IIROC Lowers Margin Trading Requirement for CAD

The Canadian self-regulatory organization IIROC, has issued an announcement about a pending increase in margin requirements on some foreign exchange (FX) pairs including the Canadian dollar (CAD), following a change in Volatility Volatility In finance, volatility refers to the amount of change in the rate of a financial instrument, such as commodities, currencies, or stocks, over a given time period. Essentially, volatility describes the nature of an instrument’s fluctuation; a highly volatile security equates to large fluctuations in price, and a low volatile security equates to timid fluctuations in price. Volatility is an important statistical indicator used by financial traders to assist them in developing trading systems. Trad In finance, volatility refers to the amount of change in the rate of a financial instrument, such as commodities, currencies, or stocks, over a given time period. Essentially, volatility describes the nature of an instrument’s fluctuation; a highly volatile security equates to large fluctuations in price, and a low volatile security equates to timid fluctuations in price. Volatility is an important statistical indicator used by financial traders to assist them in developing trading systems. Trad Read this Term, according to an IIROC statement.

The Investment Industry Regulatory Organization of Canada (IIROC) is tasked with the handling of the domestic regulatory environment, having enjoyed a unique structure as it regularly updates FX margin trading requirements depending on FX volatility.

More specifically, the IIROC has issued a revised table for all margin requirements of different currency pairs, with the notable change in the leverage ratio of the US dollar to the Canadian dollar (USD/CAD) and the Canadian dollar to the US dollar (CAD/USD).

Starting from January 21^st, the margin requirements on the USD/CAD pair will be lowered from 2.1% to 1.8%, while on the CAD/USD, Forex Forex Foreign exchange or forex is the act of converting one nation’s currency into another nation’s currency (that possesses a different currency); for example, the converting of British Pounds into US Dollars, and vice versa. The exchange of currencies can be done over a physical counter, such as at a Bureau de Change, or over the internet via broker platforms, where currency speculation takes place, known as forex trading.The foreign exchange market, by its very nature, is the world’s largest tradi Foreign exchange or forex is the act of converting one nation’s currency into another nation’s currency (that possesses a different currency); for example, the converting of British Pounds into US Dollars, and vice versa. The exchange of currencies can be done over a physical counter, such as at a Bureau de Change, or over the internet via broker platforms, where currency speculation takes place, known as forex trading.The foreign exchange market, by its very nature, is the world’s largest tradi Read this Term traders in Canada have a congruent 1.8%, down from 2.1% previously. These new FX spot risk margin rates replace a previous list provided by the IIROC back on December 14, 2015.

A full list of the IIROC’s rates, including its basket of twenty-one currencies, as of January 21, 2015 can be accessed by the following link.