Leverage changes to 30:1 for major pairs | Forex Factory

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Leverage changes to 30:1 for major pairs

  • #1
  • First Post: Edited Jun 24, 2021 1:49am Oct 27, 2020 3:14am | Edited Jun 24, 2021 1:49am
Hello my name is Tom and I trade Forex in Australia.
I'm with Pepperstone and things have been going well as of late. Unfortunately, today I received news that ASIC (Australian Securities and Investments) are reducing the leverage on major pairs to a maximum of 30:1 as of March 2021 where the normal has been 500:1 ever since I can remember.
This is bad news for many traders as I use a highly effective EA that depends on equity to absorb the draw down. Unfortunately I don't qualify for Pepperstone Pro as I just started trading Forex again in June 2020 after an absence.

What's the motive behind the decrease in leverage? There is no reasonable excuse for the change except to make things more difficult.
  • #2
  • Oct 27, 2020 3:56am Oct 27, 2020 3:56am
With ridiculous leverage of 500x , it is a proven fact more people lose more money, way more quickly.

Reducing the leverage to 30x increases will potentially increase the percentage of retail traders that will be successful imo.

I mean you always hear only 10% of traders less are actually successful, hopefully that statistic will change.
  • #3
  • Oct 27, 2020 4:31am Oct 27, 2020 4:31am
Quoting tomislav
Hello my name is Tom and I trade Forex in Australia. I'm with Pepperstone and things have been going well as of late. Unfortunately, today I received news that ASIC (Australian Securities and Investments) are reducing the leverage on major pairs to a maximum of 30:1 as of March 2021 where the normal has been 500:1 ever since I can remember. This is devastating news for many traders as I use a highly effective EA that depends on equity to absorb the draw down. So as of March next year I think it's fair to say that I wont be trading Forex anymore....
you can join our rant thread here.

https://www.forexfactory.com/thread/...5#post13228105
  • #4
  • Oct 27, 2020 4:35am Oct 27, 2020 4:35am
Quoting cryptoking
With ridiculous leverage of 500x , it is a proven fact more people lose more money, way more quickly. Reducing the leverage to 30x increases will potentially increase the percentage of retail traders that will be successful imo. I mean you always hear only 10% of traders less are actually successful, hopefully that statistic will change.
you are wrong, nothing changes.
2 years on since ESMA implemented their changes, statistics of winners vs losers are still similar.

6 years since Japan and Singapore implemented their changes, statistics of winners vs losers are still similar, only thing that changed was that clients put up more collateral(ie more deposits).


at the end of the day, such regulation is not to protect "retail clients" but the brokerages from insolvency in the event of a blackswan event. after all, they are the ones that are paying millions in corporate taxes.
  • #5
  • Oct 27, 2020 6:58am Oct 27, 2020 6:58am
Quoting cryptoking
With ridiculous leverage of 500x , it is a proven fact more people lose more money, way more quickly. Reducing the leverage to 30x increases will potentially increase the percentage of retail traders that will be successful imo. I mean you always hear only 10% of traders less are actually successful, hopefully that statistic will change.
Admins please delete this entire post as there are people here who don't understand the advantages of high leverage in Forex.
Thank you.
  • #6
  • Oct 27, 2020 8:22am Oct 27, 2020 8:22am
You start a thread to discuss changes in Aussie trading rules, when someone expresses their views you get butt hurt. Don't start threads to discuss a topic, if you can not understand or accept an opposing view then!
  • #7
  • Oct 27, 2020 1:58pm Oct 27, 2020 1:58pm
Quoting cryptoking
You start a thread to discuss changes in Aussie trading rules, when someone expresses their views you get butt hurt. Don't start threads to discuss a topic, if you can not understand or accept an opposing view then!
I don't mind opposing views or opinions but when someone is saying something so utterly ridiculous and preposterous, in total antithesis to any logic... that's where I draw the line completely. Today we don't have opposing opinions... we have truth and utter bullshit and my friend.... you're talking bullshit. If you don't understand the advantages of high leverage then you shouldn't even be here.
  • #8
  • Oct 27, 2020 2:59pm Oct 27, 2020 2:59pm
Don't mind opposing views, certainly don't look like it by crying to admin about closing a thread YOU started and wanted to discuss. You have made three posts and yet have failed to answer why less leverage is a bad thing for the retail trader (borrowing less money from the broker as opposed to 500x your balance). I have traded with both high and low leverage brokers and have traded most markets. Just as high leverage has its advantages and disadvantages, using lower leverage has its advantages and possible disadvantages.

People lose money for various reasons, some blow their accounts using the 90/90/90 formula. For retail traders 90% of traders lose 90% of the allocated margin within 90 days the statistics tell us. However a major reason for this is under capitalisation, using excessive leverage, hoping to get rich quick. Most traders lose money, having less leverage will ensure more longer capital preservation, and be in the trading business longer. I believe it will increase the percentage of successful traders, even if by a small amount. If all major regulators are adopting these regulations surely their is benefit to the retail trader and not just the broker.
  • #9
  • Oct 27, 2020 7:03pm Oct 27, 2020 7:03pm
Quoting cryptoking
If all major regulators are adopting these regulations surely their is benefit to the retail trader and not just the broker.
Naive to believe regulators have your (or your brokers) best interests at heart.

Surely they could help better by only allowing people with a hundred thousand to enter Las Vegas, for the benefit of the gamblers and casinos of course.
  • #10
  • Nov 5, 2020 11:20pm Nov 5, 2020 11:20pm
I too want to leave pepperstone due to these caps. Does this affect all brokers in Australia? Are there any other good brokers to use which still offer the higher leverage?

Thanks in advance.
  • #11
  • Nov 6, 2020 2:59am Nov 6, 2020 2:59am
Quoting Fxsniper82
I too want to leave pepperstone due to these caps. Does this affect all brokers in Australia? Are there any other good brokers to use which still offer the higher leverage? Thanks in advance.
Fxsniper unfortunately this does affect every Forex Broker in Australia since they're all governed by ASIC. I'm considering moving to Alpari International. They look quite trustworthy actually. Worth a look.
  • #12
  • Nov 6, 2020 3:04pm Nov 6, 2020 3:04pm
Quoting tomislav
{quote} Fxsniper unfortunately this does affect every Forex Broker in Australia since they're all governed by ASIC. I'm considering moving to Alpari International. They look quite trustworthy actually. Worth a look.
Thanks mate I'll take a look. Have you heard of black bull? A broker in NZ which offers the same leverage as pepperstone once did. Got many good reviews, it's just difficult to know who to trust. I'll check out your recommendation, cheers.
  • #13
  • Edited 4:49am Nov 7, 2020 4:14am | Edited 4:49am
Quoting Fxsniper82
{quote} Thanks mate I'll take a look. Have you heard of black bull? A broker in NZ which offers the same leverage as pepperstone once did. Got many good reviews, it's just difficult to know who to trust. I'll check out your recommendation, cheers.
Thanks for that. Black Bull sounds good as they're close by and regulated. Deposits and withdrawals by Visa and Mastercard which is a relief so I'll get into touch with them actually. Hopefully New Zealand hasn't got any nasty ASIC style surprises down the road.
Much appreciated Fxsniper.
  • #14
  • Nov 7, 2020 10:48am Nov 7, 2020 10:48am
Quoting tomislav
{quote} Thanks for that. Black Bull sounds good as they're close by and regulated. Deposits and withdrawals by Visa and Mastercard which is a relief so I'll get into touch with them actually. Hopefully New Zealand hasn't got any nasty ASIC style surprises down the road. Much appreciated Fxsniper.
Check out global prime too. Not as much leverage as Blackbull but great reviews and is an Australian broker I think .
  • #15
  • Feb 13, 2021 7:48pm Feb 13, 2021 7:48pm
Quoting cryptoking
With ridiculous leverage of 500x , it is a proven fact more people lose more money, way more quickly. Reducing the leverage to 30x increases will potentially increase the percentage of retail traders that will be successful imo. I mean you always hear only 10% of traders less are actually successful, hopefully that statistic will change.
Who Switched Tranfered there pepperstone acccount? to pepperstone markets is it even worth it?
  • #16
  • Feb 18, 2021 4:02am Feb 18, 2021 4:02am
Quoting fron970
{quote} Who Switched Tranfered there pepperstone acccount? to pepperstone markets is it even worth it?
Pepperstone have several ways to qualify as a Pro Trader or as a sophisticated investor so you can keep the 500:1 leverage. Australian residents cannot transfer over to Pepperstone Markets due to ASIC regulations but if you're able to, then why not?
  • #17
  • Mar 13, 2021 5:28pm Mar 13, 2021 5:28pm
Quoting tomislav
{quote} Pepperstone have several ways to qualify as a Pro Trader or as a sophisticated investor so you can keep the 500:1 leverage. Australian residents cannot transfer over to Pepperstone Markets due to ASIC regulations but if you're able to, then why not?
You should have some worth for confirm as a pro. Not easy way
  • #18
  • Mar 13, 2021 5:31pm Mar 13, 2021 5:31pm
Quoting tomislav
{quote} Fxsniper unfortunately this does affect every Forex Broker in Australia since they're all governed by ASIC. I'm considering moving to Alpari International. They look quite trustworthy actually. Worth a look.
My friends didn't have good experience woth Alpari. This broker had some issues and now is 2 Alpari with different managers. You should research more about that
  • #19
  • Mar 15, 2021 3:06am Mar 15, 2021 3:06am
Quoting XfireSYD
{quote} with different managers. You should research more about that
Hmm, from what I've seen Alpari is a pretty decent company. There've been two Alpari companies - International and Limited - I think for more than 10 years each. Maybe your friends have registered in both so now they have 2 managers or something? I'd chat with their support for explanation btw.
  • #20
  • Mar 20, 2021 8:05am Mar 20, 2021 8:05am
Quoting fron970
{quote} Who Switched Tranfered there pepperstone acccount? to pepperstone markets is it even worth it?
Works the same after transferred to Pepperstone Markets. As long as it’s no longer regulated by ASIC, risks should be considered but I still go ahead.
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