General Risk Disclosure Statement

PLEASE READ THIS RISK DISCLOSURE STATEMENT CAREFULLY. BY EXECUTING THE ACCOUNT MANDATE, ACKNOWLEDGEMENT, AND CONFIRMATION, YOU ACKNOWLEDGE THAT YOU HAVE READ THIS RISK DISCLOSURE STATEMENT AND UNDERSTAND THE RISKS APPLICABLE TO THE AXAFOREX.com’S VARIOUS SERVICES AND PRODUCTS.

The risk of loss in Trading Assets and other Investments, including leveraged foreign exchange, foreign exchange, options, securities, commodities, debt instruments, or derivatives or in other Transactions can be substantial. You should therefore carefully consider whether such Transactions or Investments either entered into directly by you or through us on a discretionary managed basis is suitable for you in light of your investment objectives, financial circumstances, your tolerance to risks, and your investment experience. In considering whether to trade or invest, you should inform yourself and be aware of the risks generally, and in particular, should note the following.

1.1 Margin Financing - Trading by way of margin financing in any investment arrangement involves the risk that adverse market movements may give rise to losses substantially over the sums deposited by way of margin and the placing of such a margin as security in no way limits your liability in the event of such losses being sustained. You will be liable without limit for all such losses. The use of leverage can therefore lead to large and unlimited losses as well as gains.

1.2 Loss of Margin and Other Amounts - If at the AXAFOREX.com’s discretion you trade on a margin basis, you may sustain a total loss of the initial margin funds and any additional funds and assets that you deposit with AXAFOREX.com to establish or maintain a position in the relative market. If the market moves against your position, you may be called upon by AXAFOREX.com to deposit a substantial amount of additional margin funds, on short notice, to maintain your position. If you do not provide the required additional funds or fail to make interest payments within the prescribed time or if the market moves against you further before the receipt by the AXAFOREX.com of the additional funds, notwithstanding that the prescribed time has not elapsed, the AXAFOREX.com at its sole discretion may (but it is not obliged to) close at the market rate all or any of your positions that you may have and liquidate your collateral without your consent or prior notice.

1.3 Liquidation May Not be Possible - Under certain market conditions, you may find it difficult or impossible to liquidate a position. This can occur, for example, when the market makes a “limit move” or trading is suspended by the relevant Exchange. Also, there may not be a ready market for certain investments and market traders may not be prepared to deal in certain investments. Some investments may have to be held to maturity, for instance, some index options can only be exercised on the expiry date, whilst other index options may be exercised at any time before expiry. Proper information for determining the value of certain investments may not be available.

1.4 Limitation Orders May Not Limit Loss - Placing contingent orders, such as “stop-loss” or “stop-limit” orders will not necessarily limit your losses to the intended amounts, since market conditions may make it impossible to execute such orders. Under certain circumstances, it may be difficult or impossible to assess the value of your position, determine a fair price, or assess your risk exposure.

1.5 Spreads - A “spread” position may not be less risky than a simple “long” or “short” position.

1.6 Warrants - Warrants often involve a high degree of gearing so that a relatively small movement in the price of the Underlying Securities, Structured Investments, and Trading Assets to which the warrant relates may result in a disproportionately large movement, unfavorable or favorable, in the price of the warrant.

1.7 Custodian and Broker Risks - Instruments may be held or delivered for settlement to a custodian or broker appointed in good faith by AXAFOREX.com, or by its nominees or sub-custodians. Such persons are not under the control of AXAFOREX.com, and AXAFOREX.com accepts no liability for any default of any nature by such third-party custodians or brokers or arising from the transfer of instruments to any such third party for any purposes, and in the event of any such default, you may suffer total or partial loss in respect of your investment. You should familiarize yourself with the protections given to money or other property which AXAFOREX.com deposits on your behalf for domestic and foreign transactions, particularly in the event of the insolvency or bankruptcy of a custodian or broker. The extent to which you may recover your money or property may be governed by specific legislation or local rules. In some jurisdictions, a property that may be identified as your own will be pro-rated in the same manner as cash for purposes of distribution in the event of a shortfall.

1.8 General Securities, Structured Investments, and Trading Assets Risks - Any trading in securities, Structured Investments, and Trading Assets carry investment risks. In particular, the price or value of any securities, Structured Investments and Trading Assets can and does fluctuate and may even become valueless, resulting in possible loss not only of profit but also of all or part of the principal sums invested. There is an inherent risk that losses may be incurred rather than profit made as a result of buying and selling securities. Past performance of any investment is not necessarily indicative of future performance.

1.9 Issuer or Counter-party Risks - If the issuer of any securities, Structured Investments Trading Assets or other instruments or a trading counter-party becomes unable to meet its obligations then such investments may become worthless and any trading costs and profits irrecoverable.

1.10 Country Risks - If an investment is made in any asset or issued by a party subject to foreign laws or transactions made on markets in other jurisdictions, including markets formally linked to a domestic market, recovery of the sums invested and any profits or gains may be reduced, delayed or prevented by exchange controls, debt moratorium or other actions imposed by the government or other official bodies. Before you trade you should enquire about any rules relevant to your particular transactions. Your local regulatory authority will be unable to compel the enforcement of the rules of regulatory authorities or markets in other jurisdictions where your transactions have been affected. You should obtain details about the different types of redress available in both your home jurisdiction and other relevant jurisdictions before you start to trade.

1.11 Currency Risks - Where trading contracts or other investments are denominated in currencies other than your primary reference currency, or where you convert funds from another currency upon investing, there is the risk that if the foreign exchange markets move against you, then upon maturity or any earlier dealing the net proceeds converted into your primary reference currency, or the currency from which the initial funds were converted (as the case may be), may be significantly less than the equivalent figure on the date the contract was entered into or the investment made and that any income or gains made may be entirely negated. Where your indebtedness to AXAFOREX.com is secured by assets denominated in a currency different from the currency of the indebtedness, the foreign exchange market may move against you and the risk of loss can be substantial. In the case of foreign currency deposits, the net return on your foreign currency deposit(s) will depend on market conditions prevailing at the time of maturity. In this regard, you may suffer loss as a result of the depreciation of the value of the currency paid as a result of foreign exchange controls imposed by the country issuing the Appendix 5: General Risk Disclosure Statement currency. Such loss may offset the net return on your deposit(s) and may result in losses to such deposit(s). Repayment or payment of amounts due to you may be delayed or prevented by exchange controls or other actions imposed by governmental or regulatory bodies.

1.12 Off-Exchange Transactions - Transactions may be traded off-exchange or on an over-the-counter basis. Non-exchange traded or “nontransferable” instruments may not be readily realizable and are not regulated by the rules of any exchange. Situations may arise where no market traders are prepared to deal with them or no proper information may be available to determine their value. Sometimes it may not be possible to obtain a price quotation. Minimum transaction amounts may be imposed and/or changed by traders from time to time.

1.13 Taxation - Income or profit from trading in any investments may be subject to withholding tax or capital gains tax or other tax of the country of the issuer or the country in which such investments are traded. In such event, unless the issuer agrees to gross up the income or profit received by the investors, the investors will only receive the interest payment or proceeds of sale or redemption of the investment less the withholding tax or capital gains tax, or other tax. Retention tax operated by paying agents may be applied in certain jurisdictions.

1.14 AXAFOREX.com Not Market Maker - We have no obligation to make a market price to you if your favorable price level cannot be obtained or there is no buyer in the market, nor to buy back any Securities, Structured Investments, and Trading Assets or other investments from you unless we have written an option requiring us to do so in certain circumstances.

1.15 Commissions and Other Charges - Before you begin to trade, you should obtain a clear explanation of all commissions, fees, and other charges for which you will be liable. These charges will affect your net profit (if any) or increase your loss.

2.1 Market Volatile - Trading in foreign exchange and/or commodities is entirely speculative and carries inherent risks not ordinarily experienced in less volatile investment arrangements. Foreign exchange markets and/or commodity markets may move abruptly or unpredictably and substantial losses may be incurred. The risk of loss in leveraged foreign exchange trading can be substantial.

2.2 Alternative Currency Risks - Currency-linked options are inherently speculative and carry risks not ordinarily experienced in single currency deposit arrangements. In particular foreign currency market movements are unpredictable and may result in you receiving, at the determination of AXAFOREX.com, on the maturity of the deposit an amount in the pre-selected currency (the alternative currency) which, if converted at the prevailing exchange rate back to your original investment currency (the base currency), is less than the agreed amount in the base currency payable upon maturity. Other cross-currency arrangements carry similar risks.

2.3 Market Movements - Instruments may be issued with fixed, floating, or zero interest rates. Instruments bearing fixed interest payments or zero-coupon instruments issued at a discount will be adversely affected by rising market interest rates and the longer the term of The instrument, the greater the interest rate risk or benefit from the movement of the market interest rate.

2.4 Pre-maturity Dealings - Market movements are unpredictable and unless the Instrument is held to maturity it may not be possible to realize the Instrument either at a reasonable price or at all.

2.5 Synthetic Products - In circumstances where Instruments constitute synthetic products that have resulted in different currencies, investments, and interest terms to that of the underlying instrument itself, the swaps which may be so involved may mean additional risk or loss to you if there are defaults or problems with the relevant underlying Instruments.

2.6 Swap Transactions - Swap transactions involve the obligation to exchange revenue flows of different types. Movements in exchange rates, interest rates, or the market price of the underlying instruments of the swap transaction may significantly affect your position. Movements in exchange rates, interest rates, or the market price of the underlying instruments of the swap transaction can also be affected by various factors, including inflationary fears and weakening currency. There may not be any logical reason for markets to act in a certain way, making it difficult to anticipate such movements.

3.1 Leveraged Foreign Exchange Trading
(a) Effect of “Leveraged” or “Gearing” - Transactions in leveraged foreign exchange carry a high degree of risk. The amount of initial margin is small relative to the value of the leveraged foreign exchange transaction so that the transaction is highly “leveraged” or “geared”. A relatively small market movement will have a proportionately larger impact on the funds you have deposited or will have to deposit; this may work against you as well as for you. You may sustain a total loss of the initial margin funds and any additional funds deposited with AXAFOREX.com to maintain your position. If the market moves against your position or margin levels are increased, you may be called upon to pay substantial additional funds on short notice to maintain your position. If you fail to comply with a request for additional funds within the time prescribed, your position may be liquidated at a loss and you will be liable for any resulting deficit in your account. Under certain market conditions, you may find it difficult or impossible to liquidate a position. The high degree of leverage that is often obtainable in leveraged foreign exchange trading can work against you as well as for you. The use of leverage can lead to larger losses as well as gains.
(b) Risk-Reducing Orders or Strategies - The placing of certain orders (e.g. “stop-loss” orders, where permitted under local law, or “stop-limit” orders) which are intended to limit losses to certain amounts may not be effective or necessarily limit your losses to the intended amounts because market conditions may make it difficult or impossible to execute such orders. At times, it is also difficult or impossible to liquidate a position without incurring substantial losses. Strategies using combinations of positions, such as “spread” and “straddle” positions may be as risky as taking simple “long” or “short” positions.

3.2 Binary Options
(a) Variable Degree of Risk - Transactions in options carry a high degree of risk. Purchasers and sellers of options should familiarize themselves with the type of options (i.e. put or call) which they contemplate trading and the associated risks. You should calculate the extent to which the value of the options would have to increase for your position to become profitable, taking into account the premium paid and all transaction costs. The purchaser of options may offset its position by trading in the market or exercising the options or allowing the options to expire. The exercise of an option results either in a cash settlement or in the purchaser acquiring or delivering the underlying interest. If the option is on a leveraged foreign exchange transaction, the purchaser will have to acquire a leveraged foreign exchange position with associated liabilities for margin (see the section on Leveraged Foreign Exchange Trading above). If the purchased options expire worthlessly, you will suffer a total loss of your investment which will consist of the option premium paid plus transaction costs. If you are contemplating purchasing deep-out-of-the-money options, you should be aware that, ordinarily, the chance of such options becoming profitable is remote.
Selling (“writing” or “granting”) an option generally entails considerably greater risk than purchasing options and if you sell or write an option, you accept a legal obligation to purchase or sell the underlying asset if the option is exercised against you. Although the premium received by the seller is fixed, the seller may sustain a loss well over the amount of premium received. The seller will be liable to deposit an additional margin to maintain the position if the market moves unfavorably. The seller will also be exposed to the risk of the purchaser exercising the option and the seller will be obligated to either settle the option in cash or to acquire or deliver the underlying interest. If the option is on a leveraged foreign exchange transaction, the seller will acquire leveraged foreign exchange position with associated liabilities for margin (see the section on Leveraged Foreign Exchange Trading above). If the option is “covered” by the seller holding a corresponding position in the underlying leveraged foreign exchange transaction or another option, the risk may be reduced. If the option is not covered, the risk of loss can be unlimited. Certain exchanges in some jurisdictions permit deferred payment of the option premium, limiting the liability of the purchaser to margin payments not exceeding the amount of the premium. The purchaser is still subject to the risk of losing the premium and transaction costs. When the option is exercised or expires, the purchaser is responsible for any unpaid premium outstanding at that time.

3.3 Transactions in Other Jurisdictions - Transactions on markets in other jurisdictions, including markets formally linked to a domestic market, may expose you to additional risk. Such markets may be subject to a rule which may offer different or diminished investor protection. Before you trade, you should enquire about any rules relevant to your particular transactions. Your local regulatory authority will be unable to compel the enforcement of the rules of the regulatory authorities or markets in other jurisdictions where your transactions have been effected. You should ask AXAFOREX.com for details about the type of redress available in both your home jurisdiction and other relevant jurisdictions before you start to trade.

3.4 Currency Risks - The profit or loss in transactions in foreign currency-denominated options contracts (whether they are traded in your own or another jurisdiction) will be affected by fluctuations in currency rates where there is a need to convert from the currency denomination of the contract to another currency.

3.5 Trading Facilities - Most open-outcry and electronic trading facilities are supported by computer-based component systems for the order routing, execution, matching, registration, or clearing of trades. As with all facilities and systems, they are vulnerable to temporary disruption or failure. Your liability to recover certain losses may be subject to limits on liability imposed by the system provider, the market, the clearinghouse, and or its members. Such limits may vary. You should ask AXAFOREX.com for details in this respect.

3.6 Electronic Trading - Trading on an electronic trading system may differ not only from trading in an open-outcry market but also from trading on other electronic trading systems. If you undertake transactions on an electronic trading system, you will be exposed to risks associated with the system including the failure of hardware and software. The result of any system failure may be that your order is either not executed according to your instructions or not executed at all.

3.7 Managed Accounts - For managed accounts, substantial charges for management and advisory fees may be levied and therefore, it may be necessary for these accounts that are subject to these charges to make substantial trading profits to avoid depletion or exhaustion of their assets.

3.8 Margin - “Margin” means an amount of money, securities, property, or other collateral, representing a part of the value of the contract or agreement to be entered into, which is deposited by the buyer or the seller or such other party in a leveraged foreign exchange transaction to ensure the performance of the terms of the leveraged foreign exchange transaction.

3.9 Contracts for Difference (‘CFDs’) are complex financial products that are traded on margin. Trading CFDs carries a high degree of risk. 75% of retail investor accounts lose money when trading CFDs with this provider. It is possible to lose all your capital. These products may not be suitable for everyone and you should ensure that you understand the risks involved. Seek independent expert advice if necessary and speculate only with funds that you can afford to lose. Please think carefully about whether such trading suits you, taking into consideration all the relevant circumstances as well as your resources. We do not recommend clients post their entire account balance to meet margin requirements. Clients can minimize their level of exposure by requesting a change in leverage limit. For more information please refer to AXAFOREX.com’s Risk Disclosure. Additionally, the content of this email is for information purposes only and it is not intended as a recommendation or advice. Any indication of past performance or simulated past performance included in advertisements published by AXAFOREX.com is not a reliable indicator of future results.

4.1 Sufficient Expertise - By entering into any Transaction, you confirm that you have read and fully understood this Risk Disclosure Statement, the term sheets and all annexures about the Transaction, the nature of the Transaction, and the terms and conditions governing the Transaction as well as the margin requirements (if applicable). You further acknowledge that:
(a) you understand are familiar with and are fully aware of the risks related to the Transaction;
(b) you are willing to take all such risks;
(c) you are capable of bearing a full loss of the amounts invested as a result of or in connection with any Transaction entered into with AXAFOREX.com and any additional loss over and above the initial amounts invested; and
(d) neither AXAFOREX.com nor any of its officers, employees, or agents have made any recommendation or given any advice as to the terms and the profitability of the Transaction. Accordingly, you agree that you are and shall at all times be fully responsible for any Transaction you choose to enter into and that you shall not have relied on any communication from AXAFOREX.com.

5.1 AXAFOREX.com is not responsible for the trading results of managing traders and does not guarantee investors and managing traders any profit. The company guarantees only that investment funds, profits, or losses will be divided between clients, according to the established percentage ratios for the distribution of profits, and the specified penalties for early detachment of investments.

5.2 The management of your funds by other traders with PAMM accounts does not guarantee you profit. There is a risk of losing your funds when investing in a PAMM account.

6.1 No Tax Advice - Please also note that we do not offer tax advice of any nature and whilst we may provide information or express opinions from time to time, such information or opinions are not offered as tax advice. You should decide upon any dealing only after having made all such inquiries and assessments as you consider appropriate, and you should place no reliance on us to give advice or make recommendations.

6.2 Independent Advice - If you are in any doubt about the risks involved in any trading or investment arrangements or you are uncertain of or have not understood any aspect of this Risk Disclosure Statement, you should seek independent professional advice.