Trading 212, a brand of forex brokerage Avus Capital, said on Monday it will return later in the day to its standard, pre-Brexit margin conditions and will soon increase stop-out levels.
On 20 June, a few days before the UK referendum, the broker temporarily hiked minimum margin requirements to offset possible losses resulting from the UK vote. Now, all pre-Brexit conditions will be resumed, with the exception that all British pound British pound (GBP) pairs will be traded with a new margin of 1%.
As of 15 June, if a trader’s funds fall below 50% of the margin requirement, the broker will instantly close all their open positions at the current market prices. Prior to the change, clients had to maintain a minimum of 20% of the margin levels.
To reflect the change, the broker has altered its client agreement. The clause aims to prevent traders from sustaining losses exceeding the funds they’ve deposited. The move is in response to the high market volatility after the UK’s EU membership referendum, Trader 212 said. The UK voted on 23 June, 2016, to exit the European Union (Brexit), causing markets to experience deep volatility and the GBP to fall sharply on the Euro (EUR) to its lowest in more than 30 years.
The broker reminded clients to keep sufficient funds that meet the margin requirements if they want to keep their positions open.
Bulgaria-based Avus Capital operates under the brand Trader.BG in Bulgaria and Trading 212 everywhere else. It provides trading in forex and contracts for difference (CFDs) on forex, gold, oil and stocks in more than 65 countries, including Germany, Russia, and China. It has units authorized and regulated by the UK’s Financial Conduct Authority (FCA) and Bulgaria’s Financial Supervision Commission (FSC), and since earlier this year by the Cyprus Securities and Exchange Commission (CySEC). This makes it a licensed broker under the Markets in Financial Instruments Directive (MiFID). A MiFID license grants access to the capital markets in all countries in the European Economic Area (EEA).
In March, the brokerage launched Tradebird, a social news platform in the US, and ProQuant, a financial charting engine that facilitates retail traders in analyzing market trends and building their own trading strategies. The broker also has developed a proprietary trading platform under the Trading 212 brand available for desktop and mobile devices.
Source: Trading 212