CEX.IO Broker - General Risk Disclosure
General Risk Disclosure
This notice provides you with information about the risks associated with investment products, which you may invest in through services provided by CEX.IO Broker.
CEX.IO Broker provides investment services in relation to a number of products through Digital Markets LTD, the company incorporated in St. Vincent and the Grenadines.
Investment products offered by CEX.IO Broker include contracts for differences (CFDs) whose underlying assets are cryptocurrencies.
The trading of commodities and currencies involves a significant amount of risk. Prices vary every day; hence you can lose or increase the value of your assets in any moment. All commodities have the ability to grow in price or lose its value or even become worthless and it only depends on a market supply/demand. There is always a sufficient risk that losses will occur as a result of buying, selling or trading anything on the market.
Unlike most currencies, which are supported by government reserves or other legal entities, as well as commodities such as silver and gold, cryptocurrency (a.k.a. virtual currency) is a "flat" currency, which is only backed by mathematics, technology and trust. Most of the virtual currencies are absolutely decentralized, which means there is no authority that can take corrective measure to protect its value in a crisis. Some of them are controlled by entities, which are not subject to government authority of any country and has its own monetary policy. Cryptocurrency trading has specific risks, which are not shared with other official currencies, goods or commodities in a market. There’s always a possibility of sudden and adverse shifts in trading and other market activities. Every time you finance a purchase or sale of virtual currencies on a peer-to-peer basis you may suffer from not being able to repay that financing.
Every cryptocurrency has its own features – blockchain, protocols, etc. and inherent risks which you must understand before investing in it. ACCORDINGLY, CRYPTOCURRENCIES SHOULD BE SEEN LIKE AS AN EXTREMELY HIGH RISK ASSET AND YOU SHOULD NEVER INVEST FUNDS THAT YOU CANNOT AFFORD TO LOSE.
Contract For Difference (CFD), means you are not buying the underlying asset, and assumes transferring the difference between the current value of cryptocurrency and its value at the contract maturity/closure moment. The subject to the contract is an underlying asset price movement, the underlying asset itself is not being delivered as a result of the contract period. Thus, you are able to invest in an underlying asset without actual possession of it. The complexity of CFD and its excessive leverage whereby present significant risks of financial losses. If the market price moves against yours expected price, you may sustain a total loss greater than the funds invested in a specific position. You are responsible for all losses on your account in respect to the assets in your account.
Before deciding to trade on margin you should carefully consider your investment objectives, level of experience, and your possibilities for risk.
(Our CFDs are not listed on any exchange. CFDs involve greater risk than investing in on-exchange products, as market liquidity cannot be guaranteed and it may be more difficult to liquidate an existing position.)
The prices and other conditions are set by us in accordance with our obligation to provide best execution as set out in our order execution policy, to act reasonably and in accordance with the applicable Terms and Conditions.
OUR CFD products are not available to US residents.
CFDs are not appropriate for a long-term investor. Holding a CFD open for a long time increases the associated costs, for instance, overnight fees, and it may be more beneficial to buy the underlying asset instead. The price of the underlying asset may suddenly change because of the sharp movements in the market known as “gapping”. It may occur when the underlying market is closed, meaning the price on the underlying market may open at a significantly different level, and at a less advantageous price for you. You have to ensure your accounts with margin while your positions are opened in accordance with Our requirements, which may change from time to time. Thereby, if asset price moves against you or if our margin requirements have changed, you may need to provide us with significant additional funds, at short notice, to maintain your open positions. If it won’t be done your positions (one or more) may be closed and You alone will be responsible for any losses incurred as a result.