Attention CFD Traders
FXCM is making exciting new updates to our CFD offering.
Most CFD instruments on FXCM accounts will be enabled to trade in smaller sizes (micro lots) after February 28. Now you will be able to trade indices and commodities in 1/10th the size as was previously used. This means you can trade these instruments in smaller amounts, freeing up your available margin and allowing you greater flexibility in your trading.
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1. How will CFD lot sizes change?
You will now be able to trade indices and commodities in 1/10th the size as was previously used. For example:
If you open a US30 position today:
Currently, the minimum trade size is “1” which equates to a $1 profit/loss for each price tick. On a USD denominated account, FXCM requires a $90 margin deposit for each 1 lot traded. Margin rates will vary for accounts denominated in other currencies.
If you open a US30 position after February 28:
The minimum trade size will remain “1”, however because the pip cost is being reduced by 1/10th, the profit/loss for each price tick will be 10 cents USD. The required margin will subsequently be $9 USD.
2. How will open positions and orders be affected?
Historical and open positions/orders will also be reduced by 1/10th. The lot size of these positions will be multiplied by 10 so that the profit/loss & rollover posted to your account remains the same. For example:
2 lots of NAS100 are opened on 1 January, which has a 100 point profit equating to a profit of $200 USD. Margin requirements are set at $25 per lot ($50 for 2 lots). How will existing positions appear after February 28?
Essentially, your position will remain exactly the same, only it will now appear as a 20 lot position as opposed to a 2 lot position.
NOTE: Positions and orders include: open positions, pending/resting orders, closed trades, deleted/cancelled/rejected historical orders, & execution orders that resulted in closed/open trades.
3. Why is FXCM changing the value of the lot size on its CFD instruments?
FXCM is making this change so that you can trade CFDs in smaller amounts. This will allow you to free up your available margin and allow you greater flexibility in your trading.
4. Which CFD instruments will be affected?
CFD Instruments that will have the value of a lot reduced by 1/10th:
CFD instruments that will have the minimum trade size reduced:
The minimum trade size for most CFD instruments is 1. This will remain unchanged for all but two CFD instruments, the HKG33 and the JPN22. For these instruments, instead of reducing the value of each lot by 1/10th, the minimum trade size will simply be reduced by 1/10th. This will have the same effect as allowing you to trade in smaller sizes.
- HKG33: The minimum trade size for the HKG33 is currently 10. This will be reduced to 1.[li]JPN225: The minimum trade size for the JPN225 is currently 100. This will be reduced to 10.
CFD instruments not affected:
Spot metals are unaffected as they already have very small per pip values.
5. Will margin requirements change?
Yes. As the value of 1 lot will be reduced by 1/10th, the margin requirements for that position will also be reduced by 1/10th. Please register for a practice account to see updated margin requirements.
6. Will the “Max Quantity” for CFD positions be raised?
Yes. The maximum amount allowed in a single trade/ticket will be increased by a factor of 10 for affected CFD instruments.
MetaTrader 4 FAQs
1. How will my Expert Advisors (EA) be affected?
All Expert dvisors and manually created Orders and Pending Orders for affected CFD instruments will automatically update to the new volume size after February 28. Any new Order or Pending Order created after February 28 on an affected CFD instrument will be subject to the new volume size.
Expert Advisor users should update the Input values of their EAs to compensate for the new volume size. This is normally done by changing the Lot Size variable in the EAs Inputs menu (accessible with the F7 key). All Symbol/Instrument names will remain the same.
If your EA used a Lot Size of “1” prior to February 28, then you should change the Lot Size to “10” after February 28 to maintain the same trade size. As an example, an EA trading the UK100 prior to February 28 using a Lot Size of “5”, should be adjusted to a Lot Size of “50” after February 28, to maintain the same trade parameters.
2. How will my scripts be affected?
Like EAs, any script which relies on inputting an order size will need to be adjusted accordingly.
3. How will my Indicators be affected?
Indicators will not be affected.
Before and After Table
The table below reflects MMR (margin requirements) for a USD denominated account. For a comprehensive list of MMR, please in other account denominations please see the CFD Product Guide.
Please let me know if you have any further questions.