Risk Disclosure Policy

1. Purpose

This Legal Risk Disclosure (“Disclosure”) is provided by FNmarkets (“The Company”) to inform clients (“Clients”) of the potential financial risks associated with trading financial instruments, including but not limited to Contracts for Difference (CFDs), foreign exchange (Forex), commodities, indices, and cryptocurrencies. This disclosure aims to ensure transparency and assist clients in making well-informed decisions regarding their trading activities. It is imperative that clients read, understand, and acknowledge these risks before engaging in trading activities with the company.

2. General Risk Warning

Trading financial instruments carries significant risk and may not be suitable for all investors. The high degree of leverage typically available in trading can magnify both gains and losses. Clients should carefully assess their investment objectives, experience level, and risk appetite before engaging in trading. The possibility exists that clients could lose all or a significant portion of their initial investment. Therefore, clients should only trade with funds they can afford to lose. Clients are strongly advised to fully understand the risks involved in trading financial instruments and seek independent financial advice if necessary. FNmarkets does not provide investment advice, and clients bear full responsibility for their trading decisions.

3. Market Risks

• High Volatility: The prices of financial instruments can be highly volatile, experiencing significant fluctuations within short periods. Such volatility can lead to substantial gains or losses.
• Leverage Risks: Trading with leverage amplifies both potential profits and potential losses. Even a small market movement can have a significant impact on a leveraged account, possibly leading to a margin call or the liquidation of positions.
• Market Conditions: Under certain market conditions, it may be difficult or impossible to execute orders at the requested price, leading to potential losses. Stop-loss orders may not effectively limit losses due to market volatility or illiquidity.
• Liquidity Risks: Some financial instruments may lack liquidity, making it difficult to buy or sell at the desired price or obtain accurate valuations.

4. Technical Risks

• System Failures: Trading over the internet involves risks related to the use of electronic systems, including hardware, software, and internet connection failures. FNmarkets is not liable for any communication failures, distortions, or delays in trading caused by technical issues.
• Client Terminal Risks: Clients may encounter risks due to incorrect settings, delayed updates, or unfamiliarity with the operation of their trading terminal. Such risks may result in financial losses.

5. Platform-Specific Risks (MetaTrader 5 - MT5)

• Order Execution: The MT5 platform employs a sophisticated order entry mechanism and order tracking system. While FNmarkets strives to execute orders at the requested price, execution risks associated with market conditions, slippage, and system delays remain.
• Technical Issues: The MT5 platform may be subject to risks related to hardware or software malfunctions, internet connectivity issues, and other technical failures. FNmarkets disclaims liability for any losses resulting from such technical issues.

6. Third-Party Risks

• Intermediary Risks: Funds held with third parties, such as banks or brokers, may be kept in omnibus accounts, and may not be segregated from other clients’ funds. FNmarkets is not liable for any acts or omissions by these third parties.
• Regulatory Risks: Client funds held outside the European Economic Area (EEA) may be subject to different legal and regulatory regimes, which could affect the treatment of these funds in the event of the third party’s insolvency.

7. Legal and Regulatory Risks

• Force Majeure: FNmarkets is not liable for any losses or damages directly or indirectly caused by events beyond its control, including but not limited to natural disasters, war, terrorism, and changes in laws or regulations (force majeure events).
• Regulatory Changes: Changes in laws, regulations, or government policies can impact the operation of financial markets and potentially lead to client losses. Clients are responsible for ensuring their compliance with local laws and regulations.

8. Investment Risks

Risks related to the nature of investments include the following:

• Non-Guaranteed Returns: Trading financial instruments does not guarantee returns. There is a high risk that clients may lose the initial capital invested and, in certain cases, may incur additional liabilities.
• Contingent Liability: Certain financial instruments, particularly those traded on margin, may require additional payments beyond the initial investment, leading to potential financial obligations for clients.
• Off-Exchange Transactions: Transactions conducted off-exchange, such as over-the-counter (OTC) forex or commodity trades, may pose higher risks than exchange-traded derivatives due to the absence of a central clearinghouse and lower transparency.

9. Specific Risks Related to Cryptocurrencies

• High Volatility: Cryptocurrencies are highly volatile and can experience rapid and substantial fluctuations in value, leading to significant financial gains or losses within a short period.
• Regulatory and Technical Risks: Cryptocurrencies are not supported by any government or central bank. Their value depends largely on market participants’ trust and the robustness of the underlying technology. Any regulatory actions or technological failures can severely affect the value and liquidity of cryptocurrencies.

10. Client Acknowledgment and Responsibility

• Understanding Risks: Clients must only engage in trading if they fully understand the associated risks and have carefully evaluated their financial situation and risk tolerance.
• Responsibility for Losses: Clients acknowledge and accept full responsibility for any losses or damages arising from their trading activities. FNmarkets is not liable for any losses incurred by clients.
• Confidentiality and Security: Clients are responsible for maintaining the confidentiality and security of their trading account credentials. FNmarkets is not liable for any financial losses resulting from unauthorized access to client accounts due to negligence or security breaches on the part of the client.

11. Updates to Risk Disclosure

FNmarkets reserves the right to update or modify this Legal Risk Disclosure at any time. Clients are responsible for regularly reviewing this Disclosure to stay informed of any changes that may impact their trading activities.

12. Contact Information

For any questions or further clarification regarding this Legal risk disclosure, clients are encouraged to contact FNmarkets at [email protected].