XM's safety ~5 reasons for XM's reliability~

What is financial license?

Financial license is the permission which allows brokerage houses to manage financial business such as FX and the license itself is issued by financial authorities of each country. In order to obtain financial license each brokerage house needs to meet the criteria (such as capital, funds custody situation, risk management system) regulated by financial authorities of each country. Therefore the criteria or difficulty level is depending on the issuer of financial license and it is the barometer of safety and reliability of FX brokerage house.

XM as a whole group holds multiple financial licenses

XM Group is an overseas FX brokerage house and obtained a permission from financial authorities around the world. XM is managed by "XM Global Limited" and has obtained a securities dealer's license with number 000261/397 issued by Financial Services Commission (FSC).

Each company within XM Group including "XM Global Limited" has multiple licenses besides the License from Finalcial Services Authority (FSA). Having obtained difficult licences such as Cyprus Securities and Exchange Commission (CySEC) indicates that XM Group is a highly safe overseas FX brokerage house.

Structure of segregated funds custody

Segregated funds custody is the system where clients' funds are separately managed in the different bank account other than the funds of the company for its own operation. XM has obtained the financial license from Financial Services Commission (FSC) and clients' funds are safely managed according to the license procedure.

Structure of segregated funds custody

Deposit/Realized profits are all safe through complete safe management

XM deploys " segregated funds" for its clients funds management. Clients' funds are dispersedly deposited in quality good banks located banks in Germany and Switzerland and are completely segregated and managed from our company's own funds. XM conducts proper evaluation of the banks for its deposit not only before the deposit but also after the funds deposited and tries to keep the safety of the funds. Clients' funds are not included in the balance sheet of the company and will be secured from the payment to the creditors even in the case of our bankruptcy.

XM has an obligation to follow strict financial rules as a holder of license of Financial Services Commission (FSC). Therefore if there is a lack of management or funds management along the regulations on yearly internal audit, the details are reported by our internal auditor to the financial authority, the license issuer.

XM has obtained the safety for clients' funds through segregated funds custody with reliable quality good banks and thorough safety management. Clients' funds with XM including deposited funds as well as the profit you have earned are all secured safely, so feel at ease.

Overwhelming execution power and no requote/no rejection

All the orders are executed not through human intervention by dealers with XM, but through automatic next generation NDD system. As a result, there occurrs no conflict of interest between XM and clients and clients can enjoy trading in a fair and transparent trade environment at ease.

We also deploy highest level order infrastructure among competitors and 99.35% of all orders are executed within 1 second with no requote or no rejection even in the hours orders pouring in. As XM holds tremendous numbers of clients as the largest in the field, it can marry orders of clients and enables overwheling execcution ratio (execution power) and execution speed.

What is negative balance protection?

Negative balance protection is the system where XM takes the loss of clients and reset the minus balance back to nil when the volatile market movement does not meet the loss-cut (forced-settlement) timing and loss exceeds the valid margin money.

Clients face "additional margin call" and will take the risk of higher debt than expected in the case loss exceeds valid margin money for domestic FX brokerage houses who are not allowed to compensate the loss of clients due to the regulation of Japan. On the other hand most of overseas FX brokerage houses including XM compensate all the losses from negative balance, therefore clients do not have to bear the loss. In addition to it, you can enjoy high leverage trading safely as there is no additional loss other than the deposited amount.

Condition/timing of negatice balance protection

Negative balance protection promptly works when clients becomes deposit more money than minimum deposit amount, exchange XMP (XM Points) into USD or move funds between accounts.

XM's Negative Balance Protection is executed at the timing of additional money deposited, however there may be the case that system will return client's balance back to "zero" without addditional deposit if the client does not have positions. In this case the timing of execution of negative balance protection might become irregular.

Loss Cut Line Set at Margin Ratio 20%

Loss Cut system is the system where the unrealized loss of the position held by client goes below certain level and is compulsory settled by the FX brokerage house in order to avoid further loss. This works as a safety device for lessening the loss of more than certain level and protect client's assets. XM's Loss cut system starts to work when the margin goes below 20% of the maitain ratio. This ratio is the lowest among the FX brokerage houses and clients can persistently continue to trade under the condition that market goes agaist client's expectation.

There may be the case that the loss cut is not in time for volatile movement of the market and the valid margin money goes below zero. Please do understand. Even when client's balance gose below zero, client will not meet additional margin call thorugh negtive balance protection, so client can trade at ease.

Various service and working hours

XM sets up the support desk of 24 hours, 5 days a week and are ready to accept the enquiries by e-mail in more than 27 languages and online support through live chat in 27 languages.

We stand by with full back-up framework of back office/IT staff and monitor the trade environment 24 hours 365 days.

If loss is caused, XM promptly adjust the trade record and there will not be any unfavorable loss for clients.

How to Contact XM for Inquiry (Trough Live Chat or Using Form)