ESMA Announcement

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.

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