Reverberations of Swiss Decision

Reverberations of Swiss Decision – Leverage Ratio is Brought to 1:100

In order to reap the best advantages of financial markets like Forex Market, one has to be prepared well for the fluctuations in the market. Sometimes, these fluctuations get the great intensity and strength and become much volatile to even small changes. Such an increase in the volatility comes up with the influencing decisions of the major contributors of the market. This similar incident has just been hit in the Forex market when the Swiss National Bank removed the cap limit from the trade of Swiss currency.

Reverberations of Swiss Decision

Right after this shocking announcement, many leading banks and LP’s just decided to bring the leverage ratio to a level of 1:100. This is to limit the uncontrollable trade of Swiss currency. In addition to the change in the leverage ratio for the investors, these entities have started to increase the margin requirements as well. In this way, all the ECN brokers will be experiencing a new leverage ratio to catalyze their financial transactions. This thing has brought the investors to a point where they have to think wisely to get the returns from their investment portfolios without getting affected much from these conditions.

Credit Risk and Major Contributors

There are many banks that are the leading contributors of this Forex Market. Now when these banks have come up with a counter strategy to shield them from the credit risk, it has become hard for the investors to make transactions the way they want to. Not even their brokers are steering them towards the high profits as they have been tied up by the LPs and banks by raising the margin requirement. In such conditions, CommexFx has been successful in providing the clients with the best investment portfolios that are not affected at all by this incident of Swiss currency’s cap removal.