[IMPORTANT UPDATES] Upcoming margin increase ahead of Brexit deal voting
On Tuesday 15 January, the UK parliament will vote on on the Prime Minister Theresa May's Brexit deal agreed with the European Union. Due to the uncertainty of the results, UBFX is temporarily increasing the margin on the most likely affected currency pairs.
UBFX operates a pure, STP model and passes all trade flow directly to its liquidity providers for execution. That being said, the Company has no way of knowing how its liquidity providers, or the markets in general, will react to the election results other than to say that this will be a very volatile and fluid situation. We could potentially experience the extreme widening of bid/ask spreads and removal of liquidity as banks and other providers seek to manage their risks. CFD markets could be especially affected by the heightened volatility given the fact that there are a limited number of liquidity providers offering these products.
In order to prepare for the potential increase in volatility surrounding the January 15th UK Brexit deal voting, it will be necessary for UBFX to temporarily adjust the margin requirement for the all the GBP FX pairs as well as “GBP-based” CFD product. We would expect these measures to be temporary in nature but would ask that you monitor your margin in your MT4 account and make any adjustments that are warranted in light of the above changes to margin requirements.
From 10:00 GMT Monday, January 14, 2019, we will begin to adjust our margin requirements:
All GBP forex pairs will have a margin increase to 2% (i.e. leverage from 100:1 to 50:1)
Index CFD UK100 will have a margin increase to 2% (i.e. leverage from 100:1 to 50:1)
Depending on the uncertainty and volatility in the markets, there is also a possibility of further margin changes to these or any other products, which could be significantly higher without any prior notification.
We would like to draw your attention to the Margin Trading Customer Agreement, where you have a continuing Margin obligation to UBFX to ensure that there is no shortfall in your account balance to prevent a Margin Call at all times, and that there is no obligation for UBFX to inform you. Consistent with our stated policy, accounts which are not margin compliant are subject to immediate and automated liquidation to restore compliance.
Hence, we strongly encourage you to monitor your positions carefully and ensure that you have sufficient funds to fulfill the margin requirements at any time, in addition to any running losses.
If you have any questions, please email us at [email protected] and we'll get straight back to you. Alternatively, call us on (+44)203 8089388 and we'll be happy to help.
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