The Client (hereinafter, “you”) should carefully read the Risk Disclosure in combination with the Client Service Agreement, and any other legal documentation/information available through our website.
Considering the risks involved, you should undertake any transaction only after comprehending the characteristics of the Financial Instruments you plan to trade, and the extent of risk exposure associated with such transactions. Engaging in the trading of high-risk financial instruments, such as Contract for Difference (CFD), may not be suitable for a considerable number of customers. Your decision to trade specific Financial Instruments should be made with careful consideration, considering your educational background, experience, investment objectives, financial status, and other pertinent circumstances.
You need to be aware that the value of your investments may rise or fall depending on market conditions, and you may not always record your initial investments. Past performance should not be regarded as a reliable indicator of future performance. If you find yourself uncertain about the suitability of any investment, it is advisable to seek independent expert advice. This Notice is directed to all clients and potential clients of the Company, urging them to thoroughly review the information provided before applying for a Trading Account or initiating any business relationships with the Company. It's important to note that while this document aims to provide insights, it cannot comprehensively disclose or explain all the risks and significant aspects associated with dealing in the Financial Instruments offered by the Company.
Trading Conditions Before initiating the process of opening a trading account, it is important that you engage in a thorough examination of the relevant legal documents. You should not only carefully read but also ensure a comprehensive understanding of acceptance of these legal documents, which can be accessed on the Company's official website at http://addup.net/. Furthermore, it is imperative for you to review all relevant information made available on the Company's website, as this plays a crucial role in establishing a clear understanding of the terms, conditions, and policies associated with trading activities.
General Cautionary Notes & Risks Associated with Transactions in CFDs: Before engaging in any investment activity or transaction, you should thoroughly assess whether trading specific Financial Instruments aligns with your educational background, experience, investment goals, financial position, and other pertinent factors. You should take into consideration at least the following: ● The Company cannot assure the initial capital of your portfolio or its value at any given time, nor can it guarantee the safety of any funds invested in financial instruments. ● You must recognize that despite any information provided by the Company, the value of investments in Financial Instruments can fluctuate in either direction, or there is a possibility that the investment may ultimately become worthless. ● You must acknowledge the significant risk of incurring losses and damages associated with the purchase and/or sale of any Financial Instrument and must be willing to accept and undertake this risk. ● You should refrain from participating in any investment in Financial Instruments, whether directly or indirectly, unless you possess comprehensive knowledge and understanding of the associated risks for each specific Financial Instrument. ● Past performance data of a Financial Instrument does not assure its present or future performance. Utilizing historical data does not create a reliable or secure prediction regarding the future performance of the Financial Instruments to which such information pertains. ● Certain Financial Instruments may not achieve immediate liquidity due to factors such as decreased demand, rendering it challenging for the Client to sell them or readily access information regarding their value or associated risks. ● If a Financial Instrument is traded in a currency other than the currency of your country of residence, fluctuations in exchange rates can adversely impact its value, price, and performance. ● Investing in a Financial Instrument on foreign markets may expose you to risks distinct from those typically associated with markets in your country of residence. In certain instances, these risks may be more substantial. Additionally, the potential for profit or loss from transactions on foreign markets is influenced by fluctuations in exchange rates. ● CFDs, typically involves non-delivery spot transactions, offering the chance to profit from fluctuations in currency rates, commodities, stock market indices, or share prices, referred to as the underlying instrument. The value of the Derivative Financial Instrument is directly influenced by the price of the security, or any other underlying instrument being acquired. ● You must not purchase a Derivative Financial Instrument unless you are willing to undertake the risks of losing entirely all the money which you have invested, and any additional commissions and other expenses incurred. ● Prices and terms of over-the-counter transactions are negotiated on an individual basis, without a centralized source for obtaining prices. Consequently, there exists a risk of inefficiencies in transaction pricing. ● Under certain market conditions it may be difficult or impossible to execute an order. ● Implementing Stop-Loss Orders is intended to mitigate losses. Nonetheless, in specific market conditions, the execution of a Stop Loss Order may occur at a price worse than its specified level, resulting in larger-than-anticipated losses. If your margin capital is inadequate to maintain current positions open, you may be required to deposit additional funds promptly or decrease exposure. Failure to comply within the specified timeframe may lead to the liquidation of positions at a loss, for which you will be responsible for any resulting deficit. ● The insolvency of the Company, Bank, or Broker could result in the forced closure of your positions, even if it's contrary to your preferences. ● There is a possibility that your trades in Financial Instruments could be subject to taxation or other duties, such as stamp duty, due to changes in legislation or personal circumstances. The Company cannot guarantee the absence of tax or duty obligations. Therefore, you are responsible for any taxes or duties that may arise from your trades. ● When the Company provides generic market recommendations, they do not constitute personal recommendations or investment advice. These recommendations have not considered any of your personal circumstances or investment objectives, nor do they serve as an offer to buy or sell or solicit an offer to buy or sell. Each decision to engage in a transaction with the Company, and each decision regarding the appropriateness or suitability of a transaction for you, should be independently made by you. The Company is not acting as an advisor. By agreeing to these terms, the Client acknowledges that the Company bears no liability for any liabilities, claims, damages, costs, and expenses, including legal fees, incurred as a result of following the Company's generic trading recommendations or taking or refraining from taking any action based on any generic recommendation or information provided by the Company. ● Trading financial instruments carries no assurances of profit or protection against losses. The Client acknowledges that neither the Company nor any of its representatives can provide such guarantees. The Client is aware of the risks inherent in trading financial instruments and is financially able to bear such risks and withstand any losses incurred. ● In the event of any quoting error, including errors in responses to Client requests or typing mistakes, the Company bears no responsibility for resulting errors in account balances. The Company reserves the right to rectify any necessary corrections or adjustments to the relevant accounts. ● Prior to commencing trading activities, it is imperative for the Client to acquire comprehensive information regarding all commissions and other relevant charges applicable to them. If any charges are not explicitly stated in monetary terms (e.g., dealing spread), it is your responsibility to seek and obtain a detailed written explanation, complete with suitable examples, to ensure a clear understanding of the implications of such charges in specific monetary terms. ● The Company will furnish all pertinent costs and charges or delineate them on the Company's website. You should be aware of these costs and charges as they may impact the profitability of your account. ● You must maintain the confidentiality of passwords and take measures to prevent third parties from accessing your online account. You will bear responsibility for trades executed using your password, even in cases where such use is unauthorized.
Communication between Clients and Company ● The Company is not liable for any loss caused by delays or failures in communicating with the Client. ● The Company is not responsible for losses resulting from unauthorized access to unencrypted information sent to the Client. ● The Company does not hold responsibility for messages not received. ● The Client is solely accountable for safeguarding the privacy of communicated information. ● The Client acknowledges that the Company is not liable for losses due to unauthorized access to the client's trading account by third parties. ● Telephone conversations will be recorded, serving as conclusive evidence of Client instruction.
Basic Risks in securities transactions The purpose of this Notice is to provide a fair and accurate overview of the risks associated with dealing with Financial Instruments in general terms.
5.1 Leverage Risk
Leverage risk refers to the potential for an investor to assume a greater risk than their initial capital investment. One of the key features of leverage is that even small fluctuations in the prices of underlying assets can result in amplified profits or losses. Engaging in leveraged investments can be highly precarious, as investors may end up losing more than their initial investment. Derivative Financial Instruments are characterized by a high level of "gearing" or "leverage." This arises from the margining system employed in such transactions, which typically requires only a small deposit or margin relative to the overall contract value. Consequently, even a minor movement in the underlying market can have a significantly magnified impact on the Client's trade. While favourable market movements can lead to substantial profits for the client, equally small adverse movements can swiftly result in the loss of the entire deposit, along with any additional commissions and expenses incurred.
5.2 Market Risk Market risk, also known as "systematic risk" or "non-diversifiable risk," represents the degree to which the return of a security fluctuates in correlation with variations in overall market returns. Market risks encompass uncertain events that may impact the entire securities market and the broader economy. This type of risk is inherent in investments and cannot be diversified away. When the market value of an investment declines, assets are diminished. Credit risk, exchange risk, country risk, and interest-rate risk, among others, contribute to price fluctuations. All investments are susceptible to market risk.
5.3 Credit Risk Credit risk originates when counterparties might not be able or willing to fulfil their agreed upon obligations. For example, this could be the failure of a security issuer to meet scheduled payments like dividends, interest, or loan repayments on time. The level of credit risk depends on how crucial the cashflows are, the likelihood of losing them, and the amount we could recover if the counterparty fails to fulfil their obligations.
Credit risk can occur in various situations: ● In contractual arrangements like options, where the counterparty is obligated to make future payments (such as in swaps) or might have to if the investor exercises an option they provided. ● In trading scenarios where an investor deals with a counterparty, such as buying stocks or engaging in currency exchange, but there's no immediate exchange of assets for cash. This introduces settlement risk because if the investor delivers something before receiving the end of the deal, there's a risk of loss if the counterparty goes bankrupt before fulfilling their part of the agreement. ● When an investor buys bonds, they effectively lend money to the issuer with the expectation that the issuer will make interest payments and repay the principal amount.
5.4 Inflation Risk Inflation represents the general increase in the prices of goods and services, typically measured as the percentage change in a price index. Inflation risk, then, is the potential for inflation to rise to the anticipated rate. The concern lies in the fact that inflation undermines the purchasing power of currency and/or investments, given that a positive inflation rate signifies a general increase in average prices.
Some of the effects of inflation are:
Reduction of Purchasing Power: Inflation leads to a reduction in the ability to purchase goods and services with a given amount of funds.
Disruptions to Financial Markets: Inflation can disrupt stock and bond markets, contributing to increased volatility.
Devaluation of Income on Interest-bearing Securities: The income earned on securities with fixed interest rates may suffer from devaluation due to inflation.
5.5 Operational Risk Operational risk denotes the potential for financial losses stemming from breakdowns in the systems and controls responsible for overseeing and quantifying risks and contractual obligations associated with transactions involving financial instruments. This risk extends to the processes of recording and valuing financial instruments, as well as the identification of human errors or system failures.
Operational risk losses can be classified into several interrelated categories:
Internal and External Fraud: This pertains to instances where individuals, whether within or outside the organization, violate regulations, laws, or company policies, resulting in substantial losses. Examples encompass activities like insider trading, rogue trader behaviour, computer crimes, and theft.
Clients’ products and business practice: Losses occur when businesses don't follow the right rules, like selling things to customers that aren't right for them, illegally moving money around, or trying to control the market unfairly.
Employment practices and workplace safety: This entail losses resulting from the failure to enforce necessary employment practices. This encompasses losses incurred from discrimination lawsuits and workers' compensation claims.
Execution, delivery, and process management: This encompasses various aspects, such as data entry errors, collateral management issues, failure to make accurate or timely regulatory or legal disclosures, and negligent damage to client assets.
5.6 Liquidity Risk liquidity risk happens when an investor wants to trade a security but can't find anyone willing to trade it in the market. It's basically the challenge of finding buyers or sellers on the desired terms. This risk comes from investments that are not easily bought or sold quickly enough to avoid or reduce losses. Securities that aren't traded frequently carry higher liquidity risk because it's harder to sell them without accepting a big discount from their current market value. Liquidity risk often shows up as a wide difference between the ‘’buying and selling prices’ (called bid-ask spread), significant price swings, and limited ability to buy or sell without affecting the price (known as market depth). It also includes the time it takes for prices to recover after a drop (market resiliency).
5.7 Exchange Risk Exchange risk, also called "currency risk," happens when dealing with international transactions. It's the risk of losing or gaining money because of unexpected changes in currency exchange rates, which are the prices at which different currencies are traded.
This risk is a big deal in international investing because it can affect the returns you get. When exchange rates go down, it can lower the value of your investments in foreign currency, however on the foreign exchange markets, there are chances for profit. One way to avoid this risk altogether is to invest only in your own country's currency.
5.8 Interest rate risk Interest rate risk addresses the potential impact in the value of an investment due to changes in the absolute level of interest rates, alterations in the spread between two rates, or any other relationships tied to interest rates. Currency risk, on the other hand, refers to the possibility that the value of an investment may be influenced by shifts in exchange rates. Interest rate risk is a big deal for bond owners. When interest rates go up, bond prices tend to drop, and when rates go down, bond prices tend to rise. This happens because when rates rise, other investments become more attractive compared to bonds, which offer fixed returns. So, if you have a bond with a fixed interest rate, like 5%, it becomes more valuable when rates fall because it's giving you a better deal compared to what you could get elsewhere in the market.
5.9 Economic Risk Countries that are still developing are more affected by changes in interest and inflation rates, which can swing a lot more than in richer countries. Also, these countries usually concentrate on a few things, so when something big happens, it affects them a lot and they have a lower capital base. Their financial systems often aren't set up well and don't have enough oversight.
5.10 Political Risk When a government is new or the political system isn't stable, it can lead to sudden and big changes in a country's economy and politics. As an investor, this can mean your belongings might be taken away without payment, your ability to control your belongings might be limited, or the worth of your belongings in certain industries might drop a lot because the government gets involved or puts rules and checks in place. In essence, international investors face the challenge of navigating country risk, recognizing that the political and economic dynamics of a foreign nation can significantly impact the financial outcomes of their investments.
5.11 Legal Risk The risk of changes in the legislation implies the possibility of suffering loss on foreign currency investments due to the introduction of new laws or changes in the existing ones, that includes tax regulations as well.
5.12 Additional Risks In addition to the risks already mentioned in our risk disclosure policy, there are some extra risks you should know about. These include the possibility that the market might not behave as expected, leading to losses.
High Risk of Active Trading: Active trading is very risky and not suitable for people with limited money, experience, or willingness to take risks. You might lose everything you invest. Don't use important funds like retirement savings or emergency money for active trading.
Be Wary of Big Profit Claims: Be cautious of ads promising huge profits from active trading. You might end up making little or no profit and even lose a lot of money quickly.
Need for Knowledge and Experience: Active trading requires deep understanding of the stock market and advanced trading techniques. You'll be competing with skilled traders, so you need proper knowledge and experience.
Understand Your Broker: Success in active trading depends on your broker's systems and practices. Learn how your broker operates before starting active trading.
Past Performance Doesn't Guarantee Future Results: Just because a stock or any other financial instrument did well in the past doesn't mean it will do well in the future. Historical data is only a guide, not establish a reliable prediction to the future success.
No Profit Guarantees: There are no guarantees of making money or avoiding losses when trading with the company or any other platform.
Market Volatility: Financial markets can change rapidly due to events beyond control. This volatility can affect your profits and losses. It should be noted that volatility can be unexpected and unpredictable regardless of the instrument you are trading on the company shall not be liable to any person for any losses, damages, costs, or expenses (including, but not limited to, loss of profits, loss of use, direct, indirect, incidental, or consequential damages) occurring because trades cannot be executed due to market conditions.
Internet Trading Risks: Trading online comes with risks like hardware or software failures, cyber-attacks, and communication problems. The company isn't responsible for these issues since does not control signal power and cannot be responsible for communication failures or delays with trading via internet.
Tax Considerations: Your trades might be subject to taxes or other duties. Company doesn't promise no taxes or duties will apply. Seek tax advice if needed.
Fees and Charges: Know the fees and charges of Company before trading, as these affect your profitability.
6.1 Extended trading hours risks
● Risk of Lower Liquidity: Liquidity means how easily you can buy or sell securities. More orders in the market mean higher liquidity, making it easier to trade at fair prices. Extended trading hours might have less liquidity, so your orders could be partially filled or not filled at all.
● Risk of Higher Volatility: Volatility is how much prices change when trading securities. More volatility means bigger price swings. Extended trading hours might have more volatility, so your orders could be partially filled, not filled, or filled at worse prices than usual. Such volatility can have a direct impact on the client’s profits and losses.
● Risk of Changing Prices: Prices in extended trading hours might not match regular market prices or prices when the market opens. You might get worse prices in extended trading hours.
● Risk of News Announcements: Important news about financial instruments can come out after regular market hours. In extended trading, this news combined with less trading activity or more price swings could make securities prices change a lot, but not in a sustainable way.
● Risk of Wider Spreads: The spread is the difference between buying and selling prices for security. Less liquidity and more volatility in extended trading might make spreads wider than usual for certain securities.
7.1 Differences between electronic trading systems
● Different electronic systems have varying ways of handling trading or routing orders. ● It's important to check the rules and regulations of the exchange where the electronic system operates. ● Understand things like how orders are matched, procedures for opening and closing trades, error policies, and any trading restrictions. ● Know the qualifications needed to access the system and the reasons for possible termination. ● Also, be aware of limitations on the types of orders you can place in the system. ● Each of these aspects can involve different risks when trading or using a particular system. ● Risks can also come from factors like system access, response times, and security. ● Internet-based systems may have additional risks related to access, response times, security, and dealing with service providers. ● There could also be risks associated with receiving and monitoring electronic mail.
7.2 System Failure Risks: Trading System Vulnerabilities: ● Engaging in electronic trading or order routing brings about the risk of system or part failures. ● If there's a system or component failure, you might face difficulties entering new orders, executing existing ones, or adjusting/cancelling previously placed orders. ● Such failures could also lead to losing orders or their priority status.
7.3 Simultaneous Open Outcry and Electronic Trading: Mixed Trading Methods: ● Some contracts offered electronically may also be traded through open outcry simultaneously. ● It's essential to check the exchange rules to understand how orders without specific instructions will be handled.
7.4 Internet Trading Risks: Risks of Internet-based Trading: ● Using an internet-based trading system carries risks such as hardware or software malfunctions and internet connection issues. ● We are not responsible for communication failures or delays due to factors beyond our control, such as internet signal strength or equipment reliability. ● Our liability doesn't cover losses caused by system failures, whether due to hardware, software, or internet issues.
7.5 Limitation and Liability: Liability Limitation Rules: ● Exchanges may have rules limiting liability for system failures, affecting brokers, software vendors, and damages you can claim. ● These limitations vary between exchanges, so it's important to review their rules to understand your rights and limitations.
The Company doesn’t insist on the comprehensiveness and accuracy of the above-mentioned information and is not liable for any loss or damage including but not limited by any profit loss that could take place directly or indirectly since the Client used or relied on such information. By coming at access to any information the Client confirms that he understands and accepts that the Company declines all responsibility for any losses originated in connection with inaccuracy of the provided information.
The Client understands that the Company declines all responsibility for consideration of all risks, using of financial resources and choosing of all appropriate trading strategy.
The Company declines all responsibility for the losses associated directly or indirectly with the limitations that are applied by the government, foreign exchange or market rules, interruption of trading.
The Company does not provide investment, financial, regulatory, legal, tax or other advice relating to investment or trading any financial instrument. Any material or information or other features, which may be provided to you through our website, trading platforms, marketing, or trading events or otherwise, is generic and shall not be treated as advice appropriate for your or based on a consideration of your personal circumstances. You should seek independent professional advice from a suitably qualified advisor, if necessary, prior to engaging in trading r any financial instrument with us.
Risk Beyond Company’s Control The Client and not the Company, is completely liable for the following risks the listing of which is not exceptive: a. Lack of knowledge of the trading terminal settings. b. Technical faults in the Client’s software. c. Disclosure of the registration credentials to the third parties at the opening of the real account. d. Unauthorized access by the third party to the personal email account of the Client. e. Reading with the delay of the information sent the Client’s email address. f. Any other force-majeure circumstances on the part of the Client
Past Performance Past performance, simulation, or prediction of financial instruments that company offers does not constitute an indication of future results. You should note that the value of your investment can decrease (as well as increase) as the market price of the underlying asset may fluctuate downwards or upwards.