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Risk Warning
Central Alliance Limited (hereinafter referred to as the company) is established in Seychelles, and has obtained the license and supervision of the local financial bureau (license number: 26670 BC 2022), and operates under the business name of FXCA.
This risk warning is used to describe the main risks associated with the trading of derivative financial products. Derivative financial commodities refer to commodity transactions whose prices are affected by physical prices, such as foreign exchange, stocks, bonds, gold, and crude oil. Futures trading, overnight interest trading, and financial commodity trading are all included in derivative financial commodity trading. Please be sure to read the following items carefully before trading.
The following descriptions are some of the risks that may occur in the transaction of derivative financial products, but not all possible risks. If the customer does not really understand the risks associated with derivative financial products, please do not make such speculative investment.
The price of derivative financial products is easily affected by customer factors and fluctuates violently, and the transaction amount will be higher than the margin, so it may cause a large amount of losses in a short period of time. Since derivative financial products are speculative investments, the company cannot guarantee that any losses will not occur. Transactions of derivative financial products are only suitable for investors who truly understand the risks and legal risks associated with transactions and who can afford their economic losses, not all investors. Clients are requested to seek objective advice from professional financial advisors before judging whether they are suitable for derivative financial product transactions. The company will not provide any advice. Derivative financial commodity transactions will be accompanied by the following risks, but not limited to the following risks.
1.1. Risk of Price Changes
The prices of foreign exchange transactions (FX) and futures, CFDs and other financial products will change due to political or economic factors around the world. Especially on weekends when the foreign exchange market is closed (Saturday morning to Monday morning in Japan time), if there is any change in the world situation, there will be a huge difference between the exchange rate on Monday and the previous Friday. In addition, when the customer trades in other currencies in the currency in the trading account, the price change of the target currency will also directly affect the profit and loss. If the loss point is set, the loss may be effectively suppressed to the minimum, but the loss may also be enlarged depending on the situation.
1.2. Risk of Interest Changes
The trend of interest is mainly affected by the economic climate and prices. Affected by changes in the interest rate level (policy interest rate), the prices of financial products may fluctuate significantly, but it is less likely to have an excessive impact on the overnight interest (adjustment of the interest difference between two countries). The amount of overnight interest changes on a daily basis, and there is a risk that the direction of payment may reverse.
1.3. Liquidity Risk
When financial policy changes or special circumstances such as speeches by important public figures, disputes or natural disasters cause drastic changes in the market, liquidity may be significantly reduced. In addition, there may be a decrease in liquidity regardless of the currency type during statutory holidays, market closures and market openings in various countries. When liquidity is low, the spread (spread) between the bid price (BID) and the ask price (ASK) may, in addition to widening substantially, the betting of new orders or the liquidation of holding orders may also be difficult to complete. situation.
1.4. Risk of Slippage
Slippage refers to the price difference between the order price and the transaction price when there is a communication or order processing problem between the user’s device and the company’s server. Slippage is more likely to occur when there are drastic changes in market prices due to factors such as the release of important economic indicators or the start of sudden activities, or when abnormalities and failures occur in system machines or communications. Slippage can sometimes be beneficial to the client (active slippage); conversely, there are situations that are detrimental to the client (passive slippage). After the slippage occurs, the transaction may not be carried out normally, resulting in the loss of profit or loss; depending on the situation, the order may not be executed or canceled normally.
1.5. Risk of Leverage
The financial product transactions provided by the company are all transactions with high leverage ratio, and high leverage ratio will be accompanied by corresponding risks. Trading with high leverage can make high profits with a small margin, but it may also suffer greater losses. Even if there is only a small movement in the market, the size of the loss will be magnified by the multiplier of leverage.
1.6. Swap Interest Risk
The overnight interest will be affected by various financial situations such as the interest rate trend of the target currency, price changes, etc., and it will change every day. It is allowed to lock the currency of emerging countries such as the Turkish lira to earn overnight interest, but it may also be necessary to pay overnight interest due to market changes. When overnight interest is required, it may be deducted from the balance in the trading account, or the order will be forced to liquidate.
1.7. Credit Risk
All the deposits of the company from customers will be custodial in banks in accordance with the law, and are clearly separated from the company’s original assets and managed separately. Although the management bank entrusted by the company has been selected after careful review by the company, since the custodian bank is not the object of regulatory protection, it may also affect the company’s property status according to the credit status of the company and its suppliers. Regarding the procedures for returning funds held in trust, the Company will not accept the request of the beneficiary to pay the funds to be returned directly to the Company through his agent.
The company will charge the customer a transaction fee for the transaction of financial products provided. The fees applicable to various exchanges can be confirmed on the “Transaction” and “Trading Commodities” pages of this site. Some commissions are shown in amount, and some are shown in percentage.
The price shown by the company to the customer includes the spread and the fluctuation. The client must ensure that in addition to the transaction amount, there is a sufficient amount to deduct the handling fee in the margin. In addition, if the customer conducts a transaction in a currency different from the one in the trading account, the price change of the target currency will also affect the handling fee. Therefore, before the transaction, please carefully evaluate the risks arising from the procedure.
The client’s transaction will not be the subject of any client compensation system based on Seychelles law. This risk warning may be restricted by the laws of countries other than Seychelles. In the event of any conflict between this risk warning and applicable laws and regulations, the latter shall take precedence
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