The minimum deposit for FxPro SuperTrader investors is $2000 with a credit multiplier of 4. In this way investors can meet the minimum capitalisation requirement of $10,000 without having to deposit the full amount. This is in order to protect against the risks associated with undercapitalised accounts. In order to function optimally, a SuperTrader portfolio must be adequately diversified by being invested in a number of strategies, with sufficient capital allocated to each one and enough free equity remaining for further allocation. Deposits made in EUR and GBP will be converted to USD and should total to at least $10,000 after the use of a credit multiplier . Subsequent deposits have no minimum required amount.
In order to make the platform more accessible we offer a credit line that allows you to multiply your investment by up to 4 times and add it to your initial deposit. So in order to meet the $10,000 minimum deposit requirement, an investor can deposit as little as $2000 and obtain the remaining $8000 using our credit line.
Existing SuperTrader clients who wish to take advantage of our credit line are not required to meet the deposit requirement and are free to take advantage of the credit line or to continue copying strategies without it. Find out more by downloading our Credit Line Guide
Minimum account size
The minimum account size for FxPro SuperTrader is $10,000, however, investors should be aware that the more capital you have available, the more diverse your FX portfolio will be.
One of the first laws of trading is to not trade with an underfunded account. Underfunded accounts are very vulnerable to volatility.
An underfunded SuperTrader account causes the strategies in your portfolio to not perform in-line with leaders’ positions. There are three main reasons for this:
An underfunded account does not allow funds to be allocated to a range of strategies. This causes the investor’s portfolio to be inadequately diversified.
An underfunded account forces investments to be overleveraged in relation to the leader being followed. Which translates to more risk for the investor than the leader.
These two issues result in the investor’s portfolio being very vulnerable to drawdowns.
Credit line risks, margin and maintenance calls
While our credit line makes additional funds available to investors and offers the potential for increased returns, it also comes with its own risks, which you should be fully aware of. All losses incurred while investing in SuperTrader strategies are borne by your risk capital alone and not the funds FxPro has credited to you. Using a credit line allows you to continue allocating funds to strategies even as your own equity diminishes. When using a credit line you may receive a margin call if you have insufficient equity to absorb the losses resulting from a drawdown.
You will receive a margin call notification when your equity (excluding Credit amount) drops to 6% of the credit amount. When your equity (excluding Credit amount) drops to 3% of the credit amount, you will be stopped out. Any strategies you are following will be stopped and all trades will be closed automatically as to protect your account from a negative balance.
As a SuperTrader investor you have the added option of receiving a maintenance call via email or SMS. In this way you can avoid the liquidation of your open positions by depositing more funds into your account, if you choose to do so.
The following is a perfect example of how an underfunded portfolio takes on proportionally more risk than that of the leader being copied:
An investor with 4000USD in their SuperTrader account allocates the full amount to a single strategy. The leader of that strategy, whose own capital totals 40,000USD, opens a buy position of 0.04 lots (0.04 lots = 4000USD). The investor’s available capital is 1/10th that of the leader’s, so a proportionate position is taken on the investor’s behalf. This would have been 0.004 lots (400USD), but seeing as the smallest available lot size is 0.01 (1000USD), the investor’s position must be rounded-up to this amount. This makes the size of the investor’s position 1/4th of his or her total risk capital, while the leader’s is 1/10th. Furthermore, rounding the investor’s position up results in the investor’s position being overleveraged by 2.5 times (0.01/0.004 = 2.5).
You wish to invest 90,000USD
You invest 30,000USD and FxPro’s credit line will make the remaining 60,000USD available to you.
- In the case where your portfolio loses 10% and you stop the investment: The loss on the full 90,000USD is 9,000USD 60,000USD goes back to FxPro The 9,000USD loss will be deducted from your risk capital (30,000 -9,000 = 21,000).
- In the case where your portfolio earns 10% profit and you stop the investment: 90,000USD + 9,000USD profit 60,000USD goes back to FxPro The 9,000USD profit will be added to your risk capital, 30,000 +9,000 = 39,000
How we are able to offer a credit line
- FxPro complies with MiFID (EU Directive 2004/39/EC). As a result we keep our clients’ funds in segregated accounts and can only use this money to settle profit and loss between our clients and the banks with which we trade as counterparty.
- In order to provide liquidity and margin to our clients FxPro uses its own funds. We cannot use our clients’ funds for liquidity or margin requirements.
- We do not require any funds other than the investor’s risk capital, which will be used to cover any loses that may result during trading.
- Offering a credit line does not have any additional cost for us, because we keep enough of our own funds with our Prime Broker in order to supply liquidity to SuperTrader. As a result we do not charge you for this facility either.