Dear Customers! 

  

Renesource Capital keeps accurately tracking the events on the financial and capital markets in connection to the upcoming EU referendum in the United Kingdom (BREXIT), which is scheduled to take a place in the United Kingdom and Gibraltar on June 23, 2016, paying exceptional attention to prevailing nervousness and uncertainty in the currency markets in anticipation of the significant increase of market volatility and therefore a widening of market spreads in context of the outcome of EU referendum. 

  

The recent polls published in the United Kingdom contributed to intensified rise in volatility not only in Sterling (GBP) currency pairs, but also in Euro (EUR) currency pairs. In this regard, one month implied volatility in Sterling against US Dollar has risen to 29.0 points against 17.3 points at the end of May. While one month Euro against Sterling currency implied volatility has risen to 26.37 points against 15.78 points at the end of May. Furthermore, one month EUR against USD currency implied volatility has risen to 12.60 points against 9.67 points at the end of May. 

  

As a result of market uncertainty and high volatility forecasts, Renesource Capital has taken the decision to increase margin requirements for Euro (EUR) currency pairs, with the change being effective from the June 19th , 2016. 

  

Margin requirements will be increased to 5% for the following Euro (EUR) pairs: 

 

EURUSD 

EURAUD 

EURCAD 

EURCHF 

EURCZK 

EURJPY 

EURNOK 

EURNZD 

EURPLN 

EURSEK 

EURSGD 

  

Furthermore, we would like to note, that above mentioned risk management measures to manage specific event risk will have a short-term nature and are a subject to normalization after the BREXIT outcome (when volatility indicators in currency markets will stabilize) when margin rates will be reviewed. 

  

We strongly encourage all Clients to carefully consider the risks associated with trading around UK EU membership referendum dates. High volatility on Sterling (GBP) and  Euro (EUR) currency pairs may result in significant price gaps, widened spreads and slippages which may cause negative equity on client accounts (negative balance). It is strongly advised that Clients maintain appropriate and sufficient amount of margin on their trading accounts at all times. Volatility can trigger Margin Call and following Stop Out (Stop Loss) orders on your trading account. We recommend that Clients use Stop orders to limit risks. 

 

Events mentioned above may create market conditions where orders are difficult to execute and execution price of the order received strongly differs from the selected or quoted price due to market movement. Renesource Capital does not offer a negative balance protection thereby Clients can lose more than they have invested (Agreement Ref. Num. A.I.22, D.I.8 and D.I.10). 

  

We appreciate your understanding, 

  

Kindest regards, 

Renesource Capital