Contract Details: Limited Risk Option | CFD | CFD Trading | Contracts for Difference

Limited-Risk Option

Limited-Risk Option CFD (FX): Information Table

Limited Risk Option CFD (Indices) : Information Table

Notes to table

1. Limited-Risk Option CFDs are cash-settled futures and cannot be exercised by or against you or result in delivery of the underlying security. NOTE: This product is referred to in the Customer Agreement as a Limited-Risk Option CFD.
2. Each trading day we quote a number of Buy and Sell Risk-Limited Option CFDs on various underlying markets. Each Option CFD has a predetermined ‘Floor’ or ‘Ceiling’ set by us which is equal to the maximum potential loss of a relevant transaction and acts as a ‘safety level’. We take the following factors into account when making our Limited-Risk Option CFD prices: the level of the underlying market to which the Limited-Risk Option CFD relates; the distance that the relevant Floor/Ceiling lies from the level of the underlying market; the time to expiry of the Limited-Risk Option CFD; the volatility in the underlying market; and our remuneration and costs. The Limited-Risk Option CFD involves built-in guaranteed risk protection: the closing price of the Limited-Risk Option CFD can never breach the safety level (i.e. the Floor/Ceiling) of the relevant transaction.
3. Limited-Risk Option CFDs have set Determination Dates; however you are able to close the relevant positions at any time prior to one minute before the Determination Date. Even if the underlying market breaches the safety level, the price of your Limited-Risk Option CFD will remain at the safety level and the relevant positions will remain ‘alive’ either until the Determination Date or until you close the positions.
4. For a Buy Option of a Limited-Risk Option CFD, even if the price of the underlying asset falls below the strike price (the Floor) after opening the positions, you can keep the relevant positions until the expiry. You may newly open a Buy Option position at the Floor which is higher than the price of the underlying asset; however, you will incur losses unless the price of the underlying asset exceeds the relevant Floor on the Determination Date. Similarly, for a Sell Option of a Limited-Risk Option CFD, even if the price of the underlying asset exceeds the strike price (the Ceiling) after opening the positions, you can keep them until the expiry. You may newly open a Sell Option position at the Ceiling, however, you will incur losses unless the price of the underlying asset falls below the relevant Ceiling.
5. For a Buy Option of a Limited-Risk Option CFD, you can place a buy order to open a buy position only, and for a Sell Option, you can place a sell order to open a sell position. You cannot place any orders to open a sell position of a Buy Option, or any orders to open a buy position of a Sell Option.
6. The margin requirement for Limited-Risk Option CFDs is equal to the maximum amount which you would be capable of losing in respect of the relevant positions you open. If you are ‘buying’ a Limited-Risk Option CFD, this is calculated by deducting the buying price from the strike price (the Floor), multiplying it by the number of lot(s) you trade and further multiplying it by the profit/loss amount per lot per point. If you are ‘selling’ a Limited-Risk Option CFD, this is calculated by deducting the strike price (the Ceiling) from the selling price, multiplying it by the number of lot(s) you trade and further multiplying it by the profit/loss amount per lot per point.
7. For all Limited-Risk Option CFDs, we accept Market Order only and no limit order or stop order is available.
8. Limited-Risk Option CFDs expire in one day (23 hours) and cannot be rolled over. No receipt or payment of swap points arises from Limited-Risk Option CFDs.
9. When you trade in a currency other than your base currency (JPY or USD), your profit or loss will be realized in that currency then automatically converted to your base currency and booked to your account, by applying a relevant conversion rate calculated based on our standard rate and given costs.
10. Dealing may be suspended, or its start may be delayed or dealing hours shortened, depending on holidays and the actual situation of the underlying market.