For Transactions in Foreign Exchange and Derivatives (Including Contracts for Differences)
In consideration of Domino Europe(hereinafter referred to as “Domino Europe”, “we” or “us”) agreeing to enter into over-the-counter (“OTC”) contracts for differences (“CFD's”) and spot foreign exchange contracts (“Spot FX Contracts”) with the undersigned (hereinafter referred to as the “Customer”, “you”, or “your”), Customer acknowledges, understands and agrees that:
Domino Europe, a Private Limited Liability Company Registered in accordance with the Laws of Malta and having its registered office at Apartment 12, Regent House, Bisazza Street, Sliema SLM 1640, Malta, EU, bearing Corporate Registration Number C/59946, is licensed by the Malta Financial Services Authority (“MFSA”) as a Category 3 Investment Services Provider IS/59946.
This statement, which constitutes an addition to the Retail Client Agreement and the General Terms & Conditions, cannot and does not disclose or explain all of the risks and other significant aspects involved in trading foreign exchange and derivatives. Engaging in transactions offered by Domino Europe can carry a high risk to your capital, where there is the potential that it is lost completely. You should not engage in trading in the products that are offered by Domino Europe unless you have a complete understanding of the contractual legal relationship into which you are entering. If more information on the risks involved is required please contact Domino Europe.
You should also as certain whether such high risk products are compatible with your risk profile. Funds invested in these types of transactions should not affect your lifestyle if they are lost completely. If you have any doubts on whether high risks investments should be a part of your portfolio, please seek independent financial advice.
High Leverage and low Margin can lead to quick losses
A particular characteristic for which CFD’s and Spot FX contracts are known for is the high levels of leverage conventionally used by traders and offered by brokers. Leverage is created when only a marginal amount of funds is needed to execute a trade. For example, with a 1% margin, a trade of 100,000 units could be executed by only using 1000 units. This has the effect of amplifying returns and losses on the amount of margin used to execute the trade. The smaller the account balance the greater the possibility that losses could exceed deposited funds. This is because the maximum loss that the trader can make is not the margin invested in a single trade but the deposited funds in the account itself.
Risk-reducing Orders or Strategies
The placing of certain orders (e.g. “stop-loss” orders or “stop-limit” orders), which are intended to limit losses to certain amounts, do not guarantee that the intended execution may take place. There are circumstances where, due to market conditions or technological limitations, such orders may not be executed or may be executed at unfavourable rates (one example would be during the release of important news items relevant to the asset where market activity may become very volatile).
The minimum margin requirement on all deposits must be maintained at all times by Customer who has the responsibility to monitor the account. In the event that the account equity falls to below 50% of the used margin, Customer shall receive a margin call to add additional funds to the account to avoid the automatic liquidation of open positions at unfavourable rates. Domino Europehas the right to liquidate any or all open positions whenever the minimum margin requirement is not maintained.
Our Spreads, the difference between our Ask price and our Bid price, are set at our absolute discretion as the market maker. Changes are effective immediately and information in relation to Spreads, Leverages, Rollover Fees and Trading Hours for each Market are stated on the Domino Europe website.
Conflicts of Interest
Domino Europe is the counterparty to all Transactions entered into under the Customer Agreement and, as such, Domino Europe’s interests may be in conflict with yours.
Prices, Margin and Valuations are set by Domino Europe and may be different from prices reported elsewhere
Domino Europe calculates its prices by referencing the price of relevant underlying assets which are obtained from third party external sources or exchanges. Domino Europe expects these prices to be reasonably related to prices available in the market; however, Domino Europe’s prices may vary from prices available to banks and other market participants.
In the event of a quoting error, Domino Europe shall not be liable for any resulting errors in Account balances and reserves the right to make necessary correction or adjustments to the relevant Account. The dispute for quoting errors will be resolved on the basis of the fair market value, as determined by Domino Europe in its sole discretion and acting in good faith.
Domino Europe is not a Financial Advisor or Fiduciary to Customer
Domino Europe may provide generic market observations and other information; however, these do not constitute a personal recommendation or investment advice. Your personal financial situation requires professional, independent investment advice. Any decision by Customer to enter into any transaction is their independent decision alone. Domino Europe is not acting as an advisor or serving as a fiduciary to Customer and Customer agrees that Domino Europe is not responsible for any liabilities, claims, damages, costs, and expenses incurred in connection with Customer following Domino Europe’s generic trading recommendations or taking or not taking any action based upon any generic recommendation or information provided by Domino Europe.
Disruptions in Service
Trading online through Domino Europe may differ from trading on other systems or other markets. Trading online through Domino Europe will expose you to risks associated with the system including the failure of hardware and software, system downtime. These could be due to both Domino Europe and the individual customer’s communication infrastructure. As a result there may be delays or failures in execution of trades and other communications. Domino Europe shall in no way be liable for any losses, expenses damages, or costs, caused by such malfunctions. This includes disruptions to the Telephone execution service offered by Domino Europe.
Customers will be able to place orders but not execute trades during the weekends (Saturday and Sunday) or during a holiday when the financial markets general close for trading. The values of assets are very likely to change during closed markets. Consequently, upon re-opening of the markets, the price of these assets could see a large shift. If Customer enters an order during closed markets the trade is very unlikely to be filled at the price specified upon re-opening due to an instant shift in market prices. This also applies to stop loss orders and take profit orders.
Domino Europe Ltd. is a participant in the Investor Compensation Fund for clients of Investment Firms regulated by the MFSA. Customers will be entitled to compensation where we fail to meet our duties and obligations arising from your claim. Any compensation provided to you by the Investor Compensation Fund shall not exceed twenty thousand Euro (€20,000). This applies to your aggregate claims against us. For further information on this compensation scheme, please visit http://www.compensationschemes.org.mt