Risk disclosure

1. Leverage risk

Leverage amplifies the effect of market movements on your capital. A portfolio financed at 50% loan-to-value experiences approximately twice the percentage change in equity for a given change in asset prices. A 20% fall in the value of the underlying assets can therefore reduce your equity by 40% or more.

2. Margin call and forced liquidation

Your borrowing capacity is recalculated continuously from the current market value of your collateral, while your loan balance remains fixed. If the maintenance ratio falls below 130%, you will be required to restore the buffer within the window set out in your facility agreement.

If the ratio reaches 110%, or if you fail to meet a margin call within the required period, positions may be closed without further notice. You will not choose which positions are closed, the timing, or the price. A forced liquidation may crystallise losses that would not have been realised had the positions been held, and may occur at the least favourable point in a market cycle.

3. Interest rate risk

Financing rates are floating. The benchmark component moves with market and policy conditions, and your cost of borrowing rises accordingly with no action on your part. Contractual spreads are also subject to periodic review. You should assess affordability against materially higher rates than those prevailing when you draw.

4. Collateral revaluation and eligibility risk

Advance rates reflect the liquidity and volatility of each holding, both of which can deteriorate. A security may be re-banded to a lower advance rate or removed from the eligible list entirely — for example following a corporate event, a suspension, or a sustained fall in traded volume. This reduces your borrowing capacity immediately and may itself trigger a margin call.

5. Concentration risk

Portfolios concentrated in a small number of holdings, in a single sector, or in correlated instruments are substantially more likely to experience a rapid decline in collateral value. Concentration limits reduce but do not remove this risk.

6. Correlation risk

Diversification measured in normal market conditions frequently fails in stressed conditions, when correlations across assets converge. A portfolio that appears diversified may behave as a single position precisely when the maintenance ratio is being tested.

7. Liquidity risk

In disorderly markets it may not be possible to exit positions at or near quoted prices. Where liquidation is required, execution may occur at prices materially worse than the last traded price, increasing the loss borne by your account.

8. Currency risk

Where the currency of your loan differs from the currency of your assets or your base currency, movements in exchange rates will affect both the value of your collateral and the cost of repaying the loan. Currency movements can exceed any interest saving obtained by borrowing in a lower-rate currency.

9. Facility review and withdrawal

A margin facility is not committed capital. It remains subject to review and may be reduced or withdrawn in accordance with your facility agreement, requiring repayment on the terms specified there. You should not treat a facility as permanent funding for an illiquid or long-horizon position.

10. Suitability

Margin financing is not suitable for all investors. It is appropriate only for those who understand the mechanics described above, can absorb the loss of the capital committed, and are able to meet a margin call promptly from resources held outside the account. If you do not fully understand the risks set out in this notice, you should not apply for a facility.

11. No investment advice

The information on this website, including rate cards, calculators, worked examples and articles, is general information only. It does not constitute investment advice, a personal recommendation, or an offer or solicitation to enter into any transaction. Illustrative figures are not forecasts. Past performance is not a reliable indicator of future results.

You should consider obtaining independent financial and tax advice appropriate to your circumstances before entering into a margin facility.

This notice summarises the principal risks and is not exhaustive. The full terms governing your facility, including response windows and liquidation procedures, are set out in your facility agreement, which prevails in the event of any inconsistency with this page.