BOARD

Brexit & FCA regulation

27 June 2016

As you possibly know, the UK voted “out” on the European Union membership referendum last week.

brexit-800x500

Many non UK customers are wondering about the implications for FCA (UK) regulated companies like Darwinex, who use a MiFID passport to operate in other EU countries.

Neither us nor our compliance advisors have the benefit of a crystal glass, but what we know is:

  1. Short term, until further instruction, it’s business as usual
  2. Medium term, 3 scenarios open up:
    1. Bregret: The UK decides that the outcome of the referendum wasn’t conclusive and backtrack
    2. Amiable divorce: UK – EU negotiations minimize change – no impact on investment activities
    3. Sour grapes: UK – EU exit negotiations turn sour, and UK leaves

Bregret

Whilst the outcome of the referendum was “out”, the result was narrow (51.9% vs. 49.1%) and unsurprisingly significant debate has emerged on whether a narrow simple majority outcome warrants the potential consequences of the exit effort.

At the time of writing, the UK has yet to formally invoke Article 50 in the Lisbon Treaty to request out of the EU. David Cameron has resigned and handed-over the decision to a new Conservative Leader – a successor unlikely to be found before October 2016.

A lot can happen between now and then…

Amiable divorce

Should the UK invoke article 50 the fact remains that:

  1. London is currently the EU’s unquestioned financial capital
  2. Most financial institutions in the EU had enough to worry about before Brexit
  3. In the event of a Brexit, most incumbents have more to lose by giving up the current status, than they have to win from any alternative set-up

Both sides to the table know this:

  1. The UK knows there’s an awful lot of jobs in South England at risk if London (and the FCA) loses their pre-eminent status
  2. The EU knows European Banks can ill afford another construction site looking for a new home to their capital markets activities

Which means: easiest way out would be to change everything for everything to remain the same. The Markets in Financial Instruments Directive (MiFID) is the master legislation that harmonises regulation for investment services… in the European Economic Area, which comprises the 28 EU member states plus Iceland, Norway and Liechtenstein.

If you ask a humble Fintech CEO, leaving MiFID as it is and applying it to 27 member states of the EU plus UK, Iceland, Norway and Liechtenstein looks like a relatively pain-free way out of the conundrum 🙂

In this scenario, when it comes to financial regulation, Brexit remain a wikipedia entry & a couple of weeks of stress in the market.

Sour grapes

Remainer or Leaver, the fact remains that a majority of UK citizens did vote to leave the EU.

The UK has sent a VERY clear message to European Union, and the message wasn’t lost on off-mainstream but growing political leaders in France, Netherlands, etc. who have requested follow-up referenda. This might tempt Ms Merkel into a hawkish stand on negotiation. Be tough with the Brits to fight off more referenda. The price to be paid would be sour divorce negotiations between the UK and EU: EU leaders would shoot the UK (hurt the City) in their own feet (EU banks would suffer the most).

Should grapes really turn sour, then thousands of European Financial institutions – including pretty much every European Fintech start-up – will seek a new home base to passport regulated activities into the remainder of the European Union. This will be a huge task with TONS of time wasted on tasks other than serving customers – which will imply a LOOOONGG transition period into an uncertain set-up.

Were this to happen, we’ll move giving plenty of notice & mutate into a legally new Darwinex, with the same old mission to serve active traders & investors.

The road from here: EVOLUTION!

Brexit or not, we still live in a world where the less you own, the worse you invest.

So, Mr. Cameron, Ms. Merkel, Mr. Johnson & Ms. Le Pen: go ahead and waste everybody’s time and money changing the fine print.

Meanwhile, we’ll continue to re-imagine the investing game: by the time the new UK Premier is even known and banks appoint their Brexit committees, we’ll have released a TON of functionality empowering active investors.

Bregret, Brexit or even end of the EU: the impact of Brexit on the independent traders’ movement is this blog-post.

Let’s face it, we’ve all got bigger fry going on.

Last News

Amended Trading Hours for Australia Day (26 January 2021)

21 January 2021

Please be aware that Australia Day will be held on 26 January 2021. Kindly note that during this time spreads may be wider and liquidity may be thinner. Also, the following amended trading hours will apply. Indices  Tuesday 26 January 2021 AUS200 06:11 – 22:00 UTC The rest of the assets will trade according to their usual […]

Please be aware that Australia Day will be held on 26 January 2021. Kindly note that during this time spreads may be wider and liquidity may be thinner.

Also, the following amended trading hours will apply.

Indices  Tuesday 26 January 2021
AUS200 06:11 – 22:00 UTC

The rest of the assets will trade according to their usual trading time.

See the full calendar of amended trading hours.

As always, at info@darwinex.com we’ll be happy to assist you!

Trading Hours for the US Martin Luther King Day on 18 January 2021

11 January 2021

Please note the amended trading hours that will apply on Monday 18 January 2021.

Please note the amended trading hours that will apply on Monday 18 January 2021.

🕤 All times in the following table are UTC (Coordinated Universal Time).
⚠️ During bank holidays spreads may be wider and liquidity may be thinner. They usually also give rise to changes to the applicable swap rates.
Commodities   Monday 18 January 2021
XAUUSD Early close at 17:43 UTC
XAGUSD Early close at 17:59 UTC
XTIUSD Early close 17:44 UTC
XNGUSD Early close 17:44 UTC
Indices
J225 Early close at 17:58 UTC
SPX500 Early close at 17:58 UTC
NDX Early close at 17:58 UTC
WS30 Early close at 17:58 UTC
US Stocks
All US stocks Closed

 

 

 

 

Related information:

As always, at info@darwinex.com we’ll be happy to assist you!

brexit

Brexit, the endgame: what you need to know in a no-deal Brexit scenario

16 December 2020

With the year coming to an end and Brexit coming into force on January 1st 2021, we would like to remind you that Darwinex is Brexit ready. Below are some updates for both existing and new customers. Please note that these will be relevant only in the case of a no-deal Brexit.

With the year coming to an end and Brexit coming into force on January 1st 2021, we would like to remind you that Darwinex is Brexit ready. Below are some updates for both existing and new customers. Please note that these will be relevant only in the case of a no-deal Brexit.

No-deal Brexit for existing EU customers

What changes in your relationship with FCA-regulated Darwinex in a no-deal Brexit scenario? In short: nothing, if you’re an existing customer.

  1. The FCA continues to protect your right to trade with us.
  2. Your monies remain with Santander UK, Natwest Bank or Sabadell UK in London.
  3. Your Funds enjoy FSCS deposit protection and Lloyd’s insurance for up to GBP 500,000.

Brexit doesn’t impair your right to trade with counterparties in 3rd countries outside the EU. You could trade with Australian brokers, you continue to enjoy the right to trade with UK brokers.

No-deal Brexit for new EU customers

For Darwinex, a no-deal Brexit scenario means restrictions to market to new EU customers with our FCA entity. We’ll shortly share details of our new license in the EU, which will offer identical conditions to our UK entity.

Our FCA-regulated UK entity will, in any case, continue accepting EU customers whenever reverse solicitation applies. Reverse solicitation means traders and investors approaching Darwinex on their own initiative and Darwinex not having solicited them to trade or invest.

We’ve recorded a podcast episode about Brexit and prepared a Brexit FAQ. Feel free to send to info@darwinex.com any questions you might have and we’ll answer them for everyone’s benefit!

Navidad

Darwinex Trading Hours for the 2020 Christmas & New Year Holiday Period

14 December 2020

The Darwinex Trading Schedule for the 2020 Christmas and New Year Holiday Period is already available in the calendar of Amended Darwinex Trading Hours.

Christmas is around the corner!

The Darwinex Trading Schedule for the 2020 Christmas and New Year Holiday Period is already available in the calendar of Amended Darwinex Trading Hours.

Note that during the Cristmas and New Year holiday period spreads may widen and swaps may be affected by the ‘turn’ effect. The ‘turn’ effect is a phenomenon that exists in financial markets which is caused by supply and demand for funding over key dates such as year or quarter-end. This can create anomalies in the forward curves for certain currencies, and we are already beginning to see this priced into the year-end swap points that we receive from our liquidity providers.

Further, you may want to check out what happens if you want to buy/sell a DARWIN which has underlying trades open with different opening/closing times.

As always, if you have any queries, please feel free to contact us at info@darwinex.com.

The Darwinex Team wishes you a Merry Xmas and a Happy New Year!

Trading Hours for the 2020 US Thanksgiving Holidays

17 November 2020

Please note the amended Darwinex trading hours for the upcoming US Thanksgiving holiday period on 26th and 27th of November 2020.

Please note the amended Darwinex trading hours for the upcoming US Thanksgiving holiday period on 26th and 27th of November 2020.

During bank holidays spreads may be wider and liquidity may be thinner. They usually also give rise to changes to the applicable swap rates.

All times are UTC.

 Instrument November 26th 2020 November 27th 2020
COMMODITIES
XAUUSD Close at 17:44:00
Close at 18:29:00
XAGUSD
Close at 17:59:50
Close at 18:14:50
XTIUSD
Close at 17:44:50
Close at 18:29:50
XNGUSD
Close at 17:44:50
Close at 18:29:50
INDICES
J225
Close at 18:00
Close at 18:15
SPX500
Close at 18:00
Close at 18:15
NDX
Close at 18:00
Close at 18:15
WS30
Close at 18:00
Close at 18:15
STOCKS
US Stocks Closed
Close at 17:59

The rest of the assets will trade according to their usual trading time.

As always, at info@darwinex.com we’ll be happy to assist you!

apalancamiento esma

NextEra Energy Stock Split 4:1

19 October 2020

The NextEra Energy stock split is approaching. At Darwinex we will apply the stock split on October 27th.

The NextEra Energy stock split is approaching. $NEE shares will be split 4-for-1. The number of shares will be multiplied by 4 and share prices divided by this same value.

At Darwinex we will apply the stock split on Tuesday October 27th at market open.

In live accounts we will adjust open position to the split without the need to close and reopen trades. Pending orders will be cancelled. In MT5, the hedged positions will be closed and the split will be applied to the resulting net position.

In demo accounts we will close all open positions in $NEE on Monday afternoon. Pending orders will be cancelled.

$NEE stocks will be available for trading from Tuesday, October 27th, at the post-split price.

As always, at info@darwinex.com we’ll be happy to assist you!

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. -- % of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.