FXCM Markets becomes the latest cross-asset provider of margin derivatives to offer single-stock CFDs on the popular MetaTrader 4 platform. The firm informed traders through an email communication as well as updates on its FXCM Markets website and Daily FX portals’ forum.
The move could alter the CFD trading environment and challenge existing players that offer equity CFDs as FXCM becomes a competitor.
FXCM Markets outlined details of the new offering in an email which was sent to clients. The new offering will be available on the MT4 platform but users will need to open a new account in order to access the diverse instruments.
FXCM’s entrance into the equity CFDs segment comes as no surprise to industry professionals, as rival GAIN Capital, entered the space through the acquisition of GFT and City Index. Equity CFDs are popular financial instruments among retail and institutional investors, the long and short product is used by investors to hedge their existing share portfolio when stocks are performing poorly. In addition, institutional investors use the product to leverage-off current holdings during times of volatility.
FXCM Markets Equity CFDs
The broker updated its Daily FX news portal last month and provided a detailed FAQ on the matter with basic questions and answers on the topic. In addition, its website has details on the offering with a full market information sheet. Among the vast amount of products available, FXCM Markets offers equities from France, Germany, UK and the US, the world’s most liquid stocks.
The latest addition is a natural progression for the firm as it extends its current portfolio of currencies, commodities and stock indices and opens up new opportunities with a new client segment, particularly with the current bull run in global equities.
FX brokers looking to expand their product range into equity CFDs will need to embrace the necessary reporting requirements that come with the package. Trading in listed equities means that firms need to add a new layer of reporting under their transaction monitoring practices, coupled with increased reporting under EMIR, although FXCM Markets will not be required to follow EMIR rules as it is not regulated in the EU.