Margin trading in Germany
In Germany you can finance by margin trading up to 90 % of the value of purchased securities.
It is also possible to speculate on decline in stock indexes by purchasing of investment instruments which inversely replicate their development. It means that if the value of stock index decreases, the investment instrument behaves exactly the opposite, its value increases. Conversely, if the stock index increases, the value of the investment instrument is decreasing. In this case, margin trading can finance up to 85 % of the value of opened position.
Speculation on a drop in the price of individual securities, or to perform the operation known as a "short sale" is not possible in Germany.
How big a loan can be used?
- 90% for title EXS1 that replicates the index DAX
- 85% for title DXSN which inversely replicates the index DAX
- 90% for title EXW1 that replicates the Euro Stoxx 50
- 85% for title DXSP which inversely replicates the Euro Stoxx 50
- 80% for title exs2 that replicates an index TecDAX
- 80% for title EXS3 that replicates MDAX
- 80% for title C005, which replicates the index SDAX
- 70% for companies included in the DAX and Euro Stoxx 50
- 50% for companies included in the SDAX, MDAX and TecDAX.
Securities (stocks), which can be financed by margin trading with securities are stated in e-Broker application with symbol "M".
Notice
Investments into investment instruments are risky and may be unprofitable under unfavorable circumstances.
Trading in securities on margin (margin) is highly risky and is intended for experienced investors. As a result of leverage in case of unfavorable development of the rate, the loss multiplies, while in case of insufficient liability trader can close opened positions without prior contacting of client. Whichever securities may be excluded from the list of securities, even without notice, which may have negative consequences for the duration of the opened positions or the required amount of collateral. In an unsuccessful speculation on the rate drop (ie. Short Sale), the total loss can exceed the amount of own funds invested by the investor, because the growth of rate is theoretically unlimited. The amount of any profit is in addition to taxes negatively influenced also by fees paid for sales, records of investment instruments and the interest and fees paid in connection with the loaned securities or cash. Investments in foreign currency are connected with foreign currency risk, when yield may fluctuate due to currency rate fluctuations.
