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"Due To The Current Market Environment In Europe", Saxo Bank Quadruples CHF Margins From 1% to 4%

Tyler Durden's picture





 

Yesterday, Reuters royally spooked the market when it announced that Europe is in all seriousness considering full blown capital controls, including border halts and ATM closures. Subsequently, various European talking heads aggressively tried to talk down this latest development. However, overnight Saxo Bank appears to have focused on the former and not the latter, and sent out an email with the following key text: "Due to the current market environment in Europe, Saxo Bank is adjusting the margin requirement for Swiss Franc (CHF)." Specifically, the margin is going from 1% to 2% on June 14, to 4% on June 21. How soon until margins become so high that they effectively act as an FX trading prohibition- i.e., an implicit "capital control", and how long until all other exchanges get the memo next?

Here is the link Saxo Bank provided to explain this move: CHF: Systemic risk and the EU debt crisis

h/t Manoj

 


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Tue, 06/12/2012 - 10:03 | Link to Comment slaughterer
slaughterer's picture

At this point, the whole world is waiting for its next short entry into Euroland.  The banksters are raising the price of admission to the bear funhouse day by day.

Tue, 06/12/2012 - 10:10 | Link to Comment Dan The Man
Dan The Man's picture

when does everyone just leave?

Tue, 06/12/2012 - 10:15 | Link to Comment Dr. Engali
Dr. Engali's picture

When the panzers start rolling in.

Tue, 06/12/2012 - 10:11 | Link to Comment GMadScientist
GMadScientist's picture

And still...a line around the block. ;)

Tue, 06/12/2012 - 10:03 | Link to Comment GeneMarchbanks
GeneMarchbanks's picture

1970s Redux.

Tue, 06/12/2012 - 10:05 | Link to Comment CPL
CPL's picture

It certainly has a familiar beat doesn't it?

Tue, 06/12/2012 - 10:04 | Link to Comment Unprepared
Unprepared's picture

Come on Tyler, it's just a coincidence /sarc

Tue, 06/12/2012 - 10:06 | Link to Comment Dr. Engali
Dr. Engali's picture

Due to current market conditions I am adding to my precious metals positions.

Tue, 06/12/2012 - 10:07 | Link to Comment yabyum
yabyum's picture

Might be time to get a some PM's while you still can. A little metal is better than a whole shit load of paper anyway.

Tue, 06/12/2012 - 10:11 | Link to Comment Dan The Man
Dan The Man's picture

not to be picky, but that time already passed.

Tue, 06/12/2012 - 10:11 | Link to Comment AUD
AUD's picture

Expecting big losses in CHF/Euro?

It's not linear but the gold price has shown a positive correlation with an appreciating CHF over the last few decades.

Tue, 06/12/2012 - 10:09 | Link to Comment EL INDIO
EL INDIO's picture

WTF

 

1-4% margin only !

 

Does that mean they allowed 100X leverage and now they reduced it to 25X ? !

Tue, 06/12/2012 - 10:09 | Link to Comment GMadScientist
GMadScientist's picture

We need more sandbags! If we don't prepare for the Gresham flood, we'll be soaked!

 

Tue, 06/12/2012 - 10:10 | Link to Comment Satan
Satan's picture

Lol...Saxo is the counter party to their clients( muppets) spot fx trades. Looks like they gonna make a nice little windfall as positions get screwed...

Tue, 06/12/2012 - 10:14 | Link to Comment Dan The Man
Dan The Man's picture

is that Goldmano Saxo?

Tue, 06/12/2012 - 10:14 | Link to Comment PaperBear
PaperBear's picture

Now fiat FX gets the same treatment that gold and silver got during May 2011.

Tue, 06/12/2012 - 10:20 | Link to Comment lolmao500
lolmao500's picture

Stocks are high on kool aid... so are treasuries (in the UK, US and France)

Tue, 06/12/2012 - 10:31 | Link to Comment sockratte
sockratte's picture

i also have some providers, who increased margin almost tenfold i think, mainly for european banks. ,-)

Tue, 06/12/2012 - 10:34 | Link to Comment eddiebe
eddiebe's picture

Could it really be? Fractional reserve is starting to feel the strain of mistrust. 400% worth. Soon it will take 1000's of % to get suckers to bite.

Tue, 06/12/2012 - 10:38 | Link to Comment Pretorian
Pretorian's picture

Does SAXO bank still practicing short naked with adequate capita?

 

Tue, 06/12/2012 - 10:50 | Link to Comment Broccoli
Broccoli's picture

Who else is shocked that there was ever a 1-2% margin? 100x or 50x leverage! 25x leverage is still insane. At 100x leverage I would think trading fees alone would eventually wipe out your balance.

Then again I graduated from Rice not Harvard so they obviously know better than me and aren't just psychopath gamblers, obviously.

Tue, 06/12/2012 - 10:51 | Link to Comment _underscore
_underscore's picture

Saxo Bank is going to get stuffed.

Tue, 06/12/2012 - 10:54 | Link to Comment tomAsss
tomAsss's picture

tighten your seatbelts

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