ESMA margin changes

[Morris]

New ESMA margin rules implemented today I see.

£10 FTSE trade requires £3838 margin.

That's more than the normal futures margin I believe, which is around £ 2500....

IMO this will drastically reduce the turnover for the brokers.

Any views...?

 

[mike.]

That's the minimum margin too isnt it ?

 

[Morris]

That's the minimum margin too isnt it ?

That is the normal margin.

So for example, with LCG, a £10 FTSE position goes from £150 margin to £3838.

 

[mike.]

I mean if your trade went against you and it fell below that threshold, you would then be subject to a margin call. Thats the minimum margin needed .

 

[Morris]

Well the ESMA regs include a 50% rule...

'In the event that your account valuation falls below 50% of your margin amount, all positions on Spread Betting account will be closed in line with ESMA’s 50% stop out rule'

 

[tomorton]

LCG seem to be applying the margin rules from today. Looks like they have also reduced their min stake size on major indices and forex pairs from 0.5 to 0.1: could be helpful for traders with small account capital, didn't realise they were going to do this.

 

[Morris]

LGC changed the margin rules on Sunday I believe.

 

[Splitlink]

Well the ESMA regs include a 50% rule...

'In the event that your account valuation falls below 50% of your margin amount, all positions on Spread Betting account will be closed in line with ESMA’s 50% stop out rule'

I feel that that could be a trap for the unwary. 50% of all that margin can add up to a lot of money. I do not intend to lose any of that margin money, but to trade with surplus to margin amount.

 

[TheRegulator]

Are any of you lot going to ask your broker to move you on to professional trader status in order to get the previous margin and leverage as before the ESMA changes ??


Or you going to stick with the new margin changes?

What's best here.

 

[FXX]

I'm going to have a hand at a professional registration

Sent from my SM-G950F using Tapatalk

 

[Splitlink]

Are any of you lot going to ask your broker to move you on to professional trader status in order to get the previous margin and leverage as before the ESMA changes ??


Or you going to stick with the new margin changes?

Wis hat's best here.

I'm staying with retail. This is because of age--it is not worth my while. I read, somewhere on this thread (or on one with "ESMA" in the title) that there is a tax question. If that is ok then you need to check out the minimum stakes, too.

 

[tomorton]

Are any of you lot going to ask your broker to move you on to professional trader status in order to get the previous margin and leverage as before the ESMA changes ??


Or you going to stick with the new margin changes?

What's best here.

My SB firm demands I demonstrate a £500k portfolio of financial investment somewhere in order to go pro. So that's a non-starter for me. I'm sticking with them until I experience the margin restrictions and understand how its influencing what I do.

 

[FXX]

My SB firm demands I demonstrate a £500k portfolio of financial investment somewhere in order to go pro. So that's a non-starter for me. I'm sticking with them until I experience the margin restrictions and understand how its influencing what I do.

You only need 2 of the list of 3

1) trade volume
2) 500k investments
3) industry experience in a professional capacity

Sent from my SM-G950F using Tapatalk

 

[tomorton]

You only need 2 of the list of 3

1) trade volume
2) 500k investments
3) industry experience in a professional capacity

Sent from my SM-G950F using Tapatalk

Even so, I still don't have 2 out of 3. But thanks.

 

[kalott]

New ESMA margin rules implemented today I see.

£10 FTSE trade requires £3838 margin.

That's more than the normal futures margin I believe, which is around £ 2500....

IMO this will drastically reduce the turnover for the brokers.

Any views...?

and if you are long and short at the same time you need double margin

(if you are trading multiple systems on ftse)

 

[TheRegulator]

I'm going to have a hand at a professional registration

Sent from my SM-G950F using Tapatalk

Is it better to be on the pro side with higher margin as opposed to retail side.

 

[FXX]

Is it better to be on the pro side with higher margin as opposed to retail side.

Depends

You have less saftey net as a pro trader but you need to qualify for it first

Sent from my SM-G950F using Tapatalk

 

[Splitlink]

Yes, I can see that with my #11, I was only scratching the surface.

 

[TheRegulator]

Even so, I still don't have 2 out of 3. But thanks.

If your doing trading for a living doesn't that qualify you as working in the financial service profession and meet one of their criteria.

 

[TheRegulator]

Does anyone know if your a proprietary trader if that qualifies you working in the financial services sector and would qualify one of the criteria?