Risk disclosure
The twelve specific risks taken on by anyone trading CFDs with leverage, stated without softening. It is the shortest document in this section and the most important.
Trading contracts for difference (CFDs) with leverage carries a high level of risk and can lead to the loss of all deposited funds. These instruments are not suitable for every investor. 74% of retail investor accounts lose money when trading CFDs with this provider. Before you begin, assess your experience, your objectives and your financial situation.
- Summary of declared risks
- Risk of using leverage
- Market risk
- Volatility and gap risk
- Liquidity risk
- Risk arising from the absence of ownership
- Exchange rate risk
- Risk of holding a position
- Technology risk
- Risk of automated trading
- Absence of any guarantee of return
- Tax obligations
- Nature of the material on the site
1. Summary of declared risks
The twelve risks set out below, each with the mitigation available to the Client:
| Risk | Possible consequence | Available mitigation |
|---|---|---|
| Leverage | Loss of the entire margin on a 0.2% move | Reduce leverage and calculate position size |
| Market | Moves driven by causes beyond the parties' control | Stop loss and daily loss limit |
| Volatility and gaps | Stop executed at a worse price than the one set | Do not hold positions over high-impact events |
| Liquidity | Widened spread and worse execution | Trade during the instrument's liquidity hours |
| No ownership | No shareholder rights and no dividend in the proper sense | Understand the nature of a CFD before trading |
| Exchange rate | The result also depends on the conversion | Open the account in the payment method's currency |
| Holding a position | Swaps can exceed the potential profit | Calculate the swap before holding the position |
| Technology | Inability to trade due to a failure on the Client's side | Protective orders executed server-side |
| Automated trading | A run of losing trades caused by a logic error | Validate the strategy in the tester before enabling it |
| No guarantees | Past results do not anticipate future ones | Do not size positions on the basis of historical results |
| Tax obligations | The Client's responsibility according to tax residence | Exportable reports in PDF, CSV and XLSX |
| Nature of the material | Not a personalised investment recommendation | Check against your own professional advice |
2. Risk of using leverage
Leverage amplifies both the potential profit and the potential loss. A market move of 0.2% against a position at 1:500 leverage means the loss of the entire margin. A small price move can cause a significant loss relative to the amount contributed.
3. Market risk
Prices move because of factors beyond the control of the Company and of the Client: macroeconomic releases, central bank decisions, geopolitical events and changes in liquidity.
4. Volatility and gap risk
The price can move discontinuously, skipping intermediate values. In that situation the stop loss is executed at the first available price, which may differ substantially from the level set.
5. Liquidity risk
In periods of low activity — overnight hours, public holidays, the close of local markets — the spread widens and execution may occur at less favourable prices. In emerging-market currencies this effect is more pronounced.
6. Risk arising from the absence of ownership
A CFD confers no rights over the underlying asset, no shareholder rights and no right to receive dividends in the proper sense. Dividend adjustments are cash movements and are not equivalent to holding title to the security.
7. Exchange rate risk
If the instrument's currency differs from the account currency, the financial result also depends on the exchange rate applied on conversion.
8. Risk of holding a position
Swaps accrued daily can, over a prolonged hold, exceed the trade's potential profit. On the night from Wednesday to Thursday a triple accrual applies.
9. Technology risk
Failures of the internet connection, of hardware or of software can prevent a position from being opened, modified or closed. The Company is not liable for losses caused by circumstances on the Client's side.
10. Risk of automated trading
Algorithms execute their logic without assessing context. An error in the logic, incorrect parameters or unforeseen market conditions can produce a run of losing trades.
11. Absence of any guarantee of return
Past results, including those of strategies, analysis and educational material, are neither a guarantee nor a forecast of future results.
12. Tax obligations
Determining and paying taxes on the financial result is the Client's responsibility under the law of their country of tax residence. The Company does not provide tax advice.
13. Nature of the material on the site
Analysis, educational material and commentary are informational in nature, do not consider the recipient's personal circumstances and do not constitute a personalised investment recommendation.
Entity details
Sening Capital Ltd — registered office 12 John Princes Street, London, Westminster, W1G 0JR, United Kingdom, company registration number 11237561, licence FCA 806721.
All correspondence — legal matters, data protection, compliance and complaints — goes to the single address [email protected]. State the matter in the subject line so that the message reaches the right department.
In the event of any discrepancy between translated versions of this document, the English version prevails.
Frequently asked questions
Yes. Trading CFDs with leverage can lead to the loss of all deposited funds. Negative balance protection prevents a debt to the broker from arising, but it does not prevent the loss of the account's capital. The only defence against that loss is position sizing and the stop loss.
It is the percentage of this provider's retail client accounts that recorded a loss over the reference period. Publishing this figure is mandatory, and its purpose is to let the client assess the real probability of achieving a positive result before depositing.
Yes. In a market gap or during the release of high-impact data, the price can skip intermediate levels. In that situation the stop loss is executed at the first available price, which may differ substantially from the level set. This is not an action by the broker but the consequence of a break in liquidity.
Not in the sense of owning the share. CFDs confer no rights over the underlying asset and no shareholder rights. Dividend adjustments are cash movements on the account — credited on a long position and debited on a short one — and are not equivalent to holding title to the security.
The client. Determining and paying taxes on the financial result is the client's responsibility under the law of their country of tax residence. Sening Capital provides trade reports in PDF, CSV and XLSX, but does not provide tax advice.
No. Analysis, educational material and commentary are informational in nature, do not take the recipient's personal circumstances into account and do not constitute a personalised investment recommendation. Sening Capital also does not provide discretionary asset management services.