UT (Tax & Chancery) UT-2022-000134 UT-2022-000135 UT-2022-000137 - [2025] UKUT 00214 (TCC)

The Authority contrasted Mr Lopez’s otherwise diligent and cautious approach, being someone who managed his risk very carefully, with what they described as the speculative anticipatory hedges of 200 lots or more on the market, with no certainty over what client flow or the market would do next.

We do not see this point as being anything more than a challenge to whether the strategy existed. The examples relied upon by the Authority – F56, F63 and F132 (where the Small Orders were for five lots in the first two Instances and one lot in the third) do illustrate a submission made by Mr Jaffey namely that on the Authority’s case Mr Lopez was pursuing an abusive strategy in circumstances where the amounts at stake in the Small Orders, and thus to be gained, are very small, as the spread of one tick meant it would cost an additional €10 per tick for each lot to cross the spread and trade.