Plus500 voices its support for new CFD rules unveiled by ASIC
CFD broker Plus500 Ltd (LON:PLUS) has voiced its support for the rules regarding CFD offering unveiled by the Australian Securities & Investments Commission (ASIC) earlier today.
As FX News Group has reported, ASIC has outlined its proposed regulatory changes for the CFD industry in Australia. The new rules will be applied from March 29, 2021. The principal changes are:
- leverage limits on the opening of a position by a retail client;
- a margin close-out rule on a per account basis;
- negative balance protection on a per account basis;
- a restriction on the incentives offered to trade CFD’s; and
- a standardised risk warning.
Plus500 says it fully supports today’s announcement, in the interests of raising standards in the industry, noting that it already operates in compliance with most of these regulatory changes, such as offering negative balance protection and maintenance margin levels to customers.
The Board will continue to assess the potential impact on future years, but believes that such impact is already incorporated in the compiled analysts’ consensus forecasts for Plus500 for FY 2021.
David Zruia, CEO, commented:
“We welcome these new regulations being introduced by ASIC, which are broadly as expected following the announcement of its consultation in August 2019. The regulations will be rapidly and seamlessly adopted by Plus500, supported by the efficiency of our industry-leading proprietary technology. The Company is already compliant in most of the areas covered by the proposed regulation and we will further adapt our business model where additional changes are required. These changes, which are similar in spirit and effect to the regulatory changes implemented in Europe in 2018, act to bring further stability and uniformity to global industry standards.
“We believe these regulatory changes will further enhance the CFD trading landscape by benefitting the compliant industry leaders, such as Plus500, and helping to protect our customers as they access our products. In the meantime, we continue to aim to grow and diversify our business by introducing new product lines, and developing our presence in new geographies.”
According to the trading update provided by Plus500 in September, revenue – and in particular customer income – has remained strong in H2 2020 to date. The company noted that it continues to on-board a “high level” of new customers.
Let’s recall that Plus500 reported a record $564 million in revenue and $320 million in net profit in the first half of 2020, driven by a combination of increased trading among its existing clients, and an unprecedented number of new client sign-ups.
Is trader
October 24, 2020 @ 12:58 am
Well that’s fine for plus 500 , it simply means that as a private financial trader they are not the broker for me , I’ll give my business to a company that doesn’t want to restrict my choice about how I run my business , there are plenty of companies in the world that don’t hold this view , Australia really isn’t a place to do business anymore, that’s fine with me.