Investors must bear risks for trades in the FX market. In this sense, before deciding to trade CFDs or currencies, you should carefully consider your investment targets, experience and risk preference, and do not invest all your funds in such an investment.
Your past trading performance cannot predict future results. You should pay close attention to market volatility risk including but not limited to possibilities of political or economic changes that may significantly affect currency prices or liquidity.
Leverage on funds in CFDs and FX trades means any market change may affect your deposits with the same leverage ratio. This change may be either favorable or adverse, and your loss may be higher than your initial funds, so that you have to make additional deposits to maintain your positions. If you fail to meet margin call requirements within the specified time, your positions will be cleared, and all you will have to bear all losses. However, you can lower your risk by using "stop-loss" or "target-price stop-loss" orders.
Taking possible software and hardware failures, and potential risks, including but not limited to various software and hardware faults, caused by Internet-based trading programs into consideration, IMS FX utilizes a backup system and has contingency measures in place to reduce system fault possibility as much as possible. It also supports telephone based trading.
IMS FX is committed to providing the best quote for customers at all times; however, in the case of market volatility or decrease in market liquidity, order placement may be affected by huge market volatility, which though rare, can occur in case of important economic data or news announcements. Within short-term market volatility, quotes may change greatly such that it is hard to execute orders. In such a case, although traders expect orders to be executed at certain prices, due to changed quotes, their orders may be executed at the earliest tradable prices. Also, trading volume may cause slippage. In this case, it is possible that there is insufficient liquidity to execute trades at designated prices.
Slippage is not exclusive to FX or CFD trades, and can occur in stock, futures and options market. IMS FX provides the best trading environment for customers. Its MT4 platform permits customers to set a tradable range to enhance possibility for order execution. For example, if a customer sets an acceptable range as 3 pips when placing an order, where the quote is different from the order price due to quick changes in market prices, the order will be executed at the earliest price within 3 pips. If the price is outside 3 pips, the order will be rejected.
If a trader places a resting order (stop) or sets stop-loss price, once it is reached, the order price becomes the earliest tradable price. In the case of rapid market volatility, no particular price can be ensured, and slippage may also occur for stop-loss and resting order (stop). By maintaining relationships with many large financial institutions, IMS FX can obtain quotes from different aspects, and provide the best quotes for customers. Furthermore, during periods of market volatility, due to large difference in quotes provided by different financial institutions, sometimes even if a desired quote is not available, IMS FX will provide the most competitive price, to enhance customers’ order placement efficiency.
If a LIMIT order is concluded, the trader will guarantee its target price. However, if the target price is not reached, the trader does not guarantee conclusion of LIMIT order or execution of stop-profit.
Generally, execution delay is due to Internet-related technical fault when the customer connects to the IMS FX server. For example, poor wireless signal intensity at the customer end, will cause unstable connection between the customer's computer and our server. In this case, please check all programs you are running, as programs consuming too much traffic may affect connection signal, causing abnormal connection to the trading platform and delayed data transmission between IMS FX ’s server and the customer platform.
In the event of market volatility (for example, announcement of important economic data), as the price acceptable to a trader has changed greatly at the time when an order can be executed, it is difficult to execute the order at the designated price. In this case, due to poor market liquidity, the order (resting order or limit-price order) may be rejected by the server and has to be reset.
IMS FX will always try to provide the best market spread for customers. However, the spread may also be outside of normal range in some cases, which often occurs when important news is released. Also, market liquidity will decrease due to sharp increase of ask and bid prices. Although higher spread may occur only for several seconds in general, they may also occur for several minutes at times. IMS FX suggests that customers should carefully hold positions when trading news are released, and pay attention to net value, ratio of used margin/available margin, and open positions in their respective accounts.
Although unacceptable quotes seldom occur, in special case when liquidity decreases, liquidity providers of IMS FX may greatly increase ask/bid spread due to influences of significant events; thus, there may be periods during which no trades can be made. Customers may be required to increase margins to avoid negative balance due to decrease in market liquidity.
As an international institution, IMS FX provides quotes to customers sourced from many large financial institutions. We make every effort to execute each customer order, however, online transactions may face technical issues. In special case, quotes may be interfered and reversed suddenly, which, only occurs for a short time, but during such time, customers cannot get real prices, and execution price may differ from real quotes. Since the concluding price is different from price offered by our liquidity providers, IMS FX may consider this trade as void and reserves the right to revoke the trade.
Business hours for IMS FX traders are typically from 5:00 pm on Sunday (EST) to 4:30 pm on Friday (EST). In few cases, these trading hours may vary because trade execution is determined by financial institutions providing liquidity.
Traders will update their quotes within a short time after market opening on Sunday (EST), to prepare for opening. At this time, the orders concluded at the end of previous week and not executed, may be updated to ensure orders are executed at real market price.
Due to weak liquidity during several hours after market opening, the spread is often higher before Tokyo and London markets open. This high spread occurs only when a few buyers/sellers are in the market, for example, the spread is increased when it is the weekend at most regions in the world.
Although typically, the opening price on Sunday is close to the closing price on Friday, it is also possible that the closing price on Friday greatly differs from the opening price on Sunday. Important news announcement or occurrences of significant events at closing time on Sunday change valuation of products by market and traders, and a gap may occur. If you intend to hold positions over weekends, you should be clear of this possibility. However, an advantage of trading on IMS FX is that our trading hours are much longer than these of most competitors, and we only close the market once per week, while most stock exchanges close five times each week, and stop trading on domestic and international holidays.
Some customers may feel uncomfortable about market gap or risk caused by important economic news and events that may occur during holidays and weekends. We strongly recommend that these customers do not hold positions at weekends, by closing all their positions before 4:30 pm on Friday (EST).
Margin trading enables a trader to own positions whose value is higher than his/her actual funds for trading. As required by customers, IMS FX ’s trading platform provides the most advanced margin management functions and higher leverage for traders. However, as leverage ratio is a double-edged sword, we warn customers that risks are involved in margin trading. If the net value in the account is almost lower than margin requirement, we hope that the customer can increase the margin immediately to avoid all positions from being closed. When available margin in your account is zero, all positions will be closed at the prevailing price, which typically occurs when net value in your account is lower than used margin (based on your margin ratio). During this process, IMS FX adopts no sequence for closing positions. At some time, net value when an order is executed may be lower than margin requirement, leading to negative net value or net value slightly lower than used margin, which generally occurs in the case of gap or strong market volatility. Therefore, IMS FX suggests that customers should set stops to limit falling risk, while maintaining proper margin amount and monitoring price, spread, margin ratio and market conditions when opening positions
Please note that although prices indicated on charts are reference trading prices, they may deviate from actual trading prices in a volatile market. Please keep in mind that reference price is only a suggestion about the market price. In this sense, reference prices provided by S&P and other institutions may be projections of actual market price movements. However, since FX and CFD trades are not centrally conducted in an institution like the stock market, the third-party prices you see cannot be treated as actual prices from liquidity providers, thereby leading to occasional differences between trading prices and third-party quotes.