Watchdog gets strict on CFDs

BRITAIN’S financial watchdog proposed tougher rules for retail financial spread betting products known as contracts for difference (CFDs) after finding that 82 percent of customers using them lost money. “We have serious concerns that an increasing number of retail clients are trading in CFD products without an adequate understanding of the risks involved, and as a result can incur rapid, large and unexpected losses,” the Financial Conduct Authority (FCA) said yesterday. CFDs are agreements between two parties to exchange the difference between the opening price and closing price of a contract. The FCA announced that it would introduce stricter regulations for CFDs to ensure that retail clients were aware of the high risks involved in trading in these “complex products”. – Reuters

CHINA