Breaking news… The Australian Securities and Investments Commission announced today a product intervention order imposing conditions on the issue and distribution of CFDs to retail clients.
Australia-based FX and CFD provider, ACY Securities, welcomed ASIC’s order.
The product intervention order strengthens consumer protections by cutting down on CFD leverage available to retail clients and by targeting CFD product features and sales practices that amplify retail clients’ CFD losses. The order also brings Australian practice into line with protections in force in comparable markets elsewhere.
Justin Pooni, Head of Branding & Communications at ACY Securities said that ACY Securities expressed his support of ASIC in its decision to introduce greater protections for clients and shield them from excessive risk.
We welcome ASIC’s long-awaited announcement ensuring greater client protection and we support ASIC’s efforts in implementing robust and proportional regulation in the margin and CFD sector.
He added:
ACY Securities are of the view that measures introduced to improve customer outcomes will also benefit the CFD industry in supporting brokers who already put customers first. CFD traders should choose their provider carefully and these improvements will create higher barriers to entry into the Australian financial industry so that hopefully only the best brokers remain to serve FX and CFD clients.
As of 29 March 2021, ASIC’s product intervention order will restrict CFD leverage offered to retail clients to a maximum ratio of:
30:1 for CFDs referencing an exchange rate for a major currency pair
20:1 for CFDs referencing an exchange rate for a minor currency pair, gold or a major stock market index
10:1 for CFDs referencing a commodity (other than gold) or a minor stock market index
Experienced writer and journalist, working in the global online trading sector, Steffy is the Editor of LeapRate. She has previous experience as a copywriter and has been with the company since January 2020. Steffy has a British and American Studies degree from St. Kliment Ochridski University in Sofia.
