This Risk Warning cannot disclose all the significant aspects and risks of the investments referred to. You should not invest in CFDs or undertake Spread Bets unless you are sure you understand their nature and the associated risks.
Although CFDs & Spread Bets can be utilised for the management of investment risk, they are unsuitable for many investors.

You should also consider carefully whether or not this type of investment is suitable for you in light of your circumstances and financial position, and if in any doubt seek professional advice.

Please consult your contact at Hichens, Harrison & Co. Plc if you have any questions or if you are in any doubt.

A CFD is a contract between the investor and the CFD provider to exchange the difference between the opening and closing value of the trade. When applied to equities, such a contract is an equity derivative that allows investors to speculate on share price movements (going short or long) without the need for ownership of the underlying shares.

A spread bet is an agreement between a client and a provider to exchange the difference between the opening and closing value of the bet at a future date - this date may or may not be specified depending upon what you are trading. You are speculating on the direction of the future price movements in an underlying instrument; you indicate an amount you want to bet on each point movement. Your profit or loss is simply the difference between the opening price and closing price of your bet, multiplied by your stake.

CFDs & Spread Bets are a margined product. You only deposit a fraction of the overall value of the trade, allowing you to make a much larger potential investment than if you were buying the underlying shares. In addition to the initial margin required to establish a position, if your position moves against you, you may need to make further deposits. This is because you must meet the full value of running losses as well as maintaining the initial margin. By using margin you are effectively borrowing money to trade, and as a result you are charged financing for your positions.

Trading Spread Bets carries a high level of risk to your capital, and you should ensure that you fully understand the risks involved and only speculate with money you can afford to lose.

For example, you should familiarise yourself with the specific risks involved with trading on margin.

You may sustain a total loss of the margin you deposit to establish or maintain a position. If the market moves against you, you may be called upon to pay substantial additional margin at short notice to maintain the position. If you fail to do so within the time required, your position may be liquidated at a loss and you will be responsible for the resulting deficit. We have the right under our terms of Business to close out your open positions at any time should there be a deficit of margin on your account.

When depositing funds in respect of margin, you may wish to leave some "headroom" by depositing an amount which exceeds the minimum required in respect of your open positions at that time, in case the market moves against you and you are unable to deposit further funds as required.

Profit or loss will vary with fluctuations in the price of the underlying investment, but the high degree of gearing which results from the margining system means that a relatively small movement in the underlying investment can have a disproportionately dramatic effect on your trade. If the movement is in your favour, you may achieve a good profit, but an adverse movement can not only quickly result in the loss of your entire deposit, but may also expose you to substantial losses over and above this.

Furthermore, under certain trading conditions it may be difficult or impossible to liquidate a position. This may occur, for example, at times of rapid price movement if the price rises or falls in one trading session to such an extent that under the rules of the relevant exchange trading is suspended or restricted.

Please seek independent advice if necessary.