As previously notified, the Australian Securities and Investments Commission (ASIC) has announced changes in conditions on the issue and distribution of contracts for difference (CFD) to retail clients.
These changes for retail clients will come into effect on 29 March 2021. ACY Securities Pty Ltd (ACY AU), will be fully complying with these new regulatory requirements:
• Revised leverage limits will be as follows:
o 30:1 for CFDs referencing an exchange rate for a major currency pair.
o 20:1 for CFDs referencing an exchange rate for a minor currency pair, gold or a major stock market index.
o 10:1 for CFDs referencing a commodity (other than gold) or a minor stock market index.
o 5:1 for CFDs referencing shares or any other underlying assets.
o 2:1 for CFDs referencing crypto-assets.
• Negative balance protection limiting client's aggregate liability for all trades connected to an account to the funds available on that account.
• Margin close out protection where margin close out will occur when the sum of funds in your account and the unrealised net profits and losses of all open trades connected to that same account, fall to less than half of the total initial margin protection required to open trades. This is consistent with ACY AU's current margin close out policy so there is no change here for ACY AU's clients.
• Prohibition of promotional offers such giving or offering certain inducements to retail clients to open or trade (e.g. offering gifts like iPads).
The above changes do NOT apply to sophisticated clients or wholesale clients. If you think you may be eligible to be a sophisticated client or wholesale client and would like to apply to be categorised as an Experienced Trader, you can elect to do so in your acy.cloud portal. You'll need to answer several questions and provide documentation, so that we can assess whether you fulfil the eligibility criteria.
For retail clients that are holding open positions, please monitor and manage your positions accordingly. Reduced leverage means you may need to have sufficient funds in your account to meet increased margin obligations.
Click play on the video below to learn more.
Please note - this announcement is applicable to clients of ACY AU only.
