FXOpen AU announces US share CFD offering

Rick Steves

The Australian Securities and Investments Commission (ASIC) has recently imposed new leverage limits for retail clients, but FXOpen’s Pro Account is exempt from the new rules.

ASIC-regulated retail FX and CFDs broker FXOpen has expanded its trading offering to include over 100 US shares to trade as CFDs on an ECN account, for its Australia-based customers.

The announced offering addresses the growing demand from its customer base following FXOpen’s first launch of equity CFDs last year in the United Kingdom, through its FCA-regulated firm.

Gary Thomson, Chief Operating Officer at FXOpen UK, said: “We’ve seen an increased uptake in equity trading in recent months within our UK brokerage and are delighted to widen the reach of equity markets to the wider FXOpen group.”

The Australian Securities and Investments Commission (ASIC) has recently imposed new leverage limits for retail clients.

The maximum CFD leverage available to retail clients will range from 30:1 to 2:1, depending on the underlying asset class:

30:1 for CFDs referencing an exchange rate for a major currency pair
20:1 for CFDs referencing an exchange rate for a minor currency pair, gold or a major stock market index
10:1 for CFDs referencing a commodity (other than gold) or a minor stock market index
2:1 for CFDs referencing crypto-assets
5:1 for CFDs referencing shares or other assets
Brokers will also have to standardize CFD issuers’ margin close-out arrangements that act as a circuit breaker to close-out one or more a retail client’s CFD positions before all or most of the client’s investment is lost. Protection against negative account balances and end all trading credits, rebates, or gifts to customers.

Before now, a retail investor’s CFD exposure could be as much as 500 times their original outlay. This is expected to result in a drop in operating revenues for retail CFD brokers as it happened in other jurisdictions which have made similar changes, such as the European Union and the United Kingdom.

ASIC also targets CFD product features and sales practices that amplify retail clients’ CFD losses, such as providing inducements to become a client or to trade, which is also in line with the recent CFD product intervention by ESMA.

Violations of the new CFD products may result in a maximum of five years’ imprisonment for individuals and pecuniary penalties of up to $555 million for corporations.

Retail clients will have the right to recover the amount of loss or damage suffered because of any given product contravention made by a broker.

Most retail brokers offering CFD products have updated their processes and announced the changes to their clients while reminding them that Professional Accounts are exempt from the new ASIC rules.

Read this next

Retail FX

Banxso announces 8.7% interest rate on deposits in South Africa

“With Banxso, they can enjoy the benefits of both worlds – earning competitive interest and having the freedom to trade, all within the same platform.”

Industry News

FINRA to publish transaction details in U.S. Treasury securities

“Consistent with our longstanding practice, FINRA is introducing greater transparency in a calibrated and careful manner, benefiting liquidity and resilience in this critical market while also mitigating potential information leakage concerns.”

Institutional FX

OpenYield launches “cheap and easy” fixed income trading for brokers

“We’re on a mission to make bonds cheap and easy to trade, and are excited about the opportunity to build generational capital markets infrastructure.”

Digital Assets

Sumsub and Mercuryo publish a guide for VASPs: “Mastering Travel Rule Compliance”

“At Sumsub, we’ve concentrated our efforts on filling the gap in understanding the complexity of Travel Rule regulation and helping organizations find the best solution to stay safe and compliant while minimizing costs and avoiding potential risks of non-compliance. This guide we created with Mercuryo, our trusted partner, is the ultimate navigation tool all VASPs can consult.”

Digital Assets

Bitget Wallet Leads with Record Swap Volume & New Crypto Innovations

This week, Bitget Wallet achieved a milestone by surpassing Metamask with a record 388,757 Swap order transactions, securing the global lead. The significant 7-day trading volume, almost 68,000 more than its rival, underscores its liquidity and user trust. This robust activity signals Bitget Wallet’s prominent role and reliability in the dynamic crypto market.

Digital Assets

Embarking on a Digital Currency Journey

Imagine you’ve stumbled upon a treasure map, leading you to untold riches hidden in the vastness of the internet. Instead of gold coins and jewel-encrusted goblets, this treasure comes in the form of digital currencies, the modern-day loot coveted by many.

Reviews

Traders Union Experts Share The Trading Analyst Review For 2024

Navigating options trading in rapidly shifting markets poses a considerable challenge. This is where options trading alert services become invaluable. They aid traders in keeping abreast of evolving opportunities and market trends. In this assessment, Traders Union experts scrutinize The Trading Analyst alert service to ascertain its efficacy. 

Digital Assets

BlockDAG’s Presale Achieves $9.9M: Aiming For A 5000-Fold ROI As Cardano’s Price Rises And Fantom Launches Sonic

Explore Cardano’s surge, Sonic’s efficiency, and why BlockDAG’s growth makes it the top crypto choice. A deep dive into the future of blockchain investments.

Digital Assets

US, UK probe $20 billion Tether transfers tied to Russian exchange.

U.S. and UK authorities are investigating the movement of $20 billion in the USD-pegged stablecoin tether (USDT) through Moscow-based exchange Garantex.

<