Risk Disclosure

The Company’s official language is English. To get a more thorough understanding of the Company's activities, please check the English version of the website. Any information translated into languages besides English is meant solely for informational purposes and holds no legal validity; the Company is not liable for the accuracy of the information presented in other languages.

Disclosure of risks related to transactions involving foreign currency and derivatives

This brief warning, serving as an addition to the General Business Terms, is not meant to cover all risks and other critical elements associated with dealings in foreign currency and derivatives. Given the risks involved, you should avoid engaging in transactions involving these products if you do not understand the nature of the contracts you are entering into, the legal implications of such relationships within the context of those contracts, or the level of your risk exposure. Trading in foreign currency and derivatives carries a significant level of risk, making it unsuitable for many individuals. You need to carefully assess the extent to which such operations align with your profile, considering your experience, objectives, financial capacity, and other significant factors.

Transactions involving foreign currencies and derivative instruments

1.1 Leveraged trading signifies that potential profits are amplified; however, it also means that losses can be amplified. A lower margin requirement equates to a higher risk of potential losses if the market shifts against you. At times, margins can be as low as 0.5%. It is crucial to understand that when trading on margin, your losses could surpass your initial investment, possibly resulting in a loss far exceeding the amount you initially put in. The initial margin amount might appear minor relative to the worth of the foreign currency contracts or derivatives, given that the 'leverage' or 'gearing' effect is involved in the trading process. Minor market fluctuations can have a proportionally greater impact on the amounts you have deposited or plan to deposit. This situation can either be advantageous or disadvantageous for you. While maintaining your position, you might sustain losses equal to the initial margin and any additional funds deposited with the Company. If the market begins to trend against your position, or if the required margin increases, the Company may demand that you urgently deposit extra funds to uphold the position. If you fail to meet the request for additional funds, the Company may close your positions, and you will be responsible for any resultant losses or insufficient funds related to this.

1.2 Strategies and Orders for Minimizing Risk

The placement of specific orders (such as "stop-loss" orders, if permitted by local laws, or "stop-limit" orders), designed to limit potential losses, can become ineffective if the market conditions prevent the execution of these orders (for instance, during market illiquidity). Moreover, strategies that involve a combination of positions, like "spread" and "straddle," might carry risks just as high as those associated with standard "long" and "short" positions.

2. Unique risks related to dealings involving foreign currency and derivatives

2.1 Requirements for entering into agreements

It is essential to gather comprehensive information from your broker regarding the terms for entering into contracts and any associated obligations. This includes details about situations where you might be required to fulfill or accept delivery of an asset as part of a futures contract, or for options, specifics about expiration dates and deadlines for exercising those options. In certain scenarios, a stock exchange or clearinghouse may alter the requirements of outstanding contracts, including the strike price, to align with market fluctuations of the relevant asset.

2.2 Suspension or limitation of trade. Price relationship

Certain market conditions (such as liquidity) and/or the operational rules of specific markets (for instance, suspension of trading for certain contracts or contract months due to exceeding price change limits) can heighten the risk of losses. This is because executing trades or closing out/netting positions can become challenging or even unfeasible. If you sell options, your losses could escalate. A solid connection between the prices of the asset and its derivative does not always exist. Moreover, the lack of a benchmark price for an asset may complicate the estimation of its "fair value".

2.3 Funds and property that have been deposited

It is important to understand the protective instruments related to the Security you have deposited, whether in cash or other assets, while carrying out transactions, both domestically and internationally, especially in cases where insolvency or bankruptcy of a trading firm may arise. The degree to which you can retrieve your cash or other assets is governed by the laws and local regulations of the country where the Counterparty operates.

2.4 Fees for commissions and additional charges

Before engaging in any trades, it is essential to understand all the commission fees, payments, and other charges you will be responsible for. These costs will impact your overall financial outcome (whether profit or loss)

2.5 Transactions in other jurisdictions

Carrying out transactions in markets located in other jurisdictions, including those linked to your internal market, could expose you to extra risks. The way these markets are regulated might vary from your market, potentially offering less investor protection. Your local regulatory authority cannot guarantee that the rules set by regulatory bodies or markets in other regions where you conduct transactions will be strictly followed.

2.6 Currency risks

The profits and losses from transactions involving contracts that are redenominated in a foreign currency, which is different from the currency of your account, are influenced by exchange rate changes when converting from the contract currency to the account currency.

2.7 Liquidity risk

Liquidity risk impacts your ability to trade. It is the risk that your financial contract or asset cannot be traded when you wish to trade (to avoid a loss, or to secure a profit). Furthermore, the margin required to be held as a deposit with the contract provider is adjusted daily based on fluctuations in the value of the underlying assets of the contract you own. If this adjustment (revaluation) results in a decrease in value compared to the valuation from the previous day, you will be obligated to provide cash to the financial contract provider right away to restore the margin position and cover the loss. If you are unable to make this payment, the financial contract provider may close your position regardless of your agreement to this action. You will be responsible for the loss, even if the price of the underlying asset eventually recovers. Some financial contract providers will liquidate all your contract positions if you lack the necessary margin, even if one of those positions is currently profitable for you. To maintain your position, you may need to consent to let the financial contract provider take additional payments (typically from your credit card), at their discretion, when margin calls arise. In a rapidly moving, volatile market, you can easily accumulate a substantial credit card bill in this manner.

2.8 "Stop loss" limits

To minimize losses, numerous financial contract providers allow you to set 'stop loss' limits. This feature automatically closes your position once it hits a price threshold that you select. However, there are situations where a 'stop loss' limit may not be effective, such as during quick price fluctuations or when the market is closed. It's important to understand that stop loss limits do not guarantee protection from all losses.

2.9 Execution risk

Execution risk refers to the possibility that trades will not occur instantly. For instance, there could be a delay between when you submit your order and when it gets executed. During this delay, the market may shift unfavorably for you. This means your order might not be filled at the expected price. Some contract providers permit trading even when the market is shut. However, it's important to note that the prices for these trades can vary significantly from the closing price of the underlying asset. Often, the spread may be larger than when the market is actively open.

2.10 Counterparty risk

Counterparty risk refers to the possibility that the entity offering the CFD (your counterparty) might default and fail to fulfill its financial commitments. If your funds are not adequately separated from those of the CFD provider, and if that provider encounters financial problems, you could risk not recovering any money owed to you.

2.11 Trading systems

Most standard "voice" and electronic trading systems rely on computer devices for order routing, operations balancing, and transaction registration and clearing. Like other electronic devices and systems, they can experience temporary failures and malfunctioning. Your potential for recovering certain losses might be influenced by the liability limits set by the trading systems' provider, markets, clearinghouses, and/or dealing firms. These limits can differ; therefore, it is important for you to obtain comprehensive information from your broker regarding this issue.

2.12 Electronic trading

Trading conducted through any Electronic Communications Networks can vary not only from trading in a traditional "open-outcry" market but also from trading in other electronic trading systems. When you carry out transactions on an Electronic Communications Network, you assume the unique risks associated with that system, including the potential for hardware or software failures. Such system failures could lead to several outcomes: your order might not be executed according to your instructions, an order may go unfulfilled entirely, it might become difficult to consistently receive updates about your positions, or you may struggle to fulfill margin requirements.

2.13 Over-the-counter operations

In several jurisdictions, companies can conduct over-the-counter transactions. Your broker might serve as the counterpart in these transactions. The unique aspect of these transactions is the difficulty or impossibility of closing positions, assessing values, or establishing the fair price or exposure to risk. Due to these reasons, these transactions may involve heightened risks. The regulations that manage over-the-counter transactions might be less stringent or offer a specific regulatory framework. It is essential that you understand the rules and risks associated with these operations before engaging in them.