The crackdown on margins begins
Time to keep an eye on the emails from your brokers.
ETX Capital has sent one out to customers saying that they will be changing their margin format from 26th May. Citing the new requirements from the ESMA, they will be putting in place a 50% margin close out rule. The change may affect any positions from 26th May.
We’re going to be getting a lot more news about the new margin and leverage changes at borkers so make sure you’re up to speed with your broker correspondence.
Also, let us know how you are planning for all the changes coming. Are you happy to carry on with brokers that make these changes, mostly meaning you have to put more money in your accounts, or would you look to change to brokers outside of your normal (or regulatory) jursidication that won’t be applying the changes? There’s a risk that traders are tempted to join other brokers in countries who won’t be implementing these regs and that opens up extra risk for traders. At the moment I’m in the ‘take it on the chin’ camp.