ESMA Leverage Regulations

ESMA LEVERAGE REGULATIONS

ESMA Leverage Regulations – The European Securities and Markets Authority (ESMA) have announced that they will introduce new measures relating to trading in FX and Contracts for Difference (CFD) for retail clients.

What are the changes?

  • Reduced Leverage – Lower leverage limits will be applied to new trades in FX, Indices, Precious Metals and Oil. Any open positions will remain margin ed at the previous levels.
  • Close-Out Level – The margin Close-Out level to be applied to your account will be 50%.
  • Negative Balance Protection – We will guarantee that your account losses will be limited to the sum of your deposits and you will not fall into negative equity.
  • No Bonus – We will no longer be able to offer bonus incentives or credit.

When will the changes take place?

The changes will be applied to your trading account on Sunday 29th July 2018.

What do I have to do? ESMA Leverage Regulations

  • Check the table below to see the new leverage/margin rates.
  • Check below for the new MT4 symbols will be introduced if you have open positions at the time of the change to the new rules.
  • Consider how the new leverage restrictions may affect your trading strategy and if you will be adequately capitalized.
  • Consider if you need to update your EA to function correctly when the new rules are applied.
  • Contact our Partner Brokers Support Team if you need any help or have questions.

Important Changes to MT4 Symbols

  • Forthcoming ESMA rules on leverage limits are to be applied to new positions only; any positions opened before implementation of the new rules will remain at the same leverage they were originally opened.
  • In order for your MT4 platform to manage this, those open positions will be moved to a different MT4 symbol. These new symbols will be placed to ‘close-only’ and you may only close these positions, not open new ones.
  • You can continue to open new trades on the same symbols that you are trading now but adjusted to calculate at the new leverage levels.
ESMA Leverage Regulations | Changes to trades already open before 29/7/2018
ESMA Leverage Regulations | Current MT4 Symbols
EURUSD
XAUUSD
XAUUSD.fx
USOUSD
All open trades will be automatically migrated to the symbols with .’dot’ extension.
New MT4 Symbols
EURUSD 
XAUUSD 
XAUUSD 
USOUSD 
These symbols will be ‘close-only’. You are not able to open new trades.
ESMA Leverage Regulations | Changes for new trades opened after 29/7/2018
ESMA Leverage Regulations | Current MT4 Symbols
EURUSD
XAUUSD
XAUUSD.fx
USOUSD
You will still be trading the same symbols as before the changes but with the new leverage limits applied.
% / RiskAccount Size $LeverageLotsStops
1%10,00050:152 pips
1%10,00020:125 pips
1%10,00010:11

10 pips

1%10,000ZERO0.1100 pips

Read the Following Guides for More detail on Understanding Leverage BEFORE You Trade Forex!

and The Importance of Forex Money Management