Omada Global Limited (hereafter the “Company”) is a trading brokerage incorporated and registered under the laws of the Labuan Financial Services Authority.
Following the implementation of the company procedure, the Company provides this notice with information about the risks associated when clients are dealing with financial products. This notice cannot and does not disclose or explain all the risks and other significant aspects involved in trading financial derivative products.
1. Introduction
You are considering dealing using our trading platform for transacting in Spot FX and CFDs (“Trading Platform”). Spot FX and CFDs are derivative instruments which are considered high risk investments and may not be suitable for many investors.
This notice provides you with information about the risks associated with Spot FX and CFDs, but it cannot explain all of the risks nor how such risks relate to your personal circumstances. If you are in doubt you should seek professional advice.
It is important that you fully understand the risks involved before deciding to enter into a trading relationship with us. If you choose to enter into a trading relationship with us, it is important that you remain aware of the risks involved, that you have adequate financial resources to bear such risks and that you monitor your positions carefully.
The burden of all risks involved in any Spot FX and CFD will be borne by you, and we are not responsible for any losses which you incur, of whatever nature and whatsoever arising.
2. Trading is considered to be risky and speculative
The Client is responsible for all the losses suffered in his account. Consequently, the client should be prepared to lose all the invested capital.
Do not invest with money you cannot afford to lose. An investment in Spot FX and CFDs carries a high degree of risk to the investor and for reasons including those stated herein, you may lose more than or all your initial investment amount.
3. Potential losses
When you trade on margin, you should be prepared to lose more than or all your initial investment amount that you have deposited as margin to the firm.
You can lose all or more than the balance of your Trading Account.
4. CFDS are not suitable for long-term investment
CFDs are not suited to the long term investor. If you hold a CFD open over a long period of time the associated costs increase, and it may be more beneficia to buy the underlying asset instead.
5. No rights to underlying instrument
CFDs do not provide any right to the underlying instruments, or in the case of Equity CFDs, to voting rights.
6. Leverage
Before the client opens a trade, he is required to maintain a margin. Margin is usually a relatively modest proportion of the overall contract value. This meam that the client will be trading using "leverage". The "leverage" is often obtainable in trading. This means a relatively small market movement can lead to a proportionately larger movement in the value of the client's position and this can work either against or for the dient. The greater the leverage, the greater the risk.
At all times during which the client opens trades, he must maintain enough equity, considering all running profits and losses, for meeting the margin requirements. If the prices move against the client then the client must deposit funds to avoid any margin calls, otherwise the company will be entitled to close one or more or all the client's trades regardless of whether the client agrees with the Company's decision to close his trade(s).
Omada Global Limited will impose a maximum leverage limit of 100:1 on its clients' trading transactions that would translate to a minimum of 1% margin deposit to enable the opening of a trade position. For illustration purpose, assuming that the transacted volume is USD100,000, the minimum margin requirement will be equivalent to USD1,000.
7. Underlying Market Volatility
Spot FX/CFD is an instrument that allows the client to trade on price movements in underlying markets/instruments. The Company's prices are derived based on the underlying instruments/markets.
It is important for the client to understand that the fluctuation of the underlying instrument may influence the value of the derivative product and affect the client's profitability. The client should also be aware of "gapping" where such events can result in a significant profit or loss on the client's account. "Gapping" can occur when the underlying instrument/market is open and when it is closed.
Trading Spot FX/CFDs is only appropriate for those customers who fully understand the risks and have previous trading experience. If unsure, it is advisable to seek independent advice.
In the event of unexpected market conditions (halt of trading), the firm may require clients to increase the margins, pay up the contract value in full, or close their positions at an appropriate price determined by the firm.
In the worst case, clients could lose more than 100% of their contract value. Clients may also be liable to pay additional charges, costs and fees Incurred.
8. Stop loss limits
There are some circumstances in which a 'stop loss' limit is ineffective, for example, where there are rapid price movements or market closure. Stop limits cannot always protect you from losses.
9. Execution risk
Execution risk is associated with the fact that trades may not take place immediately. For example, there might be a time lag between the moment you plac your order and the moment it is executed. In this period, the market might have moved against you. That is, your order is not executed at the price you expected.
When trading after the market is closed, be aware that the prices for these trades can differ widely from the closing price of the underlying asset. In many cases, the spread can be wider than it is when the market is open.
10. Time may not be on your side
If you do not have enough time to monitor your investment on a regular basis, you should not trade complex financial instruments. These products are not suitable for buy and hold trading. They can require constant monitoring over a short period of time. Even maintaining your investment overnight exposes you to greater risks and additional costs. The volatility of the market together with the extra leverage on your investment can result in rapid changes to your overall investment position. Immediate action may be required to manage your risk exposure or to post additional margin.
11. Cost and Charges
Clients should be aware of all relevant costs and charges that may influence the account profitability of the client.
In addition to any profit or losses, there are different types of costs linked to transactions. Costs will impact the effective return. Examples of costs include commissions charged by the Company. Costs related to FX trading may also include bid-offer spreads, interest rate swaps, account management fees and taxes. These costs can be complex to calculate and may outweigh the gross profits from a trade.
12. Swap Values and Charges
If a client holds any positions overnight, an applicable swap charge will apply. The swap rate is mainly dependent on the level of interest rates as well as the Company's fee for having an open position overnight. The Company has the discretion to change the level of the swap rate at any given time. The Client further acknowledges that he is responsible for reviewing the contract specifications and for being updated on the level of swap value prior to placing any order with the Company.
13. Complex Instruments Warning
Complex Instruments are derivatives products for which special risks apply. This notice is provided to you as a retail client in compliance with the rules of th Labuan Financial Services Authority. This notice cannot disclose all the risks and other significant aspects of complex instruments. You should not deal with complex instruments unless you understand their nature and your exposure to risk. You should be satisfied that the product is suitable for you in light of your circumstances and financial position. Although complex instruments can be utilized for the management of investment risk, some of these products a unsuitable for many investors. Different instruments Involve different levels of exposure to risk and in deciding whether to trade in such instruments you should first acquaint yourself with the risks associated with the investments. Independent financial advice is necessary if you are unsure whether such complex instruments are appropriate for you.
14. Electronic Trading
Electronic trading facilities are supported by computer-based component systems for the order-routing, execution, matching, registration or clearing of trades. As with all facilities and systems, they are vulnerable to temporary disruption or failure.
Trading on an electronic trading system may differ not only from trading in an open-outcry market but also from trading on other electronic trading systems If you undertake transactions on an electronic trading system, you will be exposed to risks associated with the system including the failure of hardware and software. The result of any system failure may be that your order is either not executed according to your instructions or not executed at all.
15. Currency Risks
You should be aware that trading denominated in a currency other than your home currency has the additional risk associated with currency fluctuations. The value of your return may be affected by its conversion into the home currency.
16. Client Money and Counterparty Risk
All funds and currencies belonging to you ("Client Money") shall be held by us in a segregated client money bank account; and are subject to a right of off-set for all liabilities that you owe to us. Segregated client money is deemed Client Money for the purposes of Labuan PSA rules & regulations, and is held with a bank. Client Money is segregated from the Firm's own money but is commingled with the money of other customers of Omada Global. In the event that the bank becomes insolvent, you may be exposed to the risk that the money recovered by us from the bank is insufficient to satisfy your claims in respect of your money held with the bank.
We may place your funds in our segregated Client Money account in a different currency to your base currency. Such Client Money will be at least equal in value to your base currency and will be in compliance with Labuan FSA regulatory requirements. No interest is due or will be paid in respect of Client Money.
Given that you are dealing with Omada Global as the counterparty to every transaction, you will have an exposure to us in relation to each of your transactions and are reliant on our ability to meet our obligations to you under the terms of each transaction. This risk is sometimes described as 'counterparty risk'.
17. Communications between client and the "Company"
The Client shall accept the risk of any financial losses caused by the fact that the Client has received with delay or has not received at all any notice from the company.
The Client acknowledges that the unencrypted information transmitted by email is not protected from any unauthorized access.
The Company has no responsibility if unauthorized third persons have access to information, including electronic addresses, electronic communication and personal data, access data when the above are transmitted between the Company and the client or when using the internet or other network communication facilities, or any other electronic means.
18. Client’s Acknowledgement
The client hereby acknowledges and declares that he has read, understood and thus accepts without any reservation all the information included herein including the following:
The value of the Financial Instrument (CFDs or any other derivative product) may decrease and the client may receive less money than originally invested or the value of the financial instruments may present high fluctuations. It is possible that the invested capital may become of no value.
Information on past performance of a Financial Instrument does not guarantee the present and/or future performance. The use of historic data does not constitute a binding or safe forecast as to the corresponding future return of the Financial Instruments to which such data refers.
Some Financial Instruments may not become immediately liquid due to various reasons such as reduced demand and the Company may not be in a position to sell them or easily or obtain information on the value of such Financial Instruments or the extent of any related or inherent risk concerning such Financial Instruments.
When a Financial Instrument is negotiated in a currency other than the currency of the client’s country of residence, any changes in an exchange rate may have a negative effect on the Financial Instruments’ value, price, and performance.
A Financial Instrument in foreign markets may entail risks different from the usual risks in the markets at the client’s country of residence. The prospect of profit or loss from transactions in foreign markets is also influenced by the exchange rate fluctuations.
