Negative balance protection is designed to limit some customer liabilities when leveraged positions lose more than the funds in a relevant CFD account. It is not the same as protection against losing the deposit, and it does not apply identically in every market.
What it aims to limit
In the EU CFD product-intervention framework, negative balance protection is one of the required retail safeguards for covered contracts. ESMA explains its relationship to per-account liabilities. This can constrain loss beyond the relevant account funds, subject to the applicable rules and circumstances.
What it does not promise
The protection does not mean the trader cannot lose the full amount deposited. It is not insurance against a broker’s insolvency, a guarantee that an automated system will stop at the chosen level, or proof that an offshore entity provides identical terms.
Why the country matters
Professional client classification, non-EU entities and different product types may involve different arrangements. Check the account agreement of the company actually accepting the client, relevant regulator guidance and whether the specific product falls under a negative-balance rule.
- Is the client classified as retail or professional?
- Which legal entity signs the agreement?
- Does the clause cover CFDs in this account?
- Is protection per account or subject to other contractual conditions?
How we display this on the site
Our comparisons will not award a generic “protected” badge based solely on a group’s corporate logo. Where verified, we will name the jurisdiction and entity. Otherwise the field is marked “not yet confirmed.”
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