Key Information Document
This document provides you with key information about this investment product. It is not marketing material. The information is required by law to help you understand the nature, costs, risks and rewards of this product and to help you compare it with other products.
Manufacturer of the Product
Capital Com SV Investments Ltd, a company authorised and regulated by the Cyprus Securities and Exchange Commission (License No. 319/17) with registered office at 6th floor, Lophitis Business Centre II, 237, 28th October Street, Limassol, PC3035.
This Key Information Document was published on 08 February 2018
WHAT IS THIS PRODUCT?
Capital Com SV Investments Ltd offers contracts for differences (“CFDs”) across a range of underlying asset classes, including, but not limited to, equity, commodities, FOREX, indices and cryptocurrencies. A CFD is a type of transaction the purpose of which is to secure a profit or avoid a loss by reference to fluctuations in the value or price of a relevant underlying asset.
In a CFD contract, one party agrees to pay the other the difference between the value of a security at the start of the contract and its value at the end of the contract.
The mechanism behind CFD trading is quite straightforward. If you believe the price of a chosen financial instrument will go up, you open a CFD position and buy the amount of CFDs you see fit. In other words, you ‘go long’. If the market moves in your favour, you reap the profit. Similarly, if you expect the price of a chosen financial instrument to drop, you take a position of a market going down, or simply ‘go short’. Yet, if you miscalculate the direction of the market movement and the price changes contrary to your expectations, you may suffer losses.
CFDs are complex products, generally used for speculative purpose. CFDs are not suitable for “buy and hold” trading, therefore if the Client does not have enough time to monitor such investments on a regular basis, he or she should not trade in CFDs.
The client has no rights or obligations in respect of the underlying instruments or assets relating to your CFD. Specifically, in case of an equity CFD you will not receive any voting rights. In addition, equity CFDs have no expiry date, however, should Corporate Event be announced based on a takeover or a reorganisation, the date of that Corporate Event may be used as the expiry date.
Our services involve trading CFDs and carry a high level of risk and can result in you losing all of your initial deposit. Our CFD trading is not suitable for everyone.
Special Statement for Residents of Spain.
The Company trades CFDs. CFD is a product that is complex and difficult to understand. The National Securities Market Commission of Spain (Comisión Nacional del Mercado de Valores) has determined that, due to the complexity of the CFDs and the risks involved, the purchase of CFDs by retail investors is not appropriate/suitable. A CFD is also a leveraged product and the losses incurred may be greater than the amount initially invested.
WHAT ARE THE RISKS AND WHAT COULD I GET IN RETURN?
The summary risk indicator is a guide to the level of risk of this product compared to other products. It shows how likely it is that the product will lose money because of movements in the markets or because we are unable to fulfil our obligations. We have classified this product as 7 out of 7, which is the highest risk class. This rates the potential losses from future performance at a very high level. Be aware of currency risk. You may receive payments in a different currency, so the final return you will get depends on the exchange rate between the two currencies. This risk is not considered in the indicator shown above. In some circumstances you may be required to make further payments to pay for losses. Trading risks are magnified by leverage – the total loss you may incur may significantly exceed the amount invested. Values may fluctuate significantly in times of high volatility or market/economic uncertainty; such swings are even more significant if your positions are leveraged and may also adversely affect your position. As a result, Margin calls may be made quickly or frequently, and in the event of default, your positions may be closed out and any shortfall will be borne by you. Trade only after you have acknowledged and accepted the risks. You should carefully consider whether trading in leveraged products is appropriate for you.
What kind of investors protection does Capital Com SV Investments Limited offer?
Capital Com SV Investments Limited is a member of the Investor Compensation Fund for Customers of Cyprus Investment Firms (CIFs) and other Investment Firms (IFs) which are not credit institutions. The Fund was established under the Investment Firms Law of 2002 (as amended and replaced by Law 144(I)/2007 and Directive DI144-2007-15 of the Cyprus Securities and Exchange Commission for the Continuance of Operation and the Operation of the CIF Investor Compensation Fund.
The Fund constitutes a private law legal entity and its administration is exercised by an Administrative Committee, consisting of five members, who hold office for a three-year term.
You can find more detailed information here.
WHAT ARE THE COSTS?
Before you begin to trade CFDs you should familiarise yourself with all costs for which you will be liable. These charges will reduce any net profit or increase your losses. For more information please visit our website.
Capital Com SV Investments Limited applies SPREAD (the difference between the lower and the higher price of a given CFD). The spread is dynamic and may factor in the liquidity in the external markets and the competitor pricing. Our spreads are set in our absolute discretion, since we are acting as market maker, and any changes are effective immediately. CAPITAL.COM reserves the right to mark-up the spreads.
No other charges or commissions but spread are paid by the clients for the trade itself.
2) Overnight fees
If you hold a position open overnight, an overnight premium is subtracted or credited to your account. The size of overnight premium is specified for each instrument on our trading platform and the website.
2.1. The rates for shares and indices are calculated the same way. Here’s how:
Trade Size x Closing Price x (3% +/- LIBOR) / 100% / 365 (or 360)
Trade Size is, for example, the number of shares.
Closing Price is the instrument’s value at 5 p.m. (EDT).
LIBOR is a one-month interbank interest rate. Basically, this is an interest rate that major banks charge to lend funds to one another. Brokers can use equivalent interest rates to adjust fees.
3% is the broker’s interest. This is what Capital.com charges to cover the risks of holding a client’s position overnight.
Whether we divide by 365 or 360 depends on the currency: the formula for GBP shares includes 365; 360 is used for other currencies.
2.2. Overnight fees for Forex CFDs are calculated as:
Trade Size x (0.7% +/- tom-next rate%)
Tom-next is short for 'tomorrow to next day'. This is the difference between interest rates of the two currencies paired with one another.
Generally speaking, if you hold a long position, the fee will be credited to your account given that the interest rate of the first currency is higher than that of the second one. Holder of a short position will be debited the fee rate under the same conditions.
2.3. Overnight fees for commodities CFDs are based on the holding costs of the underlying futures contracts. The costs are used as our overnight fee rates and can also be either debited from or credited to your account.
3) Inactivity fees
Inactive accounts are the subject to a monthly charge of 10 USD (or the equivalent of the same in one of the Base Currencies), relating to the maintenance/administration of such inactive accounts.
Find more on Inactive Account in our Terms and Conditions.
4) Additional costs
You should be aware of the possibility that other taxes or costs may exist that are not paid through or imposed by us. It is your sole responsibility to bear these additional costs.
HOW LONG SHOULD I HOLD IT AND CAN I TAKE MONEY OUT EARLY?
Capital Com SV Investments Limited does not provide you with any investment advice, our trading service is execution only and we execute trades based on your instructions.
HOW CAN I COMPLAIN?
In the event you are dissatisfied about a financial product or service provided to you by Capital Com SV Investments Limited, contact us to submit your complaint, providing the following information to assist us in dealing with your complaint. Details: https://capital.com/complaints-procedure