Mirror Trades - Risk Disclosure
IMPORTANT RISK WARNING
Trading in financial markets, including copy trading, involves significant risks and is not suitable for all investors. Please read this Risk Disclosure carefully before participating in any trading activities through Mirror Trades services.
1. Nature of Risks
Capital Loss:
Trading in financial instruments can result in significant losses, including the complete loss of invested capital. According to regulatory statistics, 67-89% of retail investor accounts lose money when trading CFDs. You should never invest money you cannot afford to lose.
Leverage:
Leveraged products like CFDs can amplify both profits and losses. Even small market movements can have a significant impact on your account. A leverage of 1:500 means that a 0.2% adverse movement can result in a 100% loss of your capital.
2. Specific Copy Trading Risks
Dependence on Third Parties:
In copy trading, investment decisions are made by the signal providers/traders you choose to copy. You have no direct control over trades and rely on others' strategy, experience, and judgment.
Past Performance:
Previous performance of traders does not guarantee future results. A trader who was successful in the past may incur significant losses in the future.
Entry Timing:
You may enter copying a trader at an unfavorable time, even if the trader is generally successful.
Slippage and Delays:
There may be delays in copying trades, resulting in different execution prices from those of the original trader.
3. Market Risks
Volatility:
Financial markets are extremely volatile. Prices can move quickly and unpredictably due to geopolitical events, economic announcements, or other factors.
Liquidity Risk:
During periods of high volatility or in exotic currency pairs, there may be limited liquidity, making it difficult to execute trades at desired prices.
Gaps:
Markets can open with significant gaps compared to the previous close, especially after weekends or major events.
4. Technical and Operational Risks
System Outages:
Technical problems with trading platforms can prevent trade execution or cause delays.
Broker Risk:
Despite regulatory protections, there is a risk of broker insolvency or other operational problems.
Cybersecurity:
Risks from cyberattacks or security breaches that may affect accounts.
5. Regulatory Risks
Regulatory Changes:
Future changes in regulatory legislation may affect the availability or terms of trading services.
Tax Implications:
Trading profits may be subject to taxation. It is your responsibility to understand your tax obligations.
6. Psychological Factors
Emotional Trading:
Emotional decisions due to fear or greed can lead to poor investment choices.
Overconfidence:
Initial successes may lead to excessive risk-taking.
7. Risk Management - Recommendations
- Education: Fully understand the products you are investing in before starting.
- Diversification: Don't copy just one trader. Distribute your capital among multiple traders with different strategies.
- Stop Loss: Set loss limits for each trader you copy.
- Risk Capital: Use only capital you can afford to lose without affecting your financial situation.
- Monitoring: Regularly monitor performance and adjust your strategy accordingly.
8. No Guarantee Statement
Mirror Trades does not guarantee profits or protection from losses. All investments are made at your own responsibility and risk. Mirror Trades, partner brokers, and signal providers bear no responsibility for any losses.
9. Professional Advice
If you do not fully understand the risks or have doubts, consult an independent financial advisor before starting trading.
By signing/accepting this document, you declare that you fully understand the risks mentioned above and accept that trading is done at your own responsibility.