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straddle

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About straddle

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  1. ESMA has fired the starting gun, new rules from August 1st
  2. "CFDs that will be subject to the restrictions are any derivative other than an option, future, swap" Are traded options included or excluded?
  3. JAMES You write "we think ESMA will extend the time period for these rules at least a couple of times before national regulators like the FCA update their own rules to be more like ESMA’s new rules." Will IG impose the new rules when ESMA decides or when the FCA follows, which, according to the above, could be 6 months later?
  4. trevbeats I have asked James twice on this thread about the feasibility of transferring an IG account to IG Switzerland/Australia, but he seems unwilling/unable to answer.
  5. London I know 14,000 members who are considering stopping trading with IG. Does IG want to try to keep them?
  6. I have asked James (above) if it is possible to transfer to one of the IG non-EU accounts, e.g. Switzerland or Australia, but he has not yet replied. That would be preferable to opening a new account with another non-EU broker, and I would have thought also prefererred by IG.
  7. James Is there any problem to transfer an IG account to Switzerland or Australia? Does one have to be non-EU resident? This would seem to be a solution to avoid the ridiculous ESMA regulations and still remain an IG client.
  8. http://www.bbc.com/news/technology-43398410
  9. The ONLY reason the regulators want to limit leverage is in order to limit the risk of loss. If the possible loss is limited by a GUARANTEED Stop loss, which the regulators want to make compulsory, then the degree of leverage is totally irrelevant. Therefore the reasoning in the above post makes no sense at all.
  10. IG has offices in other parts of the world eg Australia. Would it be possible/beneficial to transfer the account?
  11. Over 3,000 email replies now, not one in favour. The vast majority saying they would immediately stop trading.
  12. submission to ESMA: Even if ESMA insists on limiting leverage, the limits proposed are draconian. Several EU regulatory bodies have proposed leverage limits in the last year, and none are as severe as the ESMA proposals. The FCA has proposed limits of 25x for inexperienced traders and 50x for experienced traders. In Cyprus Cysec has instituted 50x and 100x leverage limits respectively. A review by BaFin in Germany has insisted on negative balance protection but has instituted NO limits on leverage. The leverage limits proposed by ESMA will not only reduce trading but will kill it, both because many people will not be able to afford the margin deposit required, which may be 10x the current deposit, but also because such a large deposit will alter the risk/reward ratio to such an extent as to make trading not cost effective. Further, if margin deposit is increased 10x, it means the loss will be 10x before the deposit is lost and negative balance protection applies. On the other hand, if automatic margin close-out and negative balance protection are instituted, then this is adequate protection and there is no need for severe restriction on leverage.
  13. Andrex "In contrast, I positively assess ESMA's proposal to provide clients with protection against a negative balance that actually protects investors from a loss greater than the deposit paid" Yes, but if margin deposit is increased 10x, it means the loss will be 10x before the deposit is lost and negative balance protection applies.
  14. Hi Ian You write "Whereas before you would have seen a 75% return on capital (500/660), you will now see a 7.5% return on capital. If you have places with a higher rate of return than that, then you should switch to those, but in my mind that's still a phenomenal return." My point is that a 7.5% return is far from guaranteed, and in fact there is a high chance of loss. Selling options is considered a high risk strategy, which in my opinion is not warranted for the sake of a maximum 7.5 % return and the chance of a loss many times that.
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