ESMA has agreed a range of product intervention measures to restrict the provision
of CFDs (including rolling spot FX) to retail clients.
The changes from ESMA are:
- Maximum leverage limits on new positions:
- 30:1 for major currency pairs
- 20:1 for non-major currency pairs, gold and major indices
- 10:1 for commodities other than gold and non-major equity indices
- 5:1 for individual equities and other reference values
- 2:1 for Cryptocurrencies
- A standardised 50% margin close out rule on an account level basis
- Negative balance protection on an account level basis
- A prohibition on firms offering monetary and non-monetary benefits (excluding research and information tools)
- A standardised risk warning which includes firm specific figures on the percentage of client accounts that have lost money trading CFDs.
These measures will come into effect on 1st August 2018.