All CFD and Forex Brokers that are currently on the market have minimum order sizes (eg 1 CFD DAX). So a follower with a € 100 account can follow with the same risk as their top trader who has an account of say € 250,000, it has to be possible to trade quantities below the typical minimum order size. With a € 100 account that would translate to 0.001 DAX Units. In order to offer the best product on the market, we have therefore decided to establish ayondo markets to do just this.
ayondo markets is authorised by the Financial Services Authority ("FSA"), and will be supervised by the Financial Services Compensation Scheme ("FSCS" British compensation measures for financial services). The FSA (defined in more detail below) are designed to protect consumers and business customers and operate along very strict rules regarding client funds. ayondo markets is dedicated to the strict adherence of following these guidelines, literally and in spirit. In addition, the FSCS would compensate the customer if ayondo markets should not be able to meet its financial obligations.
Segregation means your money is kept separate from ayondo markets’ own business money in pooled client money bank accounts. These accounts are maintained with reputed banks.
ayondo markets follows ‘normal approach’ specified in CASS 7 of the FSA handbook. Under the normal approach, all the client money is directly deposited into client money account with a bank as soon as possible. A daily internal reconciliation of client money is performed and shortages, if any, are transferred immediately from our own money.
We ensure that stringent controls are in place to secure client money. Some of these are:
Daily internal reconciliations are performed to make sure that we have enough client money to pay all our retail client liabilities as and when requested.
Client money is only held in reputable global banks and periodic reviews are carried out to make sure that these banks are in good financial condition.
Regular client money reports are submitted to FSA demonstrating our liquidity and solvency.
All client money is held on deposit in Trust accounts with banks, so that any creditors of ayondo markets would have no legal right to it nor can ayondo markets use any of this money to cover its obligations, and is subject to controls and procedures required by the FSA.
Annual client money audit by a top-tier audit firm.
In addition, ayondo markets are covered by the Financial Services Compensation Scheme (“FSCS”). This means that in the unlikely event of ayondo markets being unable to meet its financial obligations, the FSCS could compensate for the shortfall up to £50,000 (or the equivalent in Euro).
The Financial Services Compensation Scheme (FSCS) is the UK’s compensation fund of last resort for customers of authorised financial services firms. The FSCS may pay compensation if a firm is unable, or likely to be unable, to pay claims against it. This is usually because it has stopped trading or has been declared in default.
It is independent of the government and the financial industry, and was set up under the Financial Services and Markets Act 2000, (Act of Law for financial services and Markets from the year 2000) becoming operational on 1 December 2001 (although it still covers claims from before this date). It does not charge individual consumers for using its service.
Please refer to the FSCS website: www.fscs.org.uk, or call +44 (0) 20 7741 4100 for more details.
Should ayondo markets goes into liquidation, it would be considered a ‘primary pooling event’ in the FSA handbook. In case of a ‘primary pooling event’, a client’s main claim is for the return of the client money held in the client money bank account. A client may be able to claim for any shortfall against money held in a firm’s own account. For that claim, the client will be an unsecured creditor of the firm.
If after the liquidation of the company, any client claim is not settled in full the client could approach the FSCS. The FSCS would be able to cover the shortfall to the extent of £50,000 per person.
Failure of a bank or third party, with which client money is placed by us, is considered a ‘secondary pooling event’ in the FSA handbook. In case of a ‘secondary pooling event’, money held in each general client money bank account and client transaction account (with third parties other than banks) must be treated as pooled. Any shortfall in client money that has arisen as a result of the failure of the bank/third party must be borne by all the clients rateably in accordance with their entitlements.
Just like in a Primary Pooling event (as in Q5), clients may approach the FSCS to settle any shortfall. As per current rules the FSCS will compensate up to the extent of £85,000 per person per firm for deposit claims or £50,000 per person per firm for investments. Please refer to the FSCS website for more details.