ESMA (EU) new regulations for CFDs and binary options to retail investors

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amando
791
amando  

Hello,

does anyone know a serious MT5 broker which do not use the new regulations in August for european customers?

thanks in advance

amando

MarkJoy
41
MarkJoy  

Just curious, what are these regulations about?

Tsvetan Tsvetanov
6614
Tsvetan Tsvetanov  
MarkJoy:

Just curious, what are these regulations about?

Maximum leverage 30:1 for the major pairs and 20:1 for the crosses and indexes.

Complete ban for binary options and broker bonuses.

amando
791
amando  
Fernando Morales:

if the broker is not applying new EU regulations I would not call it "serious"

Most EU brokers offer the 1:200 to professional traders. Alternatively, I advise you to relocate to AU or NZ

any ideas for brokers who offer mt5?

peterpies
7
peterpies  
Tsvetan Tsvetanov:

Maximum leverage 30:1 for the major pairs and 20:1 for the crosses and indexes.

Complete ban for binary options and broker bonuses.

Hi

Does this include MT4 and the UK?

Just check and it seems not applied to the UK, yet,


UK watchdog FCA annouced that the regulator supports ESMA’s proposed measures. FCA is expected to evaulate whether to apply ESMA’s proposed rules on the forex brokers under its regulation.


Although I like the ESMA's negative balance protection as madatory, although it will be reflected some where in the traders cost.

Tsvetan Tsvetanov
6614
Tsvetan Tsvetanov  
peterpies:

Hi

Does this include MT4 and the UK?

Yes. The UK is still part of EU and they have to comply with all regulations.

Eleni Anna Branou
Moderator
6598
Eleni Anna Branou  

Does anyone know if these new regulations apply to European based brokers or clients?

I asked my oveseas broker and doesn't know anything yet.

Enrique Dangeroux
410
Enrique Dangeroux  
Eleni Anna Branou:

Does anyone know if these new regulations apply to European based brokers or clients?

I asked my oveseas broker and doesn't know anything yet.

Most likely it is just like the GDPR, some aspects of this legislation are extra-territorial. IE It applies to all companies, offering service to or targeting EU citizens.

Eleni Anna Branou
Moderator
6598
Eleni Anna Branou  

ESMA has agreed on measures in relation to CFDs. The measures restrict the marketing, distribution or sale of CFDs to retail investors, by providing the following protections:

  • Leverage limits on the opening of a position between 30:1 and 2:1, which vary according to the volatility of the underlying asset:
    • 30:1 for major currency pairs;
    • 20:1 for non-major currency pairs, gold and major equity indices;
    • 10:1 for commodities other than gold and non-major equity indices;
    • 5:1 for individual equities and any underlying not otherwise mentioned;
    • 2:1 for cryptocurrencies;
  • A margin close-out rule on a per account basis;
  • A negative balance protection on a per account basis;
  • A prohibition on benefits and incentivising trading;
  • A standardised risk warning.

The leverage limits imposed on CFDs set the maximum leverage that providers can offer you when opening a CFD position.

With lower leverage limits investors are protected from certain risks.

CrisZind
445
CrisZind  
Tsvetan Tsvetanov:

Maximum leverage 30:1 for the major pairs and 20:1 for the crosses and indexes.

Complete ban for binary options and broker bonuses.

What a waste of direction from law makers to influence people towards depositing more money in their accounts and continue to lose because they don't know how to trade

Does anyone know a "someone interested in being a doctor" who started to work in a hospital with regulations as to perform suturing for beginners and let anyone with experience of more than 12 months perform larger operations!!

First thing you are asked if you want to work is "Send your CV with your education and where did you get it from" NOT "How many months of experience do you have"

This business continues to frustrate 

amando
791
amando  
Eleni Anna Branou:

I just found out that these new ESMA regulations apply to CFDs only, so there is no worry about normal forex trading.

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ESMA has agreed on measures in relation to CFDs. The measures restrict the marketing, distribution or sale of CFDs to retail investors, by providing the following protections:

  • Leverage limits on the opening of a position between 30:1 and 2:1, which vary according to the volatility of the underlying asset:
    • 30:1 for major currency pairs;
    • 20:1 for non-major currency pairs, gold and major equity indices;
    • 10:1 for commodities other than gold and non-major equity indices;
    • 5:1 for individual equities and any underlying not otherwise mentioned;
    • 2:1 for cryptocurrencies;
  • A margin close-out rule on a per account basis;
  • A negative balance protection on a per account basis;
  • A prohibition on benefits and incentivising trading;
  • A standardised risk warning.

The leverage limits imposed on CFDs set the maximum leverage that providers can offer you when opening a CFD position.

With lower leverage limits investors are protected from certain risks.

that is wrong,

maximum Leverage for Major Currency like EURUSD, GBPUSD, USDJPY is 30:1

CFD is only the headline

12
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