Incase you weren't aware, the European Securities and Markets Authority (ESMA) have introduced new regulations that affect all retail clients. Among other changes, this includes new leverage restrictions and an automatic close out of positions where your margin falls below 50% of the amount required. The leverage available to Retail Clients on spread betting, forex and CFD products will now be capped at a maximum of 30:1 for major FX pairs, and less for other assets.
What does this mean? You now need a lot more money to be a spread better!
Taking equities as an example, last week I could have opened a 10k trade with only a £400 margin, this week I need 2k.
Its not all bad news however as this has forced me to do the one thing I have always resisted doing and that is to deposit the majority of my trading capital into my trading account as opposed to keeping it in my bank account and transferring it back and forth as needed.
This will make accounting much easier.
I thought I'd provide this update now since this is the first of August so it's a good time to psyche myself up for a good trading month.
I've been holding back a little the last few months since hearing about the ESMA changes but now that they are behind me there is no excuse, just need to get on with it.
I'll post again at the end of the month, hopefully with a decent monthly gain!
Just remember - He Who Dares...WINS!