Definition

Trades, which have been placed/executed with funds borrowed from the broker are called marginal trades.

By default, all our clients can only trade using the funds they deposited into account themselves.

However, we offer our clients the opportunity to borrow funds from us to execute trades, if you are short on cash.

Please note that not all assets can be purchased with margin funds.

The amount of cash we can loan to you, depends on the current total value of your portfolio. Further information about how we assess your portfolio can be found below in the section “Risk Assessment”

Our offer (Representative example)

We provide our clients with margin funds at annual interest rate that published on our web-site https://m.tradernet.ru/anketa/price, which accrued and charged on a daily basis.

Example:

You borrow $1000 from us to trade stocks.

Your current cash wallet indicates a value of $-1000.

Your annual interest fee is $180 (18% of $1000). This annual fee will be broken down and charged to you daily.

$180 divided by 365 days is $0.49.

Every single day you will be charged $0.49.

On the next day your cash balance will be $-1000.49.

Marginal funds can also be withdrawn onto your bank accounts. Please note that this is only available if your trading portfolio supports cash withdrawals and our risk assessment allows it. (More information in the section “Risk Assessment”)

Your daily interests will be recalculated every day anew based on your negative balance in the respective currency. That gives you the freedom to deposit additional funds or exchange another existing currency in your cash portfolio at any time to reduce your negative balance and thus reducing the incurring interest fees.

How to enable

To enable investments on margin, head over to the order placement section of any asset and click on “Order Settings”.

Enable “Use margin” by ticking the box. After closing the settings, trades on margin will remain enabled for all future trades on all assets until disabled by you.

Risk Assessment

Under “Risks” next to the portfolio tab, you will find a comprehensive overview of how we assess your portfolio and determine how much marginal funds we can offer you at that moment.

Column 1 - Key Risk Indicators and Portfolio Cost

Own funds → The total value of your whole portfolio including all positions

Open position value → The total value of only your open positions combined

Leverage used → Some assets, such as 3x ETF, are considered as leveraged products. A combination of all your assets will be reflected here. Non-leveraged products are defined as leverage 1.0

Surplus Funds → Your portfolio value with consideration of active orders and initial margin

Risk level → How the system is currently evaluating your portfolios risk level

Capital adequacy level → Another summarised view of your risk level. The lower the percentage is - the greater the risk

Portfolio Cost → General overview of your whole portfolio and investments, including cash and asset values

Column 2 - Margin Requirements

Minimum margin size → (Assuming you are currently using marginal funds) If your entire portfolio value drops below this number, your margin level hits the red zone (graph from Column 3) and we will start closing positions

Initial margin → If your entire portfolio value drops below this number, your margin level hits the yellow zone (graph from Column 3) and you will no longer be able to open new positions.

Adjusted initial margin size → Each position or active order in your portfolio is influencing your margin requirements. The higher the discount amount, the higher will be your margin requirement.

Before making an investment, you can see in the asset information window, how much this asset would count towards your margin requirement.

Column 3 - Margin Level

You can see a graph which shows you the risk assessment of your portfolio in its current state.

If you are in the green zone, we will be able to loan you funds.

If you are in the yellow zone, we will NOT be able to loan you any funds. You will start receiving notifications about your positions and we will encourage you to take any form of actions to lower the risk of forced closure.

As soon as your portfolio assessment falls into the red zone, our risk managers will automatically close your positions to compensate for losses. They will start with the highest value position to close as least positions as possible. The gained cash will reduce your overall negative cash balance and thus lower the risk of your portfolio.

To prevent this from happening, you can either deposit additional funds into your trading account, or sell assets yourself to lower the negative cash balance.

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