Important Notification - CFDs Margin Requirements'16

Financial Services Commission (FSC)(license number 000261/397)

XM™|How to open the FX account.

Important Notification - CFDs Margin Requirements'16

Important Notification - CFDs Margin Requirements'16
News & Topics

2016.07.28

2022.08.15

Kindly note that as of August 1st 2016 the margin requirement for CFDs will be calculated based on margin percentages rather than on a fixed margin.

To help you understand how it will be calculated, please make note of the following:

Old Margin Formula = Lots * Initial Margin
New Margin Formula = Lots * Contract Size * Opening Price * Margin Percentage

Note: clients should ensure that their accounts are sufficiently funded in order to avoid any disturbances from possible margin calls and/or stop-outs in their trading activity.

Below you can view a few examples on how the margin will be calculated in comparison to the old way:

Example 1 Future Energies - Consider a USD account with 10 Buy (or Sell) lots of NGAS

Lots Margin
Requirement
Opening
Price
Margin
Old Formula 10 130 2.65 10 (Lots) *130 (Margin) = 1,300 USD
New Formula 10 3% 2.65 10 (Lots) *1000 (Contract Size) * 2.65 (Opening Price) * 3% (Margin Requirement) = 795 USD

Example 2 Indices Futures - Consider a EUR account with 10 Buy (or Sell) lots of EU50

Lots Margin
Requirement
Opening
Price
Margin
Old Formula 10 40 2977 10 (Lots) * 40 (Margin) = 400 EUR
New Formula 10 1% 2977 10 (Lots) * 1 (Contract Size) * 2977 (Opening Price) * 1% (Margin Requirement) = 297.7 EUR

In the case where your account base currency is not in USD, the calculated margin will automatically be converted to your account base currency at the current market rate.

The new margin requirements for CFDs will be published on the website on August 1st 2016.

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