When a client opens a Saxo account, we classify the account according to a regulatory framework established by ESMA (the European Securities and Markets Authority), which oversees financial markets across Europe. By default, all accounts are categorized as retail. This classification ensures that the account is governed by industry-wide regulations designed to protect traders.
Retail client protections (ESMA)
On 1st of August 2018, the European Securities and Markets Authority (ESMA) introduced industry-wide rules and restrictions designed to protect retail clients from the risks of trading with leverage. Saxo strongly supports these rules as a positive measure to guarantee greater investor protection.
These measures include:
Retail clients
1. Leverage limits on the opening of a position by a retail client, which vary from 30:1 to 2:1 according to the volatility of the underlying instrument:
- 30:1 for major currency pairs;
- 20:1 for non-major currency pairs, gold and major indices;
- 10:1 for commodities other than gold and non-major equity indices;
- 5:1 for individual equities and other reference values;
- 2:1 for cryptocurrencies;
2. A margin close out rule on a per account basis. This will standardise the percentage of margin (at 50% of minimum required margin) at which Saxo is required to close out one or more of a retail client’s open CFDs;
3. Negative balance protection on a per account basis. This will provide an overall guaranteed limit on retail client losses.
Professional clients
Industry-wide regulations have been introduced and are designed to protect less experienced traders. The above-mentioned rules do not apply to professional traders. If you are a retail client and would like to trade with greater flexibility, you can apply for elective professional status.
If you meet at least two of the following criteria, you may be eligible to reclassify as an elective professional client.
Private account:
- Have a financial portfolio that exceeds €500,000.
- Acceptable examples of an investment portfolio can include cash savings, stock portfolio, stocks and shares, ISA trading accounts or mutual funds.
- Unacceptable examples include company pension, non-tradeable assets, property, luxury cars or jewellery.
- Have executed transactions of significant size in a specific product at an average rate of at least 40 transactions annually, with at least one significant transaction per quarter.
- Work or have worked in the financial sector for at least one year in a professional position that requires knowledge of a specific product.
In the case of a joint account:
- Both account holders must demonstrate that they have a financial portfolio that exceeds €500,000 each or €1 million in a joint bank/investment account.
- For example, if €800.000 is held in a joint account, then €100,000 must be evidenced in the name of each account holder.
- Both account holders must combined, have executed transactions executed transactions of significant size in a specific product at an average rate of at least 40 transactions annually, with at least one significant transaction per quarter.
- Trades can be shown in a joint account with Saxo or in a different broker account that is in a joint name.
- In case there is no trading account in a joint name, both account holders must show that they meet these criteria in their individual trading accounts.
- Both account holders must work or have worked, in the financial sector for at least one year in a professional position that requires knowledge of a specific product.
In the case of a corporate account:
- Have a financial portfolio that exceeds €500,000 (portfolio must be issued on entity name).
- Have executed transactions of significant size in a specific product at an average rate of at least 40 transactions annually, with at least one significant transaction per quarter. (statement should be issued on the name of the entity).
- All authorized dealers with trading rights must have worked in the financial sector for at least one year in a professional position that requires knowledge of a specific product.
| Qualifying products | Significant trade size |
| Certificates | EUR 5,000 |
| CFDs | EUR 30,000 |
| Bonds | EUR 25,000 |
| ETFs | EUR 5,000 |
| Mutual Funds | EUR 5,000 |
| Stocks | EUR 5,000 |
| Trusts | EUR 9,000 |
| Contract Futures | 2 lots |
| Listed Options | 3 lots |
| ETCs | EUR 5,000 |
| ETNs | EUR 9,000 |
| FX | EUR 30,000 |
| FX Options | EUR 10,000 |
| SRDs | EUR 10,000 |
| Turbos | EUR 10,000 |
| Warrants | EUR 10,000 |
How to apply for professional status?
You may request a change to professional status at any time directly from your account.
-
Log in to our platform and click on the main menu
> Your account > Account status > Request professional status
- Complete the simple form and submit any supporting information.
During the application, select the investment products for which you seek professional status, then answer the eligibility questions and pass an appropriateness (product knowledge) test for each chosen product. Read also: What is the Appropriateness / Product knowledge test?