Risk Warning: Your Capital is at risk & losses can exceed your deposits.
Contracts for Difference (“CFDs”) are leveraged products and carry a high level of risk to your capital as prices may move rapidly against you. Losses can exceed your deposits and you may be required to make further payments. These products may not be suitable for all clients therefore ensure you understand the risks and seek independent advice.
Trading in Financial Instruments always involves a risk. As a general rule, you should not therefore trade in Financial Instruments if you do not understand the products and the risks associated with them.
A CFD – or Contract for Difference – is speculation in changes in values. This Financial Instrument allows the Client to speculate in future increases or decreases in the value of a specific Underlying Asset, for instance Currency Pairs, equity indices, metals, commodities and forwards. If the Client’s speculations prove to be correct, he will make a profit from the difference in value (less costs), but he will have to pay the difference in value (plus costs) if his speculations turn out to be wrong.
CFDs available with the Company are always margin traded are margin traded, allowing the Client to take a larger position than he would otherwise be able to based on his funds. So, a relatively small movement in the Underlying Market can have a disproportionately dramatic effect on the Client’s trade. If the Underlying Market movement is in the Client’s favor, the Client may achieve a good profit, but an equally small adverse market movement can not only quickly result in the loss of the Clients’ entire deposit, but may also expose the Client to a large additional loss. CFD trading therefore involves a relatively high level of risk.
CFDs trade within wide intraday ranges with volatile price movements. Therefore, the Client must carefully consider that there is a high risk of losses as well as profits. The price of CFDs is derived from the price of the Underlying Asset in which the CFD refers to. CFDs and related Underlying Markets can be highly volatile. The prices of CFDs and the Underlying Assets may fluctuate rapidly and over wide ranges and may reflect unforeseeable events or changes in conditions, none of which can be controlled by the Client or the Company Under certain market conditions it may be impossible for a Clients order to be executed at declared prices leading to losses. The prices of CFDs and the Underlying Asset will be influenced by, amongst other things, changing supply and demand relationships, governmental, agricultural, commercial and trade programs and policies, national and international political and economic events and the prevailing psychological characteristics of the relevant market place.