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#1 06-09-2019 09:46:25

Admin & Trader
From: Paris - France
Registered: 21-12-2009
Posts: 3421

ASIC suggests 20:1 leverage for forex trading

ASIC proposes a ban on binary options and CFD restrictions

Late last month, the ASIC (Australia's Securities and Investments Commission) released a note that proposes to impose restrictions on binary options and CFDs.

The Australian regulator proposes to completely ban the issuance of binary options. The regulatory agency is concerned about the harm that Australian retail investors continue to suffer from due to the existence of binary options.

With regard to CFDs, like the ESMA, the ASIC has proposed a number of restrictions such as the imposition of leverage limits, more transparet pricing, improved execution, the implementation of negative balance protection and a uniform approach to the automatic closing of positions in margin calls.

ASIC paves the way for 20:1 leverage for all forex pairs

However, the Australian regulator has taken a different approach. Unlike ESMA, the ASIC will not distinguish between major and minor currency pairs. Instead, the regulatory agency proposes a universal leverage ratio of 20:1 for all forex pairs.

For stock market indexes, the ASIC suggests a ratio of 15:1, 10:1 for most commodities, 20:1 for gold, 2:1 for crypto pairs and 5:1 for ordinary shares.

ASIC Commissioner Armor says: "For many years, ASIC has taken action to protect traders from binary options and CFDs, using a broad range of tools that are available to us, but we are concerned that consumers continue to suffer significant harm with these asset classes.

We believe that options don't really offer any value, and have features that are similar to gambling products.

This announcement isn't much of a surprise, though, as rumours have been circulating since the beginning of the year that the ASIC could imitate ESMA's actions.

"Anything worth having is worth going for - all the way." - J.R. Ewing



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