I haven’t traded for several months but today I thought I would dip my toe in the water. I wanted to open a 1 lot buy trade on Euro/US$ but when I logged into my FXCM account and opened the chart I noticed the required margin was about US$439. Previously it would have been about US$20. I don’t recall receiving any notifications from FXCM about such a big margin change. I’m what they call a retail client and it looks like my leverage has dropped from about 100:1 to 30:1. Can anyone tell me when this happened and have all brokers done this? I’m thinking of changing my broker. I always use a tight stop loss and don’t see how such a hike in margin requirements can be justified.
Hi ianpauljones,
It sounds like your account may have been impacted by the margin changes due to the new ESMA rules. The European Securities and Markets Authority (ESMA) announced maximum leverage amounts which went into effect on 29 July.
The margin changes impact all brokers in the EU and leverage is limited to:
- 30:1 for major currency pairs
- 20:1 for non-major currency pairs, gold and major indices
- 10:1 for commodities other than gold and non-major equity indices
- 5:1 for individual equities and other reference values
- 2:1 for cryptocurrencies
Traders were emailed about the changes, and more detail can be found on our website ESMA Announcement - FXCM UK
Let me know if you have any questions.
Jason
Hi Jason,
Thanks very much for your reply. I was on holiday when all this was happening and it’s come as an irritating shock 