The Australian Securities & Investments Commission (ASIC) has made an interim stop order preventing Stratos Trading Pty Limited (trading as FXCM) from issuing contracts for difference (CFDs) to retail clients, citing deficiencies in FXCM’s target market determination (TMD) under the design and distribution obligations (DDO). ASIC’s concern was that FXCM’s TMD inappropriately included investors with a medium risk appetite, which ASIC considers unlikely to be suitable for FXCM’s CFDs given the products’ leverage, volatility, liquidity and pricing risk. The order also prevents FXCM from opening trading accounts for new retail clients to trade the relevant CFDs, covering CFDs referencing currency pairs and forex baskets, treasuries and commodities, stock indices, stocks and stock baskets, and cryptocurrencies. Existing clients are not prevented from varying or closing their CFD positions. The interim stop order is valid for 21 days unless revoked earlier.
Australian Securities & Investments Commission2025-12-05
Australian Securities & Investments Commission issues interim DDO stop order against FXCM over CFD target market deficiencies
The Australian Securities & Investments Commission (ASIC) issued an interim stop order against Stratos Trading Pty Limited (FXCM), preventing it from issuing contracts for difference (CFDs) to retail clients due to deficiencies in its target market determination (TMD). ASIC found FXCM's TMD unsuitable for medium-risk investors given the leverage, volatility, liquidity, and pricing risks of CFDs. The order also restricts FXCM from opening new retail trading accounts, though existing clients can still vary or close their positions.