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Account
Your account with us for spread betting and/or CFD trading.
Agent
A representative you may appoint to operate your Account.
Application Form
HH’s application form. There are different Application
forms for individual and corporate clients.
Associated Company
A company that is an associate of another within the
definition in s52 Companies Act 1989.
Backwardation
When our offer (buy) price for an instrument is lower
than our bid (sell) price. This is Market Disruption
Event.
Base Currency
The currency agreed by you when we open your Account
(or if no currency is agreed we will use GBP Sterling).
Base Rate (UK)
The official rate at which the Bank of England (BoE)
will lend to retail banks.
Bid price
The lower price of a quoted spread. The level at which
you would sell and we would buy a market.
Business Day
Monday to Friday (inclusive) excluding English public
holidays.
Buy
To place an opening trade at the offer price of a spread
in anticipation of the underlying market rising, or
“going long”. You can also buy at the Offer
Price to close an existing short position.
Cash Balance
The balance of your Account with us (whether a credit
or debit balance taking into account credits and debits
to that Account including any profit or loss arising
from closed Margined Trades *but not taking into account
any Open Positions).
Cash Market
The market in the underlying financial instrument (shares,
indices, commodities, etc.) on which a derivative contract
is based.
CFD Terms
Our standard terms and conditions for CFD trading, as
from time to time amended and/or replaced.
Closing/Covering a position
To sell a long position, or buy back a short position.
“Client”, “your” and “you”
A person or body corporate whom HH has opened an Account
for and allocated an account number.
Client Services
Our customer services department.
Collateral
The value of any collateral we have accepted from you
and which we hold as security for your obligations to
us in respect of your Account.
Commissions
Fees that are charged a client for buying/selling of
a financial product which can be charged as a percentage
or as a flat rate. We do not charge commissions on main
index constituent single stocks or any spread based
products.
Corporate Action
Any rights, scrip, bonus issues or offer of shares/equities
of whatsoever nature or the issue of any warrants, options
or the like giving the rights to subscribe for shares/equity;
Acquisition or cancellation of own shares/equities;
Reduction subdivision consolidation of own shares/equities;
Reduction subdivision consolidation or reclassification
of share/equity capital; Any distribution of cash or
shares; A take-over or merger offer; Any amalgamation
or reconstruction affecting the shares/equities concerned;
Any other event which has a diluting or concentrating
effect on the market value of the Underlying share/equity.
Day Count Fraction
The number of Days a CFD or spread bet position is opened
for expressed as 365 day fraction used to construct
Our Finance Rate (see Appendix A – price construction
of our trade and Order Execution Policy).
Days to Maturity
The number of Days until expiry of an underlying instrument
used to construct our CFD and Spread bed prices.
Dividend
A cash bonus or other distribution made by a company
to its shareholders and applicable to every share that
they hold in relation to that company. Some spread bets
& CFDs in relation to individual equities or index
products do not qualify for dividends. Long and Short
dividend rates may vary from country to country.
Eligible Counterparty
A person who has been classified by us as an eligible
counterparty under the FSA Rules.
Euronext
Pan-European exchange for France, Belgium, Holland and
Portugal. Euronext merged with NYSE to form NYSE Euronext.
Event Outside our Control
Any cause preventing us from performing any or all of
our obligations under the Terms which arise from or
is attributable to acts, events, omissions or accidents
beyond our control.
Execution venue
A place where financial instruments can be bought or
sold, for example an exchange such as the London Stock
Exchange (LSE). We are the sole execution venue for
trades and orders placed with us. See our Trade and
Order Execution Policy.
Fair value
The theoretical price at which a futures contract would
be expected to trade above or below the cash market
(see appendix A – Price construction of our Trade
and Order Execution Policy)
Fill
Used to describe when a market order is completed or
executed, commonly expressed as having been “filled”.
FOS
The Financial Ombudsman Service
FSA
The Financial Services Authority (a government appointed
body responsible for regulating spread betting, FX and
CFDs within the U.K.) and any successor to that authority,
and "FSA Rules" shall be construed accordingly.
FSMA 2000
The Financial Services and Markets Act 2000.
Gapping
Our price has moved directly from one price to another
without stopping at any intervening price. Sometimes
call Slippage when referenced to Stop Losses.
Gearing
Also known as leverage. To use borrowed funds (trading
“on margin”) to purchase or sell a financial
instrument, which increases your exposure to the market
with a lower capital requirement.
General Terms
Our general terms and conditions of service, which form
part of the Terms which may be from time to time be
amended and/or replaced. A copy will be made available
to you when you open an account with us, and copies
are also available through our website.
GFD (Good for the day)
Applicable to all orders, it signifies that the order
is open but will be cancelled until it is either filled
or cancelled at the end of the business day.
GTC (Good ‘til
cancelled)
Applicable to all orders, it signifies that the order
will open and be carried forward indefinitely until
it is either filled or cancelled by the client.
Hedge/hedging
The act of employing another related derivative in order
to protect an existing open position.
Hichens Harrison &
Co. plc
"HH" or “we”, “us”
and “our”.
Illiquid
A market that has very little volume. Can be moved disproportionately
by a small amount of trade volume and can result in
wide bid/offer spreads.
Initial margin
The size of the cash deposit that is required to trade
a specified position. By multiplying your proposed stake
by the initial margin multiplier, you can calculate
the amount of initial margin (or waived initial margin)
that is required before you can place the trade referred
to in clause 3 of our Margining Terms.
Insolvency Event
If a resolution is passed or an order is made for your
winding up, dissolution or administration, if any bankruptcy
order is made against you, the appointment of a receiver,
administrator, manager, administrative receiver or similar
over, or if any incumbent takes possession of or sells,
all or any part of your position, the making of an arrangement
or composition with your creditors generally or the
making of an application to court for protection from
your creditors generally (including under chapter 11
of the US bankruptcy Code).
Instruction
A request from you to us either to execute a trade with
immediate effect or to place an order.
Interim dividends
When a company distributes profits to shareholders at
stages during the financial year.
Leverage
The ability to establish a large exposure from relatively
small outlay. Also known as “gearing”. There
are inherent risks attached to such a practice.
LIBOR
London Inter Bank Offer Rate.
Limit Order
An instruction to either buy or sell at a level that
is more favourable than the current price of the specified
financial instrument. The possibility exists that the
order will never be filled.
Limit up/limit down
When an exchange enforces a temporary price ceiling
or floor, suspends, restricts or closes the stock index
for a set period of time in order to maintain a fair
and orderly market and reduce the risk of large and
sudden price movement.
Liquid Market
A market with sufficient volume so as to avoid wide
bid/offer spreads and volatile price movements.
Long position/Go Long
Hold or opening a position at our offer price in anticipation
of the underlying market rising. See “buy”.
Manifest Error
A request for payment of Margin as referred to in our
Margining Terms.
Margin
Refers to Initial Margin or Variation Margin.
Margin Call
When variation margin is immediately due and payable
by you in order to return your account position to a
positive figure. Failure to do so will result in your
position being closed in accordance with our Terms and
Conditions.
Margin factor
A factorial multiplier applied to our normal margin
rate applied to your account .
Margined Trade
The ability to establish a large exposure from a relatively
small outlay.
Margining Terms
The terms which relate to our Margin Policy
Margin Requirement
The amount required to open a spread bed and/or CFD
trade and the amount required to maintain an Open Position
spread bet .
Marked to Market
The value of each open position on your account calculated
at our price.
Market Disruption Event
The occurrence of any other event which causes a material
market disruption in respect of the Underlying on which
Our Prices are based. We reserve the right to take out
any trades that occur as a result of an event outside
our control.
Market Information Sheet
The Market Information Sheet is prepared by us and is
amended from time to time. Please note that we have
different Market Information Sheets for spread betting
& CFD trading. The set of Market Information Sheets
that will apply to your Margined Trading will be the
set that relates to the type of Margined trading you
carry out. The Market Information Sheets are available
via the Website. Copies can also be provided by Client
Services.
Market capitalisation
Calculated by multiplying the number of shares issued
in respect of the company by the current share price.
Market maker
Exchange registered companies that quote a two-way spread
in relation to securities.
Market order
An order to buy or sell at the prevailing bid or offer
price for a particular instrument.
Markets
The markets we from time to time make available for
Margined Trading.
Net change
The difference between the closing price of an instrument
on the day’s trading and the previous day’s
closing price. Net change can be positive or negative,
and is quoted in terms of currency.
Normal Market Size
As defined by the London Stock Exchange, the percentage
of an individual company’s stock for which a market
maker is obliged to provide a quote. Market makers are
not obliged to provide a quote for any transaction of
a size in excess of the NMS.
OCO (Order cancels order
or one cancels the other)
This is a Limit Order and a Stop Order combined such
that whichever Order is executed first the remaining
Order is cancelled.
Offer Price
The “ask” or the higher price of a quoted
spread. The level at which a client would buy or “go
long” of a market.
Open Position
A Margined Trade that has been placed on your Account
to the extent it has not been closed (and excluding
any Margined Trade you place to the extent that it closes
an existing Open Position)
Open Position P&L
Unrealised P/L on your account where you have Open Positions
or wish to create an Open Position.
Order Aware Minimum
%
The percentage specified by us in our absolute discretion
as the order aware minimum margin %, as from time to
time varied or replaced in accordance with our Terms.
This percentage can be found on the IDS and/or the Market
Information Sheets and varies according to the relevant
Market.
Our Bid Price
The lower of two prices set by us (for the same market)
and the price at which we are prepared to purchase an
instrument subject to liquidity.
Our Dividend Rate
The Dividend rate at which we choose at our discretion
to construct CFD and Spread bet prices.
Our Mid Price
The Mid rate at which we choose at our discretion to
construct CFD and spread bet prices.
Our Offer Price
The higher of two prices set by us (for the same market)
and the price at which we are prepared to sell an instrument
subject to liquidity.
Our Price
Our offer price and/or bid price, as the context requires.
Our size
The size for each market for which our price is a firm
price – i.e. you know you can execute at the price
you see. Our size may differ for each of the bid and
the offer.
Our Finance Rate
The Finance rate at which we choose at our discretion
unless otherwise agreed to adjust the financing costs
of a CFD or spread bet which will change from time to
time.
Our spread Rate
The Spread rate at which we choose at our discretion
to construct CFD and Spread bet prices.
Our Premium Factor
The factor at which we choose at out discretion to construct
CFD and Spread bet prices.
Our Discount Factor
The factor at which we choose at our discretion to construct
CFD and Spread bet prices.
Professional Client
A person who has been classified by us as a Professional
Client under the rules of the FSA.
Regulatory System
All UK and international legislations, rules and regulations
applicable to your dealings in Margined Trades including
FSMA 2000, market abuse legislation in force, the rules
and regulations of the FSA, the Takeover Panel and securities
exchanges.
Retail Client
A person who has been classified by us as a retail client
under the rules of the FSA
Risk Warning Notice
The notice provided to you setting out a non-exhaustive
statement of the risks involved in margined trading.
Rollover
Transferring a CFD or spread bet trade that is near
expiry to the next contract period.
Sell
To place an opening trade at our Bid price in anticipation
of the Underlying market falling, commonly referred
to as a “down trade”, “taking a short
position”, or “going short”. You can
also sell at Our Bid price to close an existing long
position.
Short/go short
Holdings or opening a “sell” position at
Our Bid price in anticipation of the underlying market
falling. See “sell”.
Slippage
The price difference between where an order is placed,
and where it is actually filled. Can occur in extremely
volatile markets.
Spot
The actual price difference of a financial instrument
for immediate settlement or delivery.
Stamp Duty
U.K. government tax of 0.5 percent paid by the buyer
on share transactions. There is no Stamp Duty on CFDs,
spread bets or forex transactions under current tax
legislation.
Stop loss
A market order that can be employed in an attempt to
limit potential losses, but is not guaranteed either
during or outside of market hours.
Stop order
An instruction to either buy or sell at a level that
is less favourable than the current price of the financial
instrument in question.
Short Position or “Sell”
An open Position placed at our Bid price.
Spread Betting Terms
Our Standard terms and conditions for spread betting
as from time to time amended and/or replaced.
Specified order price
The price we have agreed with you in relation to the
execution of an order.
Terms
The contract between us which governs the operation
of your Account.
Third Parties Act
The Contracts (Rights of Third Parties) Act 1999.
Total Margin Requirement
The margin Requirement of all spread bet and CFD trade
open positions on your account that remains (if any)
after deducting the Waived Margin application to your
account (if any).
Trade and Order Execution
Policy
The trade and order execution policy of HH as from time
to time amended and/or replaced. A copy of this is available
on the Website. A copy can also be obtained by contacting
Support services.
Trading Resource
The total of the following in respect of all your Accounts:-
- Cash Balance;
- Plus Credit Allocation (if any);
- Plus Collateral (if any);
- Less or plus Open Position P&L
(as appropriate);
- Less or plus Open Position P&L
(as appropriate);
- Less
Total Margin Requirement
“Trading Resource” – is the total
of the above for all your accounts.
Trigger price
The price that triggers an order you have left with
us.
Underlying
The underlying financial instrument (shares, indices,
commodities, etc.) on which a CFD, spread bet or other
derivative contract is based.
Underlying Bid, Mid,
Offer, Spread
Our prices are derived from financial instruments that
are traded in the global financial markets.
Valuation price
The price used for the revaluation of open positions.
Variation Margin
The amount of money that is immediately due from you
in the event that when holding open positions your overall
account position is a negative figure.
Waived Margin
Provision or continuing waiver of the margin provision
or margin provisions so waived by us at our sole discretion.
(the) Website
Any of the Hichens Harrison & Co group websites,
such as; www.hichens.com & www.hh1803.com
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