FX Margin Trading and Leverage
Trade FX in a Lot Size that's right for you
Trade (or Lot) sizes start at 0.1 (a 10,000 unit trade or 10,000 base currency size) up to lot sizes of 1 (a 100,000 unit trade or 100,000 base currency size) per one lot.
Here are some examples of what this means:
U.S. Dollar/Japanese Yen (100,000 U.S. Dollars)
Euro/U.S. Dollar (100,000 Euros)
Euro/Great Britain Pound (100,000 Euros)
Euro/Japanese Yen (100,000 Euros)
Trading FX on Margin - 100 : 1
Put simply, margin serves as collateral to cover any losses that you might incur. Since nothing is actually being purchased or sold for delivery, the only requirement, and indeed the only real purpose for having funds in your FX account, is for sufficient margin.
Essentially when you trade on margin you are using a free short-term credit allowance from JMI Brokers Limited. This short-term credit allowance is used to purchase an amount of currency that greatly exceeds your account value.
Let's take the following FX example:
You have an account with $10,000 with JMI. You trade ticket sizes of 1,000,000 GBP/USD. This equates to a margin ratio of 1% ($10,000 is 1% of $1,000,000). How can you trade 100 times the amount of money you have at your disposal? The answer is that JMIS temporarily gives you the necessary credit to make the transaction you are interested in making. Without margin, you would only be able to buy or sell tickets of $10,000 at a time. On standard accounts JMI Brokers applies a minimum 1% margin.
This margin facility allows you to potentially make large profits from a relatively small initial investment but it must be pointed out that any losses are equally multiplied.
Customers who hold FX positions may become liable to pay margin as detailed in our terms and conditions. All FX positions have an initial margin and you are required to keep this over and above any unrealized losses. Margin calls can be made at any time and it is therefore important for you to familiarize yourself with our terms and conditions especially the section relating to margin calls. Be aware that it is your responsibility, not JMIS, to monitor your positions and make any margin payments as they become due.
Monitoring Risk Exposure
Our FX trading platforms have been designed to effectively monitor and allow you to control risk exposure in real time. Based on each clients margin requirement, the FX trading platform system calculates both the funds needed to retain current open FX positions and the trading resources available for entering into new positions or for adding to existing open FX positions.
If the equity in your account drops below the margin required to maintain your open positions, we may close all open positions. Once usable margin reaches zero, a margin call will ensue, and all open positions may be closed by us. This limits your risk to usable margin.
JMI BROKERS AG, is a Swiss legal Corporation with its registered office in Zug with registration # CHE 334-229-499 and purpose of "Asset and Fund Management"
JMI Brokers LTD is a licensed Financial Services Provider from Vanuatu Financial Services Commission and authorized to carry business on Dealing in Securities under license number 15010
"Securities" means (as from the 2012 amendment) - (a) shares in the share capital of a corporation; or (b) an instrument that creates and acknowledges the indebt - securities that is issued by a corporation or a public office including: (i) debentures; or (ii) debenture stock; or (iii) loan stock; or (iv) bonds; or (v) certifications of deposit; or (c) a right, despite whether or not conferred by warrant, to subscribe for shares or debt securities; or (d) a right under a depositary receipt; or (e) an option to acquire or dispose of any security falling within any other provision of this Act; or (f) a right under a contract for the acquisition or disposal of the relevant securities under which the delivery is to be made at a future date and at a price agreed when the contract is made in accordance with the terms of that contract; or (g) the proceeds of Foreign Exchange; or FOREX (h) the proceeds of precious metals; or (i) the proceeds of commodities.
High Risk Investment Warning: Trading foreign exchange and/or contracts for differences on margin carries a high level of risk, and may not be suitable for all investors. The possibility exists that you could sustain a loss in excess of your deposited funds and therefore, you should not speculate with capital that you cannot afford to lose. Before deciding to trade the products offered by JMI Brokers you should carefully consider your objectives, financial situation, needs and level of experience. You should be aware of all the risks associated with trading on margin. JMI Brokers provides general advice that does not take into account your objectives, financial situation or needs. The content of this Website must not be construed as personal advice. JMI Brokers recommends you seek advice from a separate financial advisor.
All opinions, news, analysis, prices or other information contained on this website are provided as general market commentary and does not constitute investment advice, nor a solicitation or recommendation for you to buy or sell any over-the-counter product or other financial instrument.