CMC Markets has just announced that it is launching its new product offering aimed at professional clients, CMC Pro. The offering is aimed at securing higher leverage rates for those customers who are willing to reclassify.
The firm will allow those clients to conserve the same levels of leverage, which retail clients of the company are using now. In the case of CMC Markets this is up to 1:500. Customers who choose to reclassify to professionals will also gain access to additional benefits from the company.
Requirements to Become a Professional Client
Becoming a professional client is not for everyone. In order to be eligible, clients will have to demonstrate that they fully understand the risks associated with making investment decisions.
According to EU regulations retail clients can reclassify to professional only provided that they meet at least two of the following three criteria:
– they will need to have carried out transactions of a significant size on a relevant market (10 per quarter over the previous four quarters)
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– they will need to have a financial instrument portfolio that exceeds 500,000 euro ($605,206)
– they need to work, or have worked, in the financial sector for at least one year in a relevant professional position
Response to New ESMA Regulations
The news comes after the ESMA has announced that retail clients will only be allowed to use a maximum leverage of 1:30 in major FX pairs. The tiered leverage requirements were rolled out last month, demystifying the regulatory picture for retail brokers in the EU. The changes have been deemed by the industry as very harsh and are likely to reshape the FX and CFDs brokerage industry going forward.
The benefits which CMC Markets offers to professional clients include a personal account manager, priority access to new products, and the ability to earn cash rebates and rewards. The company also states that it will be organizing CMC Pro client events which feature guest speakers and charting analysis, as well as opportunities to expand a trader’s network.
The Group Commercial Director at CMC Markets, David Fineberg, commented on the matter: “Over the last ten years, we have seen tremendous changes in our industry, driven by technology and social media. It is right that regulators are now looking to protect less experienced and potentially vulnerable clients.”
“We are seeing a change in consumer behavior as clients are now demanding a personal, tailored service to suit their individual needs. We will continue to invest in our Next Generation trading platform to meet the requirements of our CMC Pro clients,” Fineberg explained.