New ASIC regulations

ASIC’s measures are broadly consistent with measures implemented in many overseas markets particularly in Europe. Their intention is to better regulate leverage products offered to retail clients. IG firmly believes in the implementation of robust and proportionate measures to improve client outcomes.

The ASIC measures will be implemented from 29 March 2021.

These measures only apply to retail clients, so those clients who are categorised as Wholesale and trade through a Pro account will not be impacted.

Clients can choose to elect to be categorised as a wholesale client if they meet the legal requirements. The Corporations Act 2001 allows clients with sufficient Experience or Wealth to qualify as a wholesale client.

More information can be found at: https://www.ig.com/au/professional

The benefits of an IG Pro Account can include lower margins and cash rebates. But, it’s important to note that as a wholesale client, you may not be afforded the same protections under the Corporations Act 2001 as what you would have had as a retail client. Such protections include (but are not limited to) the issuing of a Product Disclosure Statement (PDS), and the ability for AFCA (IG’s external dispute resolution body) to refuse to consider complaints from wholesale clients.

IG has delivered a sustainable business for more than 45 years by placing good client outcomes at the heart of everything it does. IG’s business model ensures that its interests as a business are aligned with the interests of its clients, which sets it apart from others in the industry.

IG will continue to lead the way in the industry, and the business is well placed to manage regulatory change as we have already shown leading into, during and after the European regulatory changes and continue to deliver sustainable growth.

The leverage restrictions will only apply to new positions opened after the implementation date. The only change impacting existing positions is if you trade using guaranteed stops or bought options, then you will be subject to the new margin close out rules (see question 6 & 7).

When we calculate account equity today, we do not currently include running losses on positions with guaranteed stops. Under the new rules, running losses on positions with guaranteed stops will be included as part of the Margin Close-Out calculation. Accordingly, positions with guaranteed stops will now be subject to new Margin Close-Out rules. This means that if you have a Limited Risk account, you will have an ongoing margin obligation from 27 March 2021.

The margin requirement for long option positions is the greater of the maximum risk or the underlying equivalent. The margin and profit or loss on these positions will now be included as part of the Margin Close-Out calculation (in the same way as guaranteed stops). Offsetting options positions will no longer be eligible for a margin reduction.

When retail clients’ futures contracts rollover and a position is opened after the ASIC implementation date, then the new position will be margined basis the new ASIC minimums.

Australian resident:

Australian resident will only be eligible to contract with our ASIC licences.

Emerging Markets clients (from non- EU countries and non-office countries):

Yes, as you are not a resident of Australia you can consider our other entities. We have a specific offering for clients from countries where we don’t have an office and you may elect to migrate to this licence.

Yes, the new margin requirements will apply to Limited Risk positions. The minimum margin on a LR position will be those set by ASIC. Your required margin can still be greater than this however if your stop is further away than these minimums.

No retail clients will no longer be able to reduce your margins by placing a guaranteed or nonguaranteed stop.

This will still be available for Pro clients.

No. For retail clients long and short positions will need to be fully margined after the rules are implemented.

Existing positions that you have open prior to the rules coming into force will be unaffected.

This will still be available for Pro clients.

Unfortunately, we will no longer be able to offer collateral to retail clients. This will still be available for Pro clients.

Retail clients will no longer be eligible for volume-based rebates. Pro clients will continue to have access to rebates. Rebates earned before 29th March will still be paid as per normal.

As New Zealand clients' CFD accounts are held with the Australian office of IG Australia Ltd, ASIC's new regulations will apply to New Zealand clients.