RockFX Leverage 400:1

A new ruling by the National Futures Association (NFA) goes into effect on  15th May 2009. It deals with  the practice of hedging by  forex traders. In hedging, a forex trader holds both long and short separate positions in the same currency pair at the same time. This practice is termed Offsetting Transactions by the NFA and the new Compliance Rule 2-43(b) requires Forex brokers (FDMs - U.S. Forex Dealer Merchants) to offset positions in a customer account on a first-in, first-out basis, thereby prohibiting the trading practice known as hedging. A client  may, however, direct the US FDM to offset same-size transactions, despite the fact of having older transactions of a different size. This Rule 2-43(b) will be effective for any forex positions established after May 15th. Offsetting positions established prior to 15th May do not have to be liquidated, but once either position is closed out, it may not be re-established as a hedge. So if a client goes long and short the same pair at the same time, no outright  forex position will be created because the US FDM will offset them against each other and no trade will be left open. NFA is the industry organization US forex brokers belong to. The NFA regulator is the Commodity Futures Trading Commission (CFTC).

In the light of these recent events in regard to hedging and the proposed amendments whereby no FDM would be allowed to offer more than 100:1 leverage on the major currencies or more than 25:1 leverage on other currencies to clients,  investors Europe (a MiFID compliant stockbroker regulated by the FSC) confirms that it accepts U.S clients and is able to provide U.S. traders, investors and institutions forex execution services with leverage up to 400:1