Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 73% of retail investor accounts lose money when trading spread bets and CFDs with this provider. You should consider whether you understand how spread bets and CFDs work, and whether you can afford to take the high risk of losing your money.
Options and turbo warrants are complex financial instruments and your capital is at risk. Losses may be extremely rapid. Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 73% of retail investor accounts lose money when trading spread bets and CFDs with this provider. You should consider whether you understand how spread bets and CFDs work, and whether you can afford to take the high risk of losing your money.
Options and turbo warrants are complex financial instruments and your capital is at risk. Losses may be extremely rapid.
Barriers, turbo24s, spread bets, CFDs and vanilla options come with a unique set of risks. You can take control of these using our risk management tools, and ensure you're well informed with our range of educational resources.
When might it happen?
|Why it happens||Ways we help|
|Losing more than the money on your account.||
You can’t lose more than the money on your account when buying barriers, turbo24s or vanilla options, as you put up the maximum risk to open your trade.
Sometimes your positions may close and leave you with a negative cash balance on your account – putting you in debt to us.
Thanks to negative balance protection, we bring negative accounts back to zero at no cost to you.1
|Losing more than it cost you to open your trade.||
You can’t lose more than you paid to open when buying barriers, turbo24s or vanilla options, as you put up your maximum risk when you place your trade.
|When you trade CFDs, spread bet or sell vanilla options to open, you only need to put up a fraction of your trade’s value – the margin. So while you can win – much more than your initial deposit, you can also make much greater losses.||
You can mitigate risk and lock in profits with spread bets, CFDs by setting an automatic stop or limit, to define the level you'd like your trade closed at.
|Having your positions closed unexpectedly, resulting in you losing money.||
When you buy barriers, turbo24s or vanilla options, you pay all that’s needed to keep your position open upfront. Barriers and turbo24s may close automatically, but only ever at the knock-out level you choose.
|You need a certain amount of margin in your account to keep your CFD, spread bet or sold vanilla trades open. If your account balance doesn’t cover our margin requirements we may close your positions for you.||
Keep an eye on your always-visible running balances in our platform or app, and add more funds if they’re needed.
|Sudden or rapid losses (or gains).||
Markets can be volatile, moving very quickly and unexpectedly in reaction to announcements, events or trader behaviour.
The higher the leverage you’re using on a trade, the faster any loss or gain will grow – although your maximum loss will be limited to your initial outlay when buying barriers, turbo24s or vanilla options.
As well as setting stops, you can also be notified of significant movement on your spread bet or CFD trade by setting a price or distance alert, giving you the choice of whether or not to react.
|Having an order (an instruction you give us, to open or close a trade for you when the market hits a certain level) filled at a different level to the one you requested.||
Orders to open and close aren’t available for vanilla options.
|When a market moves a long way in an instant – or ‘gaps’ – any orders you have placed may be filled at a worse level than the one you requested. This is called slippage.||
Use guaranteed stops on spread bets and CFDs, or your knock-out level on barriers and turbo24s, for watertight protection against slippage. Guaranteed stops are free to place, with a small premium payable only if your stop is triggered.
Leverage enables you to gain a large exposure to a financial market while only tying up a relatively small amount of your capital. In this way, leverage magnifies the scope for both gains and losses.
When buying barriers or vanilla options, you pay your maximum risk to open your position in the form of an option premium. This is usually smaller than buying the underlying asset outright, and is the maximum amount you could lose should the market turn against you.
Turbo24s are similar, in that your initial outlay to buy the security is also your maximum loss.
When selling vanilla options, you receive the premium upfront, which is your maximum profit. If the market moves against you, you could lose far more than this premium.
For spread betting and CFDs, even though you only put up a relatively small amount of capital to open a position, your profit or loss is based on the full value of the position. Therefore, the amount you gain or lose could be relatively large compared to your initial outlay.
Set a stop-loss to close your CFD position automatically if the market moves against you. There’s no trigger charge, but no guarantee of protection against slippage – so your position could be closed out at a worse level if the market gaps.
Attach a guaranteed stop to your CFD position, and it’ll always be closed out at exactly the price you specified. Barrier options and turbo24s have this guaranteed stop built in, in the form of the knock-out level.
What’s more, you’ll only pay for your stop if it’s triggered. If this happens, our guaranteed stop premiums still offer the best value in the market for most major indices and FX pairs.
Place a trailing stop when you open your CFD trade and it will move with your profit. If the market turns, your position will close out at your trailing stop’s new level. So you can lock in profits without the need to monitor your position and adjust your stop.
Like regular stop-losses, trailing stops don’t protect against slippage.
Set a limit order in line with your profit target, and we’ll close your position for you when the price hits your chosen level. Available on barriers, turbo24s and CFDs.
Set price alerts, and we’ll notify you by text or email when a market reaches your specified price.
Keep an eye on the always-visible balance snapshot in our platform, and react quickly if the market moves against you, and deal out almost instantly to protect a profit or minimise a loss.
Regulations ensure that if your balance does go negative, we’ll be obligated to bring it back up to zero at no cost to you.1
How does a stop-loss order work?
What’s meant by ‘risk’ in trading?
1Negative balance protection is a requirement of the European Securities and Markets Authority (ESMA), and applies to trading-related debt only. It is not available to professional traders.