High Risk Warning

Risk Warning

You should not deal in CFDs/Forex unless you understand their nature and the extent of your exposure to risk. You should also be satisfied that the product is suitable for you in the light of your circumstances and financial position. Although CFDs/Forex can be utilised for the management of investment risk, it may not be suitable for some investors. In deciding whether to trade in CFDs/Forex, you should be aware of the following points:

CFDs/Forex can only be settled in cash. Investing in a CFD/Forex carries the same risks as investing in a future or an option or other derivative product. Transactions in CFDs/Forex may also have a contingent liability and you should be aware of the implications of this as set out below.

Contingent liability investment transactions, which are margined, require you to make a series of payments against the purchase price, instead of paying the whole purchase price immediately. If you trade in contracts for differences, you may sustain a total loss of the margin you deposit with your firm to establish or maintain a position. If the market moves against you, you may be called upon to pay substantial additional margin at short notice to maintain the position. If you fail to do so within the time required, your position may be liquidated at a loss and you will be responsible for the resulting deficit. Even if a transaction is not margined, it may still carry an obligation to make further payments, in certain circumstances, over and above any amount paid when you entered the contract. Before you begin to trade, you should obtain details of all commissions and other charges for which you will be liable. If any charges are not expressed in money terms (but, for example, as a percentage of contract value), you should obtain a clear and written explanation, including appropriate examples, to establish what such charges are likely to mean in specific money terms. In the case of futures, when commission is charged as a percentage, it will normally be as a percentage of the total contract value, and not simply as a percentage of your initial payment.

We recommend that you familiarise yourself with our CFD/Forex examples provided on our website. The examples transaction show both positive (profit) and negative (loss) scenarios.

Markets may be volatile and it may be difficult or impossible to liquidate a position

Under certain trading conditions it may be difficult or impossible to liquidate a position. This may occur, for example, at times of rapid price movement if the price rises or falls in one trading session to such an extent that trading in the underlying market is suspended or restricted.

Non-Guaranteed Stops do not necessarily cap your loss to the intended amount

Placing Non-Guaranteed Stop Order will not necessarily limit your losses to the intended amounts, because market conditions may make it impossible to execute such an Order if the underlying market moves straight through the stipulated price.

Guaranteed Stop Orders are available at a premium.

Although our staff will always recommend the use of stop losses this may not suit your individual requirements and the decision is ultimately yours to place these orders

Foreign Exchange Risk

Changes in exchange rates may also cause your investment to go up or down in value for position quotes in foreign currencies.