21 Jun 2018

Product Specification Changes

Dear Clients,

Please be advised that the European Securities and Markets Authority (ESMA) has formally adopted new measures for the provision of contracts for difference (CFDs) to retail customers. Further details regarding this announcement can be found here.

These measures apply to trading service providers regulated in EU jurisdiction such as Z.com Trade, and will apply from 1st August 2018. In accordance with these measures, we will be making changes to our product leverages, changing the Margin Closeout percentage which is effective on your trading account, and also introducing negative balance protection.

Please refer to the following details with our schedule below.

Implementation Schedule

1. Margin Closeout
In accordance with the new regulations, the Margin Closeout effective on a trading account must be standardised at a percentage of 50% of minimum required margin. We will therefore change the Margin Closeout effective on your account to 50% as of 21:00 GMT on 1st July 2018.

2. Leverage Changes
The new leverage limits on the opening of a position by a retail client vary depending on the underlying market from 30:1 to 2:1, and further details of this are detailed below. The leverages effective on your account will be changed as of 21:00 GMT on 22nd July 2018, and this will apply to any open positions you hold at this time.

a) Major Currency Pairs (30:1)
The leverage for FX Majors will be changed to 30:1 (Required Margin of 3.33%). “FX Majors” are defined as a pair composed of the following currencies: US dollar, Euro, Japanese yen, Pound sterling, Canadian dollar or Swiss franc. This applies to the following products available on your account: CAD/CHF, CAD/JPY, CHF/JPY, EUR/CAD, EUR/CHF, EUR/GBP, EUR/JPY, EUR/USD, GBP/CAD, GBP/CHF, GBP/JPY, GBP/USD, USD/CAD, USD/CHF and USD/JPY.

b) Non-Major Currency Pairs, Gold and Major Indices (20:1)
The leverage for FX Minors (including “Exotics”), Gold and Major Indices will be changed to 20:1 (Required Margin of 5%). This applies to all other FX products we offer other than those outlined in a) above, FRANCE40, DE30, DE30_L, JP225, AUS200, UK100, US30, US100, US500 and XAU/USD.

c) Commodities other than Gold and Non-Major Indices (10:1)
The leverage for Commodities other than XAU/USD and Indices other than those outlined in b) above will be changed to 10:1 (Required Margin of 10%). This applies to XAG/USD, XBR/USD, XNG/USD, XPD/USD, XPT/USD, XTI/USD, SPAIN35 and HK50.

3. Negative Balance Protection
Negative balance protection will be introduced on a per account basis, and will mean that you cannot incur losses greater than your initial investment. If your Account Balance on the MT4 Terminal falls below 0.00 (for example, due to significant market volatility resulting in ‘price gapping’), the negative amount will be covered by Z.com Trade. Please be aware that this will result in a period of time whereby the negative balance correction needs to be carried out, and your trading account would be unavailable during this time (you would receive a notification from us when your account is ready to be used again). This will be effective from 21:00 GMT on 1st August 2018. Further details of the terms relating to Negative Balance Protection will be outlined in our Customer Agreement and published on our website.

In particular, please be mindful of the new leverage limits which require increased margin in your trading account. Please ensure on an ongoing basis that you have sufficient funds in your account to avoid margin closeout.

Additionally, please also be advised that the above changes apply to clients categorised as ‘Retail Clients’ in accordance with our Client Categorisation Notice. Depending on your personal circumstances, some clients may be eligible for recategorisation as a ‘Professional Client’, in which case the above changes would not apply (however you should be aware that certain FCA protections are waived). For further details of the eligibility requirements for Professional Clients, please refer to our Client Categorisation Notice in the “Elective Professional Client” section.

If you would like to be considered for recategorisation, please fill in our Change of Client Categorisation Request Form and send it to support.trade.uk@z.com.

If you have any questions, please do not hesitate to contact us.

Kind regards,

Client Services Department