RoboForex amends CySEC license to offer social trading in the EU

Rick Steves

Today it has been announced that Cyprus based FX firm RoboForex has applied an amendment to its Cypriot license that allows it to act as a Portfolio Manager. RoboForex Group had launched RoboTrade via the group’s proprietary platform earlier this year, offering Risk Allocation Management Model (RAMM) accounts, which is now licensed under the MiFiD […]

cysec

Today it has been announced that Cyprus based FX firm RoboForex has applied an amendment to its Cypriot license that allows it to act as a Portfolio Manager.

RoboForex Group had launched RoboTrade via the group’s proprietary platform earlier this year, offering Risk Allocation Management Model (RAMM) accounts, which is now licensed under the MiFiD rules, allowing the firm to offer these solutions to all European Union residents. The RAMM system is an inbuilt risk management system that calculates lot position automatically for optimization of profits.

Adding to the RAMM services, the company is now licensed to operate CopyFX, active since October 2014 in the social trading scene, offering copied traders up to 50% of investors’ profits. Copy and social trading have gained popularity ever since the introduction of Tradency’s Mirror Trader in 2005, rapidly followed by Zulutrade, eToro and others.

Following legal discussions among regulatory authorities, it has become widely accepted that social trading constitutes Portfolio Management, which requires a specific license.

RoboForex, which in addition to CySec licensing, has registration in Belize, used to be listed on the Financial Services Provider register in New Zealand since October 2012 under the name RoboForex LP, but two years later it moved all its clients to its new subsidiary in Belize, stating that the move had to do with its global growth plans.

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The New Zealand Financial Markets Authority (FMA) had established the FSP register in late 2010, opening up great possibilities for new companies and OTC players to enter the Asian/Pacific market in a respected territory and with no bureaucracy, unlike other Western countries.

Later the regulator had to step in and implement a new set of provisions to restore confidence after hundreds of registered firms practicing illegal activities. New requirements came in force in 2014, demanding an official office set in New Zealand and minimal net tangible assets of the greater of $1,000,000 or 10% of revenue, among others.

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