order, it’s received by Sharesies.

Step 2: Your order goes through Sharesies’ market service 🍍

When you place an order, it goes to Sharesies' market service system first. The market service considers a few key things, including whether the ASX is open.

The ASX is usually open between 10 AM to 4:11 PM AEST, Monday to Friday (this might change over public holidays). You can see exact trading hours for the week ahead by looking at an ASX-listed investment in Sharesies.

You may be wondering where the extra 12 minutes are coming from! This is because Australian orders participate in two extra auction phases:

  1. Pre-open: orders for Australian shares can be queued to be placed on the market. But, your order won’t fill until it matches with a buyer or seller when the market opens. This auction is between 7 AM and 10 AM.

  2. Pre-close: orders can be placed during this time, and your order might be filled if there’s a price match between a buyer and seller. This auction usually happens between 4 PM and 4:11 PM.

Outside of these specific pre-trading, or trading hours, your order won’t be sent to market until it reopens.

Step 3: Your order is sent to CMC Markets 🐨

Sharesies works with CMC Markets Stockbroking Ltd (“CMC Markets”) to execute buy and sell orders for ASX-listed investments.

Your order is sent securely to CMC Markets, who place it on the market. CMC Markets will only see the orders as coming from Sharesies, not each individual investor. 

The ASX is typically ‘the market’ where companies list and buyers and sellers come together. It’s possible that your order may be filled on another trading exchange called Chi-X. This might happen when your order is able to be filled at a better price on Chi-X. The ASX and Chi-X are both regulated by the Australian Securities and Investments Commission (ASIC).

Step 4: Your order goes to market ✨

Your order gets placed on the market. Nice!

If you’ve placed a market order, the market will decide the price. If you’ve placed a limit order, you’ll have more control over the amount you buy or sell an investment for. Because your investments are held under a nominee Holder Identification Number (HIN) rather than under an individual HIN, you don’t need to meet the $500 minimum investment requirement that usually applies when investing on the ASX—Sharesies takes care of this part for you.

When your order goes to market, it might be filled in a single trade almost straight away, or over multiple smaller ‘partial’ trades and at different prices. If your order (or partially filled order) is waiting to be filled, it’s called a ‘processing order’. If your order isn’t filled after 30 days, it will be cancelled and the money becomes available again in your Sharesies Wallet.

Step 5: Your order appears in Sharesies! 🎉

When your order is filled, you’ll see your investments (if you’ve bought investments) or money (if you’ve sold investments) appear in Sharesies—you might be restricted from withdrawing any money until funds have been cleared. You’ll also be able to see a contract note that gives you all the info you need to know about your order and the trade that took place. Just remember that orders can sit on market for up to 30 calendar days to be filled—but, in many cases, your order can fill almost immediately. Some investments can be more illiquid, such as penny stocks, meaning it can take longer for an order to fill.

Behind the curtain, Sharesies is settling your order with CMC Markets. This basically means we need to pay CMC Markets the money for your order and receive your investment in return (and vice versa if you’re selling). This generally occurs on a T+2 basis—the ‘T’ stands for transaction date (the day the trade takes place) and ‘+2’ means plus two working days. We need to deliver money or shares to CMC Markets for your order within these two working days. We take care of this, and you don’t need to do anything on your end!

Lingering questions? 💡

We’re keen to hear them! Flick our Customer Care team an email at help@sharesies.com.au and we’ll be more than happy to help you out.


Ok, now for the legal bit

Investing involves risk. You aren’t guaranteed to make money, and you might lose the money you start with. We don’t provide personalised advice or recommendations. Any information we provide is general only and current at the time written. You should consider seeking independent legal, financial, taxation or other advice when considering whether an investment is appropriate for your objectives, financial situation or needs.

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