I can understand the reason for these new regulations but they’re too strict. I mean, it’s perfectly fine that authorities wish to “protect” newbies and retail traders but after all this is not a kindergarten. Trading is a serious business and each aspiring trader or at least 90 % of them are perfectly aware of all the risks. Why do we need to be so limited These changes will affect both brokers and traders by impacting the business in a negative way and pushing traders who cannot afford to classify as professionals or add some serious sums to their accounts directly to some off-shore scam brokers. It’s very annoying.
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My guess is all the big brokers with the majority of the trading volume will eventually have to comply.
Of face some kind of restriction there self
Hi @anon46773462,
In response to statements made by the European Securities and Markets Authority (ESMA) and the Financial Conduct Authority (FCA) announcing regulatory changes in the provision of contracts for difference (CFDs) to retail clients, FOREX.com’s parent company, GAIN Capital, said this on March 27:
The measures on CFDs are being introduced as a temporary intervention on a three-month basis, during which ESMA and FCA will reflect on whether it is necessary extend the intervention measures for a further three months or on a permanent basis, respectively.
While GAIN does not agree with every aspect of ESMA’s new rules, the Company is strongly supportive of measures that enhance consumer protection in the FX/CFD market and elevate standards across the sector, including curbing aggressive marketing to inexperienced investors and mandating disclosure requirements that ensure all clients fully understand the risks of FX/CFD trading.
GAIN operates a diversified business, which includes a retail FX/CFD business spanning eight regulatory jurisdictions, a U.S.-based retail futures business and an institutional trading business. As a result of this diversification, as well as due to actions being taken by the business to mitigate the impact of ESMA’s proposed regulations, the Company believes that ESMA’s new regulations place less than 5% of full year 2018 total revenue at risk, based on an anticipated implementation date of the end of the second quarter of 2018.
Please note that, since the time we made that statement, the measures announced by ESMA have been finalized and go into force on August 1.
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Hi!
And thanks for the reply, I really appreciate you contributing!
I would be interested to hear your views on the possible reaction to the reduced max leverage by small account holders to move their accounts away from well-regulated and responsible firms like yours to off-shore dubious names just to keep a level of leverage that even makes trading worth the effort?
Do you, or your firm, see other possibilities, or advantages, in creating some form of rating assessment for retail traders whereby they could, in the future, apply for higher leverage?
I fully understand that this is a rather sensitive issue and that replying may not be possible at this stage.
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It’s our pleasure, @anon46773462
Due to the nature of such questions, any related comments from us would have to go through official channels and be published on the investor relations site of our parent company, GAIN Capital. We have not made any new statements in relation to the ESMA measures since our comment above, but you can keep up with our latest news here: https://on.forex.com/2NvuCqh
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OK, I understand that 
I am sure you will publish here anything new that is officially released as it is clearly of such critical importance to typical BP members.
I would personally still recommend people to wait out this first 3- month period and not leave their FCA brokers. I am sure there will start to be discussions and reflections on this first stage long before the 3 months is actually up.
Maybe it is a good time to do some backtesting or trying some new ideas with small positions during these next three months until the post-mortem gets underway.
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Very wise words…
Could they not just match swiss 1:100 why such a low level 1:5 / 1:30…
Hi Manxx,
I somehow seemed to have missed your earlier post. My apologies for the delay. FXCM’s statement from December 2017 said the follower regarding the leverage proposal:
We note that the proposed leverage limitations are more restrictive than what is allowed in other jurisdictions, including the US and Australia, and hope these new requirements do not result in business being driven off shore to unregulated or under regulated markets.
Full statement found here. As we all know now, ESMA decided to move forward with the initial leverage proposal despite tens of thousands of comments from traders opposing the lowered leverage. Next, we’ll have to wait for the 3-month period to see if any changes are made.
It should be noted that the ESMA leverage requirements impact traders located in European Economic Area. Traders outside of the EEA can open with FXCM Australia, FXCM South Africa, or FXCM Markets which offers higher leverage. *Leverage can magnify both profits or losses. FX/CFD trading carries a risk of losses in excess of your deposited funds
Jason
The leverage restrictions and other regulations adopted in the summer of 2018 saved UK forex and CFDs traders annually some 451 million pounds, latest Sector Views annual report of the British Financial Conduct Authority (FCA), reveals.
According to the report the persistent lower interest rates drive many retail investors from safer long term investments to high risk assets like CFDs and mini bonds.
According to the FCA data before the new rules were adopted in August 2018 some 800 000 active UK traders held in live client accounts a total of 1,5 billion GBP, of which over two thirds were lost within a year.