Risk Warning Disclosure

Hoxton FX LTD

Effective: June 2024

Trading Contracts for Difference (CFDs) and foreign exchange (Forex) products involves a high level of risk and may not be suitable for all investors. These instruments are complex financial products that are traded on margin, meaning that you may lose more than your initial deposit. It is essential that you fully understand the risks involved and, if necessary, seek independent financial advice before trading.

Before opening a trading account with Hoxton FX LTD, we strongly encourage you to read this risk warning disclosure carefully, along with our Terms & Conditions, Order Execution Policy, Conflicts of Interest Policy, and other client legal documents available on our website. This document forms part of our Terms. Any capitalized terms not defined herein have the meaning ascribed to them in the Terms.

Understanding CFDs and Leverage

CFDs are derivative instruments that allow traders to speculate on price movements of various underlying assets, including but not limited to foreign exchange, commodities, indices, and shares. Trading CFDs comes with a high degree of risk due to leverage, which amplifies both potential profits and losses. A relatively small market movement can significantly impact your capital, and in some cases, you may be required to deposit additional funds on short notice to maintain your position. Failing to meet margin requirements may lead to the automatic closure of your positions.

Execution-Only Service

Hoxton FX LTD operates on an execution-only basis and does not provide investment advice, legal counsel, tax guidance, or financial recommendations. While we may offer general market information and trading insights, any decisions regarding the use of our services or the execution of trades remain entirely your responsibility. If you are uncertain about the implications of trading CFDs, we advise consulting an independent financial professional.

Client Responsibility and Risk Assessment

We are not required to assess whether our services or products are appropriate for you based on your financial situation, experience, or knowledge. It is solely your responsibility to determine whether your financial resources and risk tolerance align with your trading activities. We do not monitor your profits, losses, or deposits beyond standard margin requirements.

Key Risk Factors

1. Margin and Liquidation Risks

Margin requirements are subject to change at any time without prior notice. If your account equity falls below the required margin, your open positions may be liquidated automatically to prevent further losses. You should monitor your account closely to ensure sufficient margin at all times.

2. Market Volatility

Financial markets can be highly volatile, leading to rapid price changes that may affect the value of your positions. Gapping, slippage, and price fluctuations may result in orders being executed at less favorable prices than anticipated.

3. Currency Exchange Risks

If you trade instruments that are denominated in a currency different from your base currency, exchange rate fluctuations may impact your profits and losses.

4. Off-Exchange Trading (OTC Products)

CFDs are traded over-the-counter (OTC), meaning that transactions are executed directly with Hoxton FX LTD rather than on a regulated exchange. This introduces additional counterparty risk, as liquidity and pricing may vary from publicly quoted markets.

5. Electronic Trading Risks

Trading via electronic platforms carries risks associated with system failures, connectivity issues, and data errors. While we strive to maintain optimal platform functionality, there is always a possibility of technical disruptions beyond our control.

6. Margin Calls and Position Close-Outs

You must maintain adequate margin levels in your account. If your equity falls below the required threshold, Hoxton FX LTD reserves the right to issue margin calls or liquidate open positions to cover potential losses. It is crucial to monitor your account regularly to prevent unexpected closures.

7. Weekend and Holiday Risks

Market conditions may change significantly when trading resumes after weekends or public holidays, leading to price gaps and increased volatility. This could result in orders being executed at different levels than expected.

8. Corporate Events and Adjustments

CFD positions may be impacted by corporate actions such as dividends, mergers, and stock splits. While we aim to reflect market conditions, the treatment of such events in CFD trading may differ from holding the actual underlying asset.

Final Considerations

Trading CFDs and Forex involves inherent risks, including the potential loss of all invested capital. You should not engage in trading unless you fully understand the risks involved and have adequate financial resources to cover potential losses. Hoxton FX LTD does not guarantee protection from market fluctuations, and clients are responsible for managing their own trading strategies and risk exposure.

By opening an account and using our services, you acknowledge and accept the risks outlined in this disclosure. If you have any questions regarding risk management, please contact our support team before proceeding with trading activities.