The Australian regulator has proposed an extension to its product intervention order imposing conditions on the issue and distribution of CFDs to retail clients until 1 April 2031 or revocation.
The order came into effect on 29 March 2021 and will expire on 23 May 2022 unless it is extended.
ASIC’s product intervention order has reduced CFD leverage, standardised margin close-out arrangements, protect against negative account balances and prohibited CFD providers from giving certain inducements to retail clients.
The Aussie watchdog noted that for the first three months since the order took effect, ASIC has seen significant improvements in key metrics of retail client losses from CFD trading. The regulator stated that retail clients’ net losses from CFD trading decreased 94% of the quarterly average of $372 million in the year prior to the product intervention order to $22 million. There were fewer loss-making retail client accounts and the average losses made by loss-making retail client accounts was also reduced.
Independent writer and journalist, working in the global online trading sector, Steffy is the Editor of LeapRate. She has previous experience as a copywriter and has been with the company since January 2020. Steffy has a British and American Studies degree from St. Kliment Ochridski University in Sofia.