As the ESMA restrictions start to bite is it worth signing up to ETX Capital’s professional client package?
It was the bad news the spread betting sector had feared. ESMA confirmed it was bringing in new rules which impose leverage limits on retail clients. However, spread betting companies have already been hard at work creating new products to help experienced investors carry on as before.
- Have more than €500k in assets excluding your home
- Relevant expertise in financial services
- Traded at least ten times in each of the last four quarters.
To verify your status, they may require supporting documents such as FCA register screenshot, LinkedIn account, or an investor portfolio statement.
The advantage is that you can get around the ESMA restrictions and continue trading these products in much the same way as before. Your funds will also be held in a segregated account and protected by the FSCS.
You benefit from a personal account manager, lower margin rates from 0.35% on major FX pairs, access to volume-based rebates, together with premium research. They will send the latest expert trading ideas straight to your inbox.
The service does have it’s downsides though. Because you’re registering as a professional trader you will be treated as such. The language may be more complicated, and they may not be as easy to understand as the more basic platform. It also removes some of the protections from negative balances which means you could lose more than you put in.
Overall, the ETX Capital service is as good as most others on the market. It’s another in a series of innovative products designed to help CFD brokers and the spread betting sector cope with a new and somewhat more restrictive regulatory environment. It is certainly one way to avoid the ESMA caps as long as you can meet the requirements, but you need to go into it with your eyes open.
You can find out more about the ETX Capital professional service here.
Tom Cropper has been writing for us since 2015. Tom is a financial journalist and his work has appeared in titles such as the Guardian, Euromoney and many others.