GFT News

New NFA Rules Cap the Leverage on Majors and Exotic Currency Pairs

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15 Oct, 2009 – ADA, MICH., Please be advised that the CFTC has recently approved rule-amendments of the U.S. regulatory body, the National Futures Association (NFA), to change the maximum leverage requirements for customers of forex dealer members (FDMS).

The amendments will limit the amount of leverage that can be used to trade what the NFA considers to be “major” and “exotic” currency pairs – to be effective on 30 Nov. 2009. View the new maximum leverage rates here.

For all traders holding a forex account with the U.S. entity Global Futures & Forex, Ltd. (dba GFT), the NFA changes will be implemented at 5 p.m. ET on Sunday, 29 Nov. 2009.

“Our customers should be aware of these new NFA requirements, and determine in advance how this may affect their decisions and trading plan,” said Gary L. Tilkin, president and CEO, GFT.

If traders have open positions in these currency pairs at a higher leverage than the new maximum leverage required by the NFA, it will impact their margin requirement for those open positions.

“As always, exercise proper risk management and consider whether you need to deposit additional funds to be adequately capitalized for these new leverage rates, in accordance with your own trading plan,” said Tilkin.

As one option, GFT offers its customers the ability to change their lot sizes (e.g. 10,000, 20,000, etc.), which in addition to being properly capitalized is an alternate choice to trading higher leverage.

“We believe traders should understand how leverage can work both against you and for you, no matter which currencies they choose to trade, and that all traders should have choices to use leverage that is appropriate for his or her risk appetite,” said Muhammad Rasoul, executive vice president and COO, GFT.

GFT customers who reside outside of the US, Japan or Australia also have the choice to trade higher leverage by smoothly and efficiently transferring their current account with their existing account settings to GFT’s U.K. affiliate (GFT Global Markets UK, Ltd.).

View GFT’s latest capital numbers listed on the CFTC (Commodities and Futures Trading Commission) website as well as our regulatory record on file via the NFA (National Futures Association) website.

About GFT

GFT provides service, support and award-winning trading technology through its DealBook^® suite of trading platforms, which are designed for trading online spread bets, spot foreign exchange and contracts for differences.

GFT launched its online spot forex trading services in 1997, becoming a pioneer in the online trading industry. Today, GFT is the brand name of several divisions and subsidiaries throughout the world. GFT’s world headquarters is based in Ada, Mich., with additional U.S. offices located in Chicago and New York and global offices in London, Tokyo, Sydney, Singapore and Dubai.

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This information is made available by or for Global Futures & Forex Ltd. (GFT) in Australia (ABRN 103 508 461, AFS License 226625). Trading of foreign exchange contracts, contracts for differences, derivatives and other investment products which are leveraged, can carry a high level of risk, and may not be suitable for all investors. It is possible to lose more than the initial investment. A Product Disclosure Statement (PDS) is available from the company website a www.gft.com.au. Please read and consider the PDS before making any decision to deal in GFT products. © 2009 Global Futures & Forex, Ltd. All rights reserved.