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Risk Warning

VIBHS Financials Ltd, a leading financial intermediary providing trading solutions is an FSC (Financial Services Commission, Mauritius) regulated company holding a Category 1 Global Business License.

References to "VIBHS" in this risk warning document shall mean VIBHS Financials Ltd unless otherwise stated. In the best interest of our clients it is imperative for all traders who are keen to become VIBHS clients, to be informed about the execution and various other risks involved with trading at VIBHS.

VIBHS recommends traders and clients to read this risk document carefully.

Here our clients and prospects will find detailed information about execution and various other risks associated with VIBHS but not limited to its products/financial instruments, trading technologies, execution types and services.

High Risk Products/Financial Instruments

Trading Currency (Fx), CFDs, Forwards, Options, other derivatives and leveraged products/financial instruments on margin carry a high risk, and may not be suitable for all traders/clients and investors. Before deciding to trade products/financial instruments offered by VIBHS Financials Ltd ("VIBHS") a client should carefully consider his/her expertise, knowledge, objectives, financial situation, needs and level of experience. VIBHS is a registered Global Business License Category 1 company having investment dealer license (full services) and regulated by FSC (Financial Services Commission), Mauritius. VIBHS either directly, through its' associate company/companies and/or third party may provide general advice, reports, news, data and other materials that do not take into account specific objectives, financial situation or needs of individual clients. The content of this website and any other website of the group companies, its' associated companies must not be construed as personal advice or as an attempt by the VIBHS to solicit business or an attempt of persuasion for trading. The possibility exists that a client could sustain a loss of some or all of his/her deposited funds and therefore, client should not speculate with capital that he/she cannot afford to lose. A client should be very aware of all the risks associated with trading on margin and associated financial risk. VIBHS recommends its clients to seek advice from an independent financial advisor and/or apply his/her own prudent decision.

Market Views and Opinions

News, research, analysis, prices, views on market, market trends and news on economy, opinions or/and other information contained on this website is provided as general market commentary, and does not constitute investment/trading advice. VIBHS will not accept liability for any loss or damage, including but not limited to, any loss of profit, which may arise directly or indirectly from use of or reliance on such information.

Risks Associated with Internet and Technology

There are risks associated with an Internet and Technology based trade execution system including, but not limited to, the failure of hardware (crash of computer, server), software, and internet connection. Since VIBHS does not control transmission, signal power, its reception or routing via the internet, configuration of your electronic and trading equipments or reliability of internet connection, VIBHS together with its shareholders, directors, management, employees, business associates, strategic partners, introducing brokers, white label partners, vendors and service providers cannot be responsible for communication failures, distortions or delays when trading via the internet. VIBHS employs backup systems and contingency plans to minimize the possibility of system failure, which includes allowing clients to trade via telephone, live chat service or other means, as an alternative. Execution of order through telephone or alternative means may attract additional charges and such charges would be notified to the clients.

Market Depth and Liquidity

During the trading hours at various intervals, market for a particular product/financial instruments may become less liquid/active. This may occur when market is not very active and due to dramatic turn of socio, economic & political event, terrorist attack, war and civil unrest etc. This may happen across all products/financial instruments or few select products/financial instruments. Less liquidity or thinner markets may result in wider spreads, as there are fewer market participants. In illiquid markets, clients may find it difficult to enter or exit positions at their requested price, experience delays in execution, and receive a price at execution that is significantly away from requested price. It may also impact their P/L, clients may get margin call and/or trading may get suspended for some time.

A client must carefully select a product/financial instrument prior to any trading decision as in all financial markets; some instruments within that market will have greater depth of liquidity than others.

Execution Delay

There is possibility of delay in execution of clients' orders. This may occur for various reasons, such as technical issues with the clients internet connection to VIBHS or by a lack of available liquidity in the product/financial instrument that client is attempting to trade. Due to inherent volatility in the markets, it is imperative that clients have a working and reliable internet connection. There are possibilities that the client's personal internet connection may not be maintaining a constant connection with the VIBHS servers due to a lack of signal strength. A disturbance in the connection path can sometimes interrupt the signal and disable the VIBHS Trading Station, causing delays in the transmission of data between the trading station and the VIBHS server.

Execution Slippage

It is VIBHS endeavour to provide clients with the best execution available and to get clients' orders filled at the requested rate/price. However, at times, including but not limited to, due to an increase in volatility and spurt in price, orders may be subject to slippage. Slippage most commonly happens due to an increase in volatility during fundamental news events or periods of limited liquidity. During periods such as these, client' order type, quantity & rate/price demanded, and specific order instruction e.g. Limit Order can have an impact on the overall execution of his trades.

The high volatility in the market at times creates conditions such that orders are difficult to execute. A client might select a rate/price to execute his trade. Here, the client tries to execute his trade at a certain rate/price but in a split second, the market may have moved significantly away from that rate/price. The clients order would then be filled at the next available price for that specific order.

VIBHS provides a number of basic, advanced and specific order types to help clients mitigate execution risk. To view more information regarding order types at VIBHS, please click on the link below

Order Types

VIBHS different trading systems support different types of orders, we caution clients to please be confirmed about the various types of orders that are supported by various systems. It is possible that some order types that are existing in the respective systems either be removed or new order types are introduced or both without prior notice and they are not updated. VIBHS does not promise that the VIBHS system will support all order types under all market conditions, there might be certain market scenarios including but not limited to opening session, closing session, immediately before and after economic news events & data releases, untoward events like, war, terrorist attacks, political crisis and civil unrest etc. where some or all order types are made dysfunctional/non operative.

Order Types

Preference between Execution and Price

The high volatility in the market at times creates conditions such that orders are difficult to execute. A client might select a rate/price to execute his trade but in a split second, the market may have moved significantly away from the rate/price at which VIBHS is able to execute the trades.

Where the liquidity depth is not large enough to fill a Limit Entry and Limit Order, the order will not be executed instead remain in the system until the order can be filled. Limit Entry and Limit orders guarantee price but not execution. A client should weigh his objective and preference between execution and price depending on his trading strategy and the market conditions.

Enlarged Spreads

At times spreads expand beyond the normal spread. Spreads depend on liquidity and in periods of limited liquidity, spreads may expand because of extreme volatility and uncertainty in market movement or thin liquidity. Quite often spreads expand in live market scenario. It is recommended to be aware of liquidity patterns while trading. It also helps managing open orders better. In such scenario clients should be careful while placing new orders. Since spreads may expand because of the change in volatility and liquidity scenario, more often than not spreads expand substantially during news events. The spreads may remain expanded momentarily for few minutes. The scenario of expanded spreads is capable of making huge impact on desired result of the trades. VIBHS strongly encourages clients to employ caution when trading around news events and increased volatility. Widened spreads can adversely affect client's equity.

Pending Orders

Where an order is in the process of execution but not executed means execution has not been confirmed. This may happen in case of high volume and volatility. During periods of heavy trading volume, it is possible that the orders are in queue and there is a delay in getting confirmation of certain orders. It may also happen that the orders have been executed and the delay is due to heavy internet traffic.

The pending order could also be a result of the type of order placed. There is possibility of Market order to be filled at the next available price in the market. In both the scenarios order window will typically indicate executed or processing and it will take few moments for trades to appear in the "open positions" window.

One should also be careful not to place order (click multiple times) repeatedly because order confirmation has not been received because such attempts unconsciously and unnecessarily open unwanted positions.

Trade Rollover

Trade rollover is the process of extending the settlement date of an open position by simultaneously closing the existing position and re-entering (opening) of new equivalent position. A client artificially extends the settlement period. VIBHS does not support delivery or receipt of physical currency, CFDs and other financial instruments. In case of rollover of trade of certain products/financial instruments (Currency) interest is either paid or received on the overnight open positions. VIBHS may also have a system where there are fixed rollover charges or no rollover interest/charges.

It is important to note that rollover charges will be higher than rollover accruals. Spreads during rollover may be wider. Clients are requested to understand the implications of the rollover.

Tick Size

Tick size is defined as the value given to a tick movement for a particular product/financial instruments, also referred as minimum price movement. This cost is the amount that will be gained or lost with each tick movement of the respective product/financial instrument and will be expressed in particular currency. They may vary across various products/financial instruments. On the VIBHS Platforms, the tick size for all the products/financial instruments and equivalent value are defined.

Contract Specification

Inverted Spread

In the event spreads become inverted because of including but not limited to some technical snag, VIBHS advises clients to avoid placing orders on such unreal prices. All trades executed on such prices may be revoked.

Impact of Weekend, Holidays, Opening and Closing Hours

The lack of liquidity and volume during the weekend and holidays at major global financial centres hamper execution and price delivery. Markets may also be extremely volatile over the weekend because of major news announcements, economic and political developments. Therefore market may open with gap in the new trading session. This can severely affect clients' equity, P/L, margin requirements.

Trading hours for various products/ financial instruments differ. Clients placing GTC (Good Till Cancellation) orders during non trading hours may be unable to cancel orders pending for execution. In the event that a Market GTC Order is submitted right at market close, the possibility exists that it may not be executed until the market opens again. VIBHS advises clients to be careful when trading around closing time of the market and factor reasons described into their trading decision.

VIBHS cautions clients holding positions over the weekend. The prices could be significantly different when the market opens (new session) after the close. There are various factors that affect the prices of different products/financial instruments. At times, the opening prices are near where the prices were on the close. However considerable gap may exist between open and close prices because of important news announcements and economic events before the market opens. It depends on how market views and values various products/financial instruments.

The open or close times may be altered as VIBHS relies on prices being offered by third party sources.

Margin Requirement and Liquidation

A margin is cash/collateral that the buyer/seller of a financial instrument has to deposit to cover some or all of the credit risk of their counterparty. It is also called performance bond. Margin acts as a good faith deposit to secure clients' financial obligations and the notional value of his position.

There are two types of margin Initial Margin and Maintenance Margin. VIBHS defines the margin amount for both the margins and they are subject to change depending on various factors, predominantly volatility in the market. Initial margin is expressed either as a fixed amount or percentage of total value of a contract or financial instrument. A client needs to deposit initial margin or have credit balance of equivalent amount in his trading account with VIBHS before he/she can initiate (buy or sale) a position in a particular contract or financial instrument. Maintenance margin (generally less than the initial margin) is the minimum margin (amount), required to continue or maintain the open position.

Margin trading allows clients to hold a position much larger than the actual account value because of leverage. Margin calls are triggered when clients' usable margin (difference between initial and maintenance margin) reaches zero. In the event when client's floating losses reduce account equity/balance to a level that is less than or equal to clients' maintenance margin requirement. Therefore, the result of any margin call is subsequent liquidation unless otherwise specified. VIBHS is not obligated to provide a margin call warning to clients prior to liquidating open positions.

Trading on margin comes with risk. Potential gain coincides with potential loss. If account equity falls to a level that is less than or equal to client's maintenance margin requirement, VIBHS Trading Station/Dealing desk will trigger order to liquidate (close) all open positions or part of the open positions. The liquidation process could be electronic or manual; it is completely on VIBHS's sole discretion to liquidate such open positions that has hit the maintenance margin level in the manner it deems fit and appropriate.

At times during the forced liquidation because a client is on a margin call, there may not be enough liquidity. Therefore it is also possible that the client equity becomes negative because of extreme volatility and gap. Clients would be responsible to make good to such negative balances. VIBHS also recommends that clients use Stop orders to limit downside risk.

It is strongly advised that clients keep their account adequately funded and maintain additional margin in their accounts at all times and do not allow their account balance to fall at or below the maintenance margin.

VIBHS Product Specific Margin Requirements

The margins are indicative and may vary without prior intimation; they may vary in live market scenarios as well.

Margin

Difference between Chart Prices and Work Station Price

There is possibility of difference in price that appears on the VIBHS trading platform and on chart. Chart prices are indicative prices usually very close to the executable prices. There is possibility of both prices, Chart and Executable prices are from different sources and therefore may not be exactly the same. VIBHS recommends clients to establish the distinction between the Chart prices and Executable prices and be aware of the consequences.

Portable Device Trading Platform (Mobile/Tablet)

There are various risks associated to portable device trading platforms (Mobile/Tablet) and technologies similar to internet trading technology as explained above. For example the duplication of order instructions, feed (rate/price) latency and other issues that are result of portable device (Mobile/Tablet) connectivity. Prices displayed on the mobile platform are solely an indication of the executable rates and may not reflect the actual executable price on the platforms.

VIBHS shall not be liable under any circumstances where clients experience a delay in price quotation or an inability to trade caused by slow internet connectivity or any other transmission and technology, hardware problems outside the direct control of VIBHS. Transmission problems include but are not limited to the strength of the mobile signal, latency, or any other issues that may arise between client and his internet service provider or any other service provider.

VIBHS recommends that clients be aware of the functionality of the VIBHS portable device trading platform (Mobile/Tablet) prior to managing a live account via portable device.

VIBHS Dealing Desk

Being customer centric VIBHS provides its clients added means to place trading orders over phone and through online secured login chat service. Customer understands that VIBHS dealing desk in its sole discretion may record telephone calls, or tape or otherwise and produce the same as an evidence in case of legal dispute. Clients acknowledge and agree to accept the recording as an evidence.

Clients are requested to place execution request / order through chat service in rare circumstances, only when you are not able to trade through VIBHS trading platform or in case of system failure, slow down in internet connectivity, failure of your telephone lines.

VIBHS reserves the right to accept or refuse execution of trades on phone/chat. You choose to execute order through phone or online chat service at your own risks. VIBHS will not be responsible for any losses due to technical error or any other error or problem in telephone line or chat service.

These services are added means; clients are usually expected to trade through VIBHS trading platforms. Excessive use may attract a fee, which will be notified separately.

Dealing Desk