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Forex.com Raising Margins on EUR Pairs Ahead of German Elections

Once again this year, markets will be dialed into European elections, this time regarding one of the largest players in the bloc, Germany. Consequently, ahead of the September 24 elections, Forex.com will raise minimum margin requirements in an attempt to protect clients against potential volatility.

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The German elections this month will see Angela Merkel battling for CDU/CSU to obtain a majority – however with an estimated 46 percent of Germans still undecided there remains the potential for a variety of different outcomes.

Taking no chances ahead of previous electoral outcomes, Forex.com will be safeguarding clients with new margin requirements starting on Thursday September 21, lasting until Tuesday September 26, 2017.

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Angela Merkel Bloomberg

With the EURUSD in central focus leading up to and during the elections themselves, the margin requirement changes will affect all EUR forex pairs, including the EURUSD – these pairs will see an increased minimum margin requirement to 1.0 percent. As the largest player in Europe, any electoral surprise could hold sizable consequences for the single currency.

Additionally, other instruments such as contracts-for-difference (CFDs) GER30 and FRA40 are also seeing their margin requirements increased to 1.0 percent starting next week on September 21. Each of these instruments represents the paramount benchmark index for the stock markets in Germany and France respectively.

Holding positions over the weekend is already risky enough due to concerns from geopolitical and global events that can take place when markets are closed. The margin increases reflect Forex.com’s attempts to avoid any potential fallout for their retail clients, which could potentially lead to significant profit/loss scenarios for unprepared investors.

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