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Margin Trading - Foreign Exchange

Normal foreign currency trading yields a profit only when the currency being held goes up. With BOC Foreign Exchange Margin Trading Service leverage trading, you have the flexibility to capitalize on the forex fluctuations whether the market is rising or falling.

BOC Foreign Exchange Margin Trading Service

Briefing

BOC Foreign Exchange Margin Trading Service provides you an around-the-clock, secure and convenient online foreign exchange trading platform up to 16:1 leverage to capture investment opportunities. You can either trade,place market orders and manage your margin balance through our BOC FX Margin Trading Client Station or our service hotline “888 95566”.

Service offered

1. major G7 currencies trading

2. various kinds of market orders

3. up to 16:1 leverage

main currency pair trading

Currency pairs Starting amount of trading( increased by one lot in size) lot Size Starting Margin Deposit requirement (equivalent amount of USD)
EUR / USD
EUR / JPY
EUR / GBP
EUR / CHF
EUR 20,000 EUR 10,000 EUR 1,250
GBP / USD
GBP / JPY
GBP 20,000 GBP 10,000 GBP 1,250
USD / CHF
USD / CAD
USD / JPY
USD 20,000 USD 10,000 USD 1,250
AUD / USD
AUD / JPY
AUD 20,000 AUD 10,000 AUD 1,250
NZD / USD
NZD / JPY
NZD 20,000 NZD 10,000 NZD 1,250

Trading hours

1. BOC FX Margin Trading Client Station: - Monday 03:30 to Saturday 03:30

2. Service hotline “888 95566” - Monday to Friday (8:15am – 3:30am, next day).

3. During the brief maintenance time of our system every day,some functions of the trading services can not be used.

4. Trading hours will be announced separately when Macau and other major financial markets are closed. You can dial our service hotline “888 95566” for more detailes.

Handling charge

All the square positions are subject to a handling charge from your margin deposit. Each lot is USD1.00 for our FX Margin Trading Client Station or USD1.50 for our customers hotline “888 95566”. We keep the right to adjust the charges.

Trading Examples 

Example 1

Mr. Chan was a client of BOC Foreign Exchange Margin Trading Service.

On the morning of a day,the market rate for USD/JPY was 110.00/110.08. According to Mr. Chan’s estimation, the dollar would drop in short-term.

Therefore, he sold 2 lots of USD/JPY(he sold the dollar and bought yen) at 110.00, the total amount of the deal was USD20, 000. The margin deposit required was USD1, 250 (20,000 ÷ 16)

At that night, higher unemployment rate in the U.S weakened USD/JPY to 107.92/108.00. Mr. Chan decided to square his position by buying 2 lots of USD/JPY at 108.

In total,Mr. Chan successfully made a profit of 20,000 × (110- 108) = JPY40, 000, which was equal to about USD370.37. Thus, the rate of return from this trading was 370.37 ÷ 1250 × 100% = 29.63%.

Example 2

Mr. Chan was a client of BOC Foreign Exchange Margin Trading Service.

On the morning of a day,the market rate for USD/JPY was 110.00/110.08. According to Mr. Chan’s estimation, USD would drop in short-term.

Therefore, he sold 2 lots of USD/JPY(he sold USD and bought JPY) at 110.00,the total amount of the deal was USD20, 000. The margin deposit required wasUSD1, 250 (20,000 ÷ 16).

But,the dollar gained against yen at 110.30 later that day. Mr. Chan still held a bearish view on the dollar and kept his position without increasing his margin deposit.

One month later,the dollar rose to 114.96/115.04,which produced a unrealized loss of around USD876.83 : (110 – 115.04) × 20,000 ÷ 114.96= -USD876.83. The margin sufficiency ratio fell below 30%:(1,250 – 876.83) ÷ 1,250 × 100% = 29.85%.

Mr. Chan’s USD/JPY contract was squared automatically by our bank to prevent further losses. If the liquidation price was at 115.04, Mr. Chan would lose USD876.83.

If Mr. Chan had increased his margin deposit by USD100 before the liquidation deal,when the dollar rose to 114.96/115.04,his margin sufficiency ratio would have been 37.85%: (1,350 - 876.83) ÷ 1,250× 100% = 37.85%, and our bank would not have executed the liquidation.

owever,if the dollar kept rising against yen later,for instance, the dollar rose to 115.56/115.64, Mr. Chan would have a unrealized loss of USD976.12:(110 - 115.64) × 20,000 ÷ 115.56 =-USD976.12. The margin sufficiency ratio fell below 30%:(1,350 - 976.12)÷ 1,250 × 100% = 29.91%.

Mr. Chan’s 2 lots of USD/JPY contract would be liquidated by our bank to prevent further losses. 

Attention: Those examples above were only for showing the market risks and didn’t take other factors into account,such as overnight interest cost and handling charge.

Contract Us

If you have any other further questions, complaints and suggestions,please don’t hesitate to dial our service hotline “888 95566”.

Risk Disclosure :Trading foreign exchange on margin carries a high level of risk, and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to invest in foreign exchange you should carefully consider your investment objectives, level of experience, and risk appetite. The possibility exists that you could sustain a loss of some or all of your investment and therefore you should not invest money that you cannot afford to lose. You may be liable for losses that exceed the amount of margin that you post. You should be aware of all the risks associated with foreign exchange trading, and seek advice from an independent financial advisor if you have any doubts.

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