Future Updates to Margin Requirements
Please review the trading conditions in your online account, or see our general trading conditions page for up-to-date margin requirements and new margin policies here.
DATE: JANUARY 19th 2015
Following the removal of the floor in EURCHF by the Swiss National Bank on Thursday, January 15th 2015, Global Trading has decided to increase margin requirements across a number of instruments in line with our Liquidity Providers. The changes affect:
- New FX margin requirements
- New CFD Index & CFD Single Stock margin requirements
- Changes to the FX Option margin calculation
- FX Option trading in Swiss Franc
After a long period with low volatility across asset classes, we foresee a paradigm shift in the financial markets.
We would like to prepare our clients and signal the need for having sufficient margin to support potentially bigger and more extreme short term shocks. CHF was one example. This week’s potential quantitative easing announcement from ECB and the election in Greece, January 25th, are other such events.
In future we expect our Liquidity Providers to be more dynamic on margin levels depending on the financial environment and calendar such as the increase in margin requirements implemented for CHF in Sep 2014 from 4% to 8%.
As a result, Global Trading will increase margin requirements for the following instruments on Wednesday, 21st of January 2015, at 15.00 GMT / 10:00am EST as follows below.
New FX Margin Requirements
| Currency Code | Name | Current Margin* | New Margin |
|---|---|---|---|
| AUD | Australian Dollar | 1%/2% | 3% |
| EUR | Euro | 0.5%/1% | 2% |
| USD | US Dollar | 0.5%/1% | 2% |
| GBP | British Pound | 0.5%/1% | 2% |
| JPY | Japanese Yen | 0.5%/1% | 3% |
| CHF | Swiss Franc | 4%/8% | 15% |
| NZD | New Zeland Dollar | 1%/2% | 3% | XAU | Gold | 2%/4% | 6% |
| XAG | Silver | 3%/6% | 8% |
*The 50% margin reduction offered for the first EUR 300,000 of your investment collateral will be removed.
For the full list of affected Forex contracts, please check your online account (instructions at the bottom of the page under “More Information”.
Corresponding CFDs on FX and Commodities will be increased similar to the above.
New CFD Index & CFD Single Stock Margin Requirements
| Ticker | Name | Current Margin* | New Margin |
|---|---|---|---|
| DAX.I | Germany 30 | 0.5%/1% | 2% |
| SP500.I | US SPX500 | 0.5%/1% | 2% |
| DJI.I | US 30 Wall Street | 0.5%/1% | 2% |
| NAS100.I | US Tech 100 NAS | 0.5%/1% | 2% |
| FTSE100.I | UK 100 | 0.5%/1% | 2% |
| CAC40.I | France 40 | 0.5%/1% | 5% |
| DEN20.I | Denmark 20 | 0.5%/1% | 5% |
| DEN20CAP.I | Denmark 20 Capped | 0.5%/1% | 5% |
| STOXX50E.I | EU Stocks 50 | 0.5%/1% | 5% |
| BELG20.I | Belgium 20 | 0.5%/1% | 5% |
| MDAX.I | Germany Mid-Cap 50 | 0.5%/1% | 5% |
| HSI.I | Hong Kong Index | 0.5%/1% | 5% |
| AEX.I | Netherlands 25 | 0.5%/1% | 5% |
| NOR25.I | Norway 25 | 0.5%/1% | 5% |
| SWE30.I | Sweden 30 | 0.5%/1% | 5% |
| FTSE250.I | UK Mid 250 | 0.5%/1% | 5% |
| US2000 | US 2000 | 4% | 5% |
| TECDAX.I | Germany Tech 30 | 0.5%/1% | 5% |
| NI225.I | Japan 225 | 0.5%/1% | 5% |
| ASXSP200.I | Australia 200 | 0.5%/1% | 5% |
| SPMIB.I | Italy 40 | 0.5%/1% | 5% |
| ZA40.I | South Africa | 5% | 10% |
| CHINA50 | China 50 Index | 4% | 10% |
| INDIA50 | India 50 Index | 4% | 10% |
| SINGAPORE | Singapore Index | 4% | 10% |
| TAIWAN | Taiwan Index | 4% | 10% |
| PSI20.I | Portugal 20 | 0.5%/1% | 10% |
| IBEX35.I | Spain 35 | 0.5%/1% | 10% |
| SMI.I | Switzerland 20 | 0.5%/1% | 10% |
*The 50% margin reduction offered for the first EUR 50,000 of your investment collateral will be removed.
For the full list of affected Single Stock CFDs, please check your online account (instructions at the bottom of the page under “More Information”.
Changes to the FX Option Margin Calculation:
The volatility floor value in the Vega Margin requirement will be changed from 10% to 20%. The FX Option margin requirement consists of Delta Margin + Vega Margin, where the Vega Margin is calculated as follows:
- Vega Margin = Notional Amount * Vega * Max (Implied Volatility, Floor Value) * Volatility Factor
- The floor value in the calculation above will be changed to 20%.
FX Option trading in CHF
Global Trading will resume FX Option trading in CHF after the margin change has taken place on Wednesday in the following crosses: EURCHF, USDCHF, CHFJPY and GBPCHF.
More Information
You can get an overview of upcoming margin and collateral changes in WebConnect and on DesktopTrader:
- In DesktopTrader: Click on Account > Reports > Margin & Collateral Changes
- In WebConnect: Click on Trading > Margin & Collateral Changes
Please note that the removal of half margin is not included in these overviews.