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Re: ESMA bans binary options, sets restrictions on CFDs for retail clients

36 by mlawson71
The European Securities Markets Authority (ESMA) announced it is renewing the restrictions on CFDs trading for another three months as of February 1, 2019. The pan-European regulator also implied that it will monitor closely forex brokerages, as it has identified certain malpractices.

Ever since August last year, when these measures have been officially applied, CFD providers have been searching for ways to get around them, and more specifically the leverage cap to 1:30 for retail clients. Some of them are advertising to such clients the possibility of becoming professional clients upon request and thus becoming eligible to use higher leverage ratios. Another tactic forex broker use is moving their customers’ accounts to an intra-group third-country entity.

ESMA stated it is aware of those malpractices and will monitor closely CFD providers. The regulator also implied it is possible to introduce “other Union measures” it deems appropriate.

Re: ESMA bans binary options, sets restrictions on CFDs for retail clients

37 by ChuChu Rocket
mlawson71 wrote: Tue Feb 05, 2019 2:28 am The European Securities Markets Authority (ESMA) announced it is renewing the restrictions on CFDs trading for another three months as of February 1, 2019. The pan-European regulator also implied that it will monitor closely forex brokerages, as it has identified certain malpractices.

Ever since August last year, when these measures have been officially applied, CFD providers have been searching for ways to get around them, and more specifically the leverage cap to 1:30 for retail clients. Some of them are advertising to such clients the possibility of becoming professional clients upon request and thus becoming eligible to use higher leverage ratios. Another tactic forex broker use is moving their customers’ accounts to an intra-group third-country entity.

ESMA stated it is aware of those malpractices and will monitor closely CFD providers. The regulator also implied it is possible to introduce “other Union measures” it deems appropriate.
Shit!

Re: ESMA bans binary options, sets restrictions on CFDs for retail clients

39 by mlawson71
Denmark announced that it will also ban the sale of binary options to retail customers, pointing out that such instruments are too complex and risky for inexperienced traders.

The step follows similar moves by other European countries like the UK and Austria.

According to the Danish Financial Supervisory Authority (FSA) many retail investors in Europe lose money with binary options which currently are offered online mainly by offshore companies without a license.

Re: ESMA bans binary options, sets restrictions on CFDs for retail clients

40 by mlawson71
Ireland also followed suit.

“The Central Bank is banning the sale of binary options to retail investors as we consider them a fundamentally flawed product, which have no place in the investment plans of retail investors. They are no more an investment than betting on a horse.” said Derville Rowland, director general of financial conduct at the Central Bank of Ireland. ”

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