Dear Traders,
Thursday’s unexpected announcement by the Swiss National Bank that it would abandon its 3 year old cap on the Swiss Franc’s value against the Euro resulted in extreme volatility in the FX markets.
There were significant price gaps and periods of illiquidity in Swiss Franc pairs immediately following the surprise announcement but we continued to provide prices to our traders and filled client orders as liquidity became available. As a result we stand by Thursdays trades and will not adjust any trade executions. Additionally, we will be forgiving all negative client balances that were caused by price gaps. (where permitted by regulations).
After a thorough review we can report Direct FX’s balance sheet had no material impact due to the recent CHF volatility. We will continue to take a conservative approach when managing exposure to global currencies as to mitigate these risks in the future.
I understand that some of you may have questions regarding this week’s unprecedented events. I encourage you to contact us with any questions you have at Contact Us - Direct FX
As indicated in previous emails, we have temporarily increased the margin requirement for all CHF pairs to 5% (20:1) leverage until market conditions stabilize.
We appreciate your continued support.
Best Regards,
Joseph O’Mara
CEO, Direct FX Trading Pty Ltd