Trading financial instruments offered by Ascends Global Markets Limited (“Ascends Global” or “the Company”), including Forex, Contracts for Difference (CFDs), Cryptocurrencies, Indices, Commodities, Equities, and other derivative products, involves a high level of risk and may not be suitable for all investors. These markets are characterized by volatility, leverage, and the potential for rapid and significant financial loss. Clients must carefully evaluate their investment objectives, financial situation, trading experience, and risk tolerance before participating in trading activities.
This Risk Warning provides a comprehensive overview of significant risks associated with trading. Clients are strongly encouraged to seek independent financial advice if they are unsure of the suitability of trading or the products offered by Ascends Global.
1. Leverage and Margin Risk
Trading on margin or using leverage allows clients to control positions much larger than their initial capital, which can magnify both potential profits and potential losses. Even small adverse market movements can lead to substantial losses, potentially exceeding the funds deposited in the client’s account.
Clients may be required to deposit additional funds at short notice to maintain open positions. Failure to meet margin requirements may result in the automatic closure of positions at a loss, and clients may be liable for any resulting account deficits. It is the client’s responsibility to understand and manage their exposure to leverage and margin requirements at all times.
2. Market and Price Risk
The value of financial instruments can fluctuate rapidly due to factors beyond the Company’s control, including market volatility, liquidity constraints, geopolitical events, economic data releases, and central bank policies. Prices quoted on Ascends Global’s platforms may differ from other brokers or market sources, especially during periods of high volatility or low liquidity.
There is no guarantee that stop-loss, limit, or other risk-limiting orders will be executed at the intended price. In volatile markets, orders may be executed at a less favorable price than expected, potentially resulting in greater losses than anticipated and vice versa.
3. Specific Risks by Asset Class
- CFDs: CFDs are complex instruments that allow speculation on price movements without owning the underlying asset. Leveraged trading can amplify both gains and losses, and adverse price movements can result in losses exceeding the initial margin.
- Forex: The Forex market operates 24 hours a day, offering high liquidity and profit opportunities. However, exchange rates can fluctuate significantly due to economic data, central bank decisions, and geopolitical events. Leverage in Forex trading increases potential gains and losses.
- Cryptocurrencies: Cryptocurrency markets are extremely volatile and can experience rapid, unpredictable price movements. Prices are influenced by technological developments, regulatory news, market sentiment, and liquidity. Trading cryptocurrencies carries a high risk of significant financial loss.
- Gold and Other Commodities: Prices of gold and commodities can be affected by inflation, interest rates, geopolitical events, and currency fluctuations. While they may act as hedges against certain risks, they remain susceptible to market volatility and may lead to substantial losses.
- Indices and Equities: Prices of indices and equities can be influenced by corporate performance, macroeconomic factors, and market sentiment. Trading these instruments involves the risk of loss due to market movements and liquidity constraints.
4. Risks Associated with Account Activity
- Withdrawal During Active Trades: Withdrawing funds from your account while open positions exist may affect total margin levels. Insufficient margin can lead to automatic closure of positions, potentially resulting in losses. Clients should ensure adequate margin before initiating withdrawals.
- Abuse of Deposit and Withdrawal Systems: Misuse of the deposit or withdrawal process, such as frequent transactions without genuine trading intentions, may be considered abuse of the system. Ascends Global reserves the right to impose fees, penalties, or restrictions on accounts in such cases.
5. System and Electronic Trading Risks
Trading through Ascends Global’s electronic platforms carries inherent risks related to hardware, software, internet connectivity, and network performance. System failures, disruptions, or delays can impact order execution, management of positions, and the ability to close trades. Ascends Global does not control third-party systems, internet providers, or local equipment and is not liable for losses arising from technical or communication failures.
6. Counterparty and Principal Risk
Ascends Global acts as a principal in most over-the-counter (OTC) transactions, which means the Company may be the counterparty to your trades. Trading prices and execution may be affected by market conditions. Clients are exposed to counterparty risk, including the possibility that the Company or other counterparties may default, leading to partial or total loss of funds.
7. Funding, Deposit, and Segregation Risks
Client funds are held in accordance with Ascends Global’s operational and regulatory practices. Depending on account type, trading activity, and margin usage, deposited funds may not always be held in segregated accounts. Clients should understand the protections available, especially in the event of counterparty insolvency or operational failures.
8. Costs, Fees, and Charges
Trading incurs costs including spreads, commissions, overnight financing, and other charges depending on the asset class and payment method. These costs directly impact profits and losses. Clients should obtain full clarity on all applicable fees before trading and incorporate them into their risk management strategy.
9. Foreign Exchange and Currency Risk
For accounts or trades denominated in currencies other than the client’s base currency, fluctuations in exchange rates may affect the value of deposits, withdrawals, profits, and losses. Clients are responsible for understanding the implications of currency conversions and associated charges.
10. Market Disruptions and Regulatory Risks
Unexpected events such as government interventions, trading suspensions, regulatory changes, or market disruptions can impact execution, pricing, and the availability of instruments. Such events may lead to delayed or partial order execution, increased volatility, and potential financial losses.
10. Market Disruptions and Regulatory Risks
Unexpected events such as government interventions, trading suspensions, regulatory changes, or market disruptions can impact execution, pricing, and the availability of instruments. Such events may lead to delayed or partial order execution, increased volatility, and potential financial losses.
11. Suitability and Client Responsibility
Clients must ensure that trading leveraged products, derivatives, or cryptocurrencies is appropriate for their financial situation and risk appetite. Only funds that clients can afford to lose should be used for trading. Clients are responsible for monitoring positions, understanding risks, and seeking independent financial advice if needed.
12. Risk Management Recommendations
Clients are encouraged to implement risk management strategies, including:
- Using stop-loss and take-profit orders where appropriate.
- Monitoring account balances and open positions regularly.
- Avoiding over-leveraging and maintaining sufficient margin.
- Staying informed about relevant market events, economic data, and geopolitical developments.
- Seeking professional advice if uncertain about trading decisions.
13. General Disclaimer
All information provided by Ascends Global, including market commentary, analysis, research, and pricing data, is for informational purposes only and does not constitute investment advice. The Company does not guarantee the accuracy, completeness, or timeliness of such information and accepts no liability for any loss or damage arising from reliance upon it.
Acknowledgment: By trading with Ascends Global, clients acknowledge and accept the risks associated with financial markets, including the potential for complete loss of deposited funds. Clients are advised to trade responsibly and seek professional guidance where necessary.
For any inquiries or further clarification regarding these risks, please contact our support team at support@ascendsglobal.com