Several Cyprus-regulated forex brokers are making amendments to their trading conditions in order to meet the new requirements of the Cyprus Securities and Exchange Commission (CySEC) that come into effect. The list of brokers includes Exness, HotForex, ActiveTrades, VinciCM and Invest.com. To find more about the changed brokers are introducing, please read on.
Last year, the CySEC altered forex and binary option regulations, making it harder for brokers to meet its requirements. In November it announced the ban of bonuses as a measure to attract clients and the introduction of lower default leverage cap (50:1) for forex and contracts for difference (CFDs). The changes were triggered by the recommendations and guidelines of the European Securities and Markets Authority (ESMA) from mid-October in regards to forex and binary options regulation. Although the new rules were approved months ago, they are coming into effect now.
The new leverage rates may affect traders’ open positions and investors should act accordingly.
Exness changes unlimited leverage for 200:1
Exness, the first forex broker to offer an unlimited leverage, starts to offer new clients a leverage cap from 31 January. The new maximum leverage available with the broker will be 200:1 and the maximum default ration will be 50:1. Less experienced traders will be restricted to a maximum leverage of 100:1, but more experienced ones will be able to select a higher leverage rate. Please note that by “less experienced retail clients” we refer to the clients who fail or get an average score in the appropriateness test they complete upon registration.
“The new measures introduced by CySEC are an important step toward maintaining an environment of trust and security for clients to trade within. As an EU regulated broker who has always adhered to the highest regulatory standards, we align ourselves fully with these new regulatory changes […],” the broker said in a statement.
HotForex’ changes caps leverage, swaps bonuses for rebates
HotForex’ new trading rules came into effect from 29 January. They cover various aspects of the trading. The broker will introduce a default leverage cap of 50:1 for new trading accounts, but existing clients will still have the option to increase or decrease the leverage rate choosing from other options available. Less experienced traders, however, will be eligible to use a leverage of up to 50:1.
The broker has also terminated bonus schemes, but it has introduced new reward programs, under which traders can earn daily cash rebates under the new Trading Rebate Program. In addition, investors can opt for the 30% Rescue Program which protects from periods of drawdown.
HotForex also noted that it will continue to offer a negative balance protection.
VinciCM lowers leverage cap only
Leverate-operated VinciCM announced that as of 31 January, 2017, it will lower default leverage to 50:`1, but it will also review client requests for a higher default leverage. However, the broker emphasized that a request will not guarantee a higher leverage would be granted to every client. For instance, higher default leverage will not be available to clients with limited trading experience.
Invest.com lets traders choose whether they want a cap
Rather that setting a maximum default leverage that applies for all clients, Invest.com offers clients the freedom to choose for themselves whether they want to adjust the default leverage level to up to 50:1. The option is available as of 29 January. The broker said it will shortly introduce a new feature that will allow clients to adjust leverage with a single click, but until then traders can send a request to Invest.com if they want their trading conditions adjusted.
ActiveTrades ceases bonuses
ActivTrades has not provided information whether it will alter the leverage rates, but it has said it will discontinue its ActivTraders Rewards program. The program will run until the end of March and traders will be able to swap their collected points for rewards no later than 30 April.