Every week we provide insights into popular assets and hot questions, so you can easily learn more about the investment market in bite‑sized pieces.
This week, we take an in-depth look at the benefits of trading Contracts for Difference (CFDs) with a regulated broker, particularly focusing on the investor compensation scheme.
Who Regulates Your Investments
CFDs on the Change App are offered via Change Securities B.V., a licensed investment firm in the Netherlands authorized by the Dutch Authority for the Financial Markets (AFM). The AFM oversees regulated brokers to ensure transparency and fair practices.
Understanding Investor Compensation
Trading CFDs involves risk - prices can go up or down, and there is a possibility of loss. But regulated brokers may also fall into trouble - and that’s where the investor compensation scheme comes in: it provides additional protection in case the firm becomes insolvent or mismanages client assets.
How the Investor Compensation Scheme Works
- In the Netherlands, investment firms must segregate client assets from their own capital. This means your funds and investments are held separately, not mixed with the broker’s operating capital.
- If the broker fails — for example, through bankruptcy or mismanagement - the Dutch Investor Compensation Scheme (administered by De Nederlandsche Bank) can reimburse eligible clients.
- The compensation is up to EUR 20,000 per person per firm.
What This Means for You with Change
Because Change Securities B.V. is regulated and participates in the compensation scheme, your investments via their CFD services benefit from a safety net - up to €20,000 - in case of extreme failure.
Additionally, you can start trading CFDs for as little as €10, making markets accessible even at a modest investment level.
Until next week - trade smart, trade safe!
