IG Securities to adjust margin requirements for crude oil
IG Securities to adjust margin requirements for crude oil
IG Securities, the Japanese subsidiary of the global trading company IG Group, has announced an adjustment to its margin requirements for corporate accounts trading crude oil, including WTI and North Sea crude oil.
The decision was made in response to escalating geopolitical tensions in the Middle East, particularly Iran's missile strike on Israel, which has contributed to increased market volatility and uncertainty.
Starting at 6:00 a.m. on October 4, 2024, the minimum margin requirements for new positions on crude oil-related instruments for corporate accounts will be raised to 4%. This adjustment reflects IG Securities' commitment to periodically reviewing and adjusting its margin requirements to align with price volatility, market liquidity, and other risk factors.
The company emphasized that this change will only affect corporate accounts and will not apply to individual retail accounts. Additionally, the revised margin requirements will apply only to new positions, meaning that existing positions held by corporate clients will remain unaffected by this update. IG Securities also indicated that the margin rate and lot size for each trading level could be subject to further adjustments based on market conditions.
This temporary increase in margin requirements aims to mitigate the risks associated with heightened volatility in the crude oil market due to geopolitical unrest. The company noted that margin changes could be reversed as early as next week, depending on how market conditions evolve. IG Securities encouraged its clients to monitor the latest updates on the trading platform, where they can view the most current maintenance margin ratios.
Furthermore, IG Securities mentioned that similar margin increases could be extended to other financial instruments if market conditions warrant such actions. Clients are advised to regularly check for updates on the trading system before executing any trades to ensure they are aware of the latest requirements.
For any questions or concerns regarding these changes, IG Securities advised clients to contact the support desk for assistance.
This announcement underscores IG Securities' proactive approach to managing market risks and ensuring the stability of trading activities during periods of global uncertainty. By raising margin requirements, the company aims to protect its clients from potential losses caused by sharp price fluctuations in the crude oil market.
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