ASIC’s product intervention

Find out how the changes may affect you and the products you trade.

What you need to know

ASIC made a recent announcement which will change the way we can offer our products and services to retail clients of our ASIC licensed entity. We’ve put together a summary of the main reforms below to help you understand these changes and how they may affect you.

These changes are due to come into effect from 29 March 2021.

Changes to leverage caps

A key focus of the change is leverage restrictions, which will affect the amount of margin retail clients are required to deposit to trade CFDs or FX. Here’s how the proposed changes look:

  • 20:1 leverage on currency pairs and gold = 5% margin
  • 15:1 leverage on major indices = 6.67% margin
  • 10:1 leverage on commodities (excluding gold) = 10% margin
  • 2:1 leverage on cryptocurrency assets = 50% margin
  • 5:1 leverage on shares or other underlying assets = 20% margin

ASIC's media release:

Read the full Product intervention: OTC binary options and CFDs release here.

Will I be affected?

The ASIC proposals impact retail clients only, not wholesale clients. You can register as a Pepperstone Pro, which means wholesale classification with additional benefits. To register, you’ll need to meet the following eligibility criteria as certified by an accountant:

  • You have net assets (including property, savings, super and any other assets you own) of at least AUD $2.5 million OR
  • You have gross income for each of the last two financial years of at least AUD $250,000.

It's important to note that you will lose some retail-only protections if you become Pepperstone Pro, so you do need to consider this in your decision.

Find out more about wholesale status or register as a Pepperstone Pro now.

Am I eligible to become a Pepperstone Pro?

There are two main ways you may be eligible for Pepperstone Pro status.

Option 1: Wealth test*An eligible client is someone who:
- has net assets of at least AUD$2.5million; or
- has a gross income for each of the last 2 financial years of AUD$250,000.

If you’re eligible, it’s easy:
1. Log into your secure client area.
2. Select Register as a wholesale client in the top right-hand side of the screen. You’ll be asked to submit proof of eligibility as certified by your accountant.
Option 2: Sophisticated Investor test^An eligible client is someone who we believe has previous experience that allows them to assess:
- the merits of the product or service; and
- the value of the product or service; and
- the risks associated with holding the product; and
- the client's own information needs; and
- the adequacy of the information given by the licensee; and

At a minimum you'll need to meet the following requirements:
- Have an annual income of at least AUD$100,000 or assets of AUD$500,000
AND can demonstrate you have:
- Traded FX or CFDs 10 times per quarter in the preceding 12 months with a notional value of AUD$50,000 or more
OR
- Work or have worked in the financial sector for at least one year in a professional position which requires knowledge of leveraged trading (or FX or CFDs)

If you’re eligible, it’s easy:
1. Contact you account manager to confirm your Income or Assets.
2. Provide evidence of your work experience or your trading if you have not done the minimum requirements with Pepperstone.
3. Complete and return the Sophisticated Investor Acknowledgement form.
Even if you meet these requirements, in some circumstances, we may still choose to not grant you Pepperstone Pro status.
* Clients that qualify as being treated as wholesale clients pursuant to section 761G(7)(c) of the Corporations Act 2001.
^ Clients that qualify as and agree to being treated as wholesale clients pursuant to section 761GA of the Corporations Act 2001.




If you have any questions, please let us know at pro@pepperstone.com.