New Forex Regulations

The Commodities Futures Trading Commission (CFTC) and the National Futures Association (NFA), which determine leverage (and the resulting margin) requirements for Futures and Forex trading, have established new Forex leverage and maintenance requirements.

• The new requirements, which will take effect Sunday October 17, 2010, at 5 p.m. EDT (4 p.m. CDT), will impact all currently open Forex positions, as well as any new Forex positions to be opened on or after October 17.
• The maximum leverage requirements on all major currency pairs will be revised due to the rule revisions:
• Major currency pairs will change from 100:1 to 50:1 maximum leverage (from 1% to 2%). Exotic or minor pairs will change from 25:1 to 20:1 maximum leverage (from 4% to 5%).
• Major pairs consist of any pair with two of the following currencies: Australian Dollar (AUD), British Pound (GBP), Canadian Dollar (CAD), Danish Krone (DKK), Euro (EUR), Japanese Yen (JPY), New Zealand Dollar (NZD), Norwegian Krone (NOK), Swedish Krona (SEK), Swiss Franc (CHF), or US Dollar (USD). All other pairs are considered by the NFA to be exotic and are subject to the higher margin requirement.

Please check day trading requirements and overnight requirements with your Broker.

You will also need to maintain a 100% equity-to-margin ratio (risk level) at all times.

Liquidation of positions will occur once daily, at 5 a.m. EDT (4 a.m. CDT), if the risk level in your account falls to less than 100%, and intraday if the equity-to-margin ratio in your account falls to 25% or below, whichever comes first.