Risk Disclosure Statement
Introduction to CFDs:
Contracts for Difference (CFDs) are financial derivatives allowing investors to speculate on price movements of underlying financial instruments without owning the assets. Investors can take long (buy) or short (sell) positions depending on their market outlook.
1. General Information:
This document does not cover all associated risks or other significant aspects of CFDs and should not be considered investment advice.
Before engaging in CFD transactions, clients must fully understand the nature of CFDs, the risks involved, and the extent of their exposure. If uncertain, clients should seek independent legal or financial advice.
Clients should be aware that:
The value of investments in financial instruments may fluctuate and can become worthless.
Past performance does not guarantee future results.
Trading financial instruments may incur tax or other duties.
Changes in exchange rates can negatively impact the value and performance of financial instruments traded in currencies other than the client's base currency.
2. Risks Associated with CFDs:
a. Leverage Risk: Leverage can make CFD trading riskier than direct investments. A minor price movement can significantly impact a trade.
b. Gapping Risk: Market volatility can cause rapid price fluctuations, preventing orders from being placed between price levels.
c. Stop Loss Orders: Not always effective during rapid price movements or market closures.
d. Margin Call and Liquidation Risk: Insufficient funds to cover margin obligations may force the liquidation of positions.
e. Risk of Loss of Invested Funds: Adverse market movements can result in the loss of the entire account balance or more.
f. No Guarantee of Profit: There are no guarantees of profit in CFD trading.
g. No Rights to Underlying Assets: CFD trading does not grant rights or obligations concerning the underlying instruments or assets.
3. Other Risks:
a. Market Risk: The value of a portfolio can decrease due to market changes.
b. Systemic Risk: Failure of a single entity can trigger a negative market effect.
c. Technical Risk: Faults in electronic equipment can lead to unpredictable results and losses.
d. Operational Risk: Arises from human error in business operations.
e. Country Risk: Political changes or instability can negatively impact returns.
f. Interest Rate Risk: Investment values can change due to variations in interest rates.
g. Foreign Exchange Risk: Investments’ values can be affected by changes in exchange rates.
h. Legal and Regulatory Risk: Changes in laws or regulations can increase operation costs and affect profitability.
4. Risks Beyond the Control of Monte Edge Capital:
Monte Edge Capital is not liable for the following client-related risks:
Lack of knowledge of trading terminal settings.
Technical faults in the client's software.
Disclosure of registration credentials to third parties.
Unauthorized access to the client's email account.
Delayed reading of information sent to the client's email.
Any other force majeure circumstances affecting the client.
Clients must understand and manage these risks independently.
This Risk Disclosure should be read carefully.
in conjunction with the "Terms and Conditions of Business," the "Order Execution Policy," and all other relevant legal documents available on our website.
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