--- title: "Why some EU traders use a broker’s global company" description: "Why some EU traders open accounts with a broker group’s global company: higher leverage, a smaller margin per trade, and the EU rules that don’t come with it." canonical: https://thetraderwiki.com/en/eu-traders-global-brokers/ lang: en kind: article published: 2026-10-10 updated: 2026-10-15 author: "Samuel T." (https://thetraderwiki.com/en/authors/samuel-t/) html: https://thetraderwiki.com/en/eu-traders-global-brokers/ json: https://thetraderwiki.com/en/eu-traders-global-brokers/index.json --- # Why some EU traders open accounts with a broker’s global company [Home](https://thetraderwiki.com/en/) › [Guides](https://thetraderwiki.com/en/learn/) › [EU traders and global companies](https://thetraderwiki.com/en/eu-traders-global-brokers/) Some traders who live in the EU open an account with a broker group’s global company instead of the group’s EU company. The global company is licensed outside the EU. The main reason they do this is [leverage](https://thetraderwiki.com/en/glossary/#leverage). An EU company can give a [retail client](https://thetraderwiki.com/en/glossary/#retail-client) no more than 30:1 on major currency pairs ([Decision (EU) 2018/796](https://eur-lex.europa.eu/eli/dec/2018/796/oj)). A global company in the same group may offer 200:1 or 500:1 ([broker comparison](https://thetraderwiki.com/en/compare-brokers/#leverage)). Higher leverage means a smaller deposit is enough to open the same trade, so your account can hold a bigger trade. The same leverage that makes a bigger gain possible makes the same loss just as big, and that’s the reason EU regulators cap it. ## Key points - For major currency pairs, the most an EU company can offer a retail client is 30:1. Global companies in the same groups advertise 200:1 or 500:1. - Higher leverage means a trade ties up less [margin](https://thetraderwiki.com/en/glossary/#margin) ([Decision (EU) 2018/796](https://eur-lex.europa.eu/eli/dec/2018/796/oj)). At 30:1, a $100,000 EUR/USD trade needs about $3,333. At 500:1, it needs $200. - Leverage that makes a bigger gain possible makes a loss of the same size just as possible. A small move against a big trade can take a large share of a small account. - The EU’s leverage caps came with a [close-out](https://thetraderwiki.com/en/glossary/#margin-close-out) rule, [negative balance protection](https://thetraderwiki.com/en/glossary/#negative-balance-protection) and a standard risk warning. A global company decides its own terms for each of these. - Opening an account with a global company has to be your own decision ([broker groups and regulators](https://thetraderwiki.com/en/broker-groups-and-regulators/#europeans-and-global-companies)). ## Leverage and the other reasons EU traders give *Worked arithmetic: the numbers follow from the formula given in this section.* Leverage is the first reason. A $100,000 trade on EUR/USD calls for about $3,333 in margin at 30:1, but at 500:1 you need $200. With a small account you can open trades at a global company that an EU company wouldn’t let you open at all. The second reason is fewer limits by asset. For gold and major indices, EU rules cut leverage to 20:1, for other commodities to 10:1, for shares to 5:1 and for crypto to 2:1 ([Decision (EU) 2018/796](https://eur-lex.europa.eu/eli/dec/2018/796/oj), [leverage and margin](https://thetraderwiki.com/en/leverage-and-margin/#retail-caps)). A global company sets its own figures and they’re usually higher. Fewer rules on the account are the third point. If you trade with an EU company, your trades must be closed when your equity falls to half the margin you need ([margin close-out](https://thetraderwiki.com/en/glossary/#margin-close-out)). A global company closes your trades at whatever level its own terms set, so a trade can stay open longer when the price moves against you. ## An EU company and a global company side by side An EU company and a global company in the same group can sell the same instruments under very different rules. The table sets the EU rules against what the global companies covered on this site publish ([Decision (EU) 2018/796](https://eur-lex.europa.eu/eli/dec/2018/796/oj), [global companies](https://thetraderwiki.com/en/offshore-brokers/)). *The rules at an EU company against those at a global company in the same group, for a retail client.* | | EU company | Global company | | --- | --- | --- | | Regulator | A national EU regulator such as [CySEC](https://www.cysec.gov.cy/), [BaFin](https://www.bafin.de/) or the [KNF](https://www.knf.gov.pl/), applying [ESMA’s](https://www.esma.europa.eu/) [CFD](https://thetraderwiki.com/en/glossary/#cfd) restrictions | The Seychelles Financial Services Authority, the Securities Commission of The Bahamas, the Bermuda Monetary Authority or the Financial Services Commission of Belize | | Leverage on major currency pairs | 30:1 | 200:1 or 500:1 at the groups on this site | | Margin for a $100,000 trade on EUR/USD | About $3,333 | $500 at 200:1 and $200 at 500:1 | | Leverage on shares and crypto | 5:1 on shares and 2:1 on crypto | Set by each company | | Margin close-out | At 50 % of the margin needed | At the level the company’s terms set | | Negative balance protection | Required | A right, a courtesy or absent, depending on the company | Each row on the global side depends on the company. Check the agreement of the company that would hold your account, not the group’s marketing. ## What higher leverage does to the numbers *Worked arithmetic: the numbers follow from the formula given in this section.* Suppose your made-up account holds $1,000 and you want to place a $100,000 trade on EUR/USD. At 30:1 the margin is about $3,333, so an EU company won’t let this account open the trade. With 500:1 the margin is $200, and the trade opens with $800 to spare. If the price moves 0.5 % in your favour, the trade gains $500, half the account’s size. At the EU company, that gain is only possible if you put in at least $3,333 of margin first. Now suppose the price moves 0.5 % against you. The trade loses $500 from such a small move, and that sum is half your account. A 1 % move the wrong way can wipe out the entire $1,000. ## Why EU regulators cap leverage, and what a global company does instead In 2018, after national regulators found that 74 % to 89 % of retail accounts lost money when trading CFDs, [ESMA](https://www.esma.europa.eu/) set the caps ([ESMA press release, 27 March 2018](https://www.esma.europa.eu/press-news/esma-news/esma-agrees-prohibit-binary-options-and-restrict-cfds-protect-retail-investors)). A cap restricts how big a trade can be against the money in the account. So it also restricts how fast that money can go. The caps also brought rules for retail clients: a close-out at 50 % of margin, negative balance protection and the standard risk warning ([ESMA Decision (EU) 2018/796](https://eur-lex.europa.eu/eli/dec/2018/796/oj)). These are the rules a company licensed in the EU applies. A global company applies its own regulator’s rules and its own contract, and those may or may not include them. Negative balance protection depends on the company. Some global companies offer it as a right, and some provide it only at their discretion. At least one global company makes you pay any deficit ([global companies](https://thetraderwiki.com/en/offshore-brokers/#protection)). ## Questions about EU traders and global companies Questions about EU traders and global companies are mostly about whether it’s allowed and what it changes. ### Do global companies take clients who live in the EU? Some global companies take clients who live in the EU. EU law allows a firm outside the EU to serve someone in the EU only if the client approaches it first ([broker groups and regulators](https://thetraderwiki.com/en/broker-groups-and-regulators/#europeans-and-global-companies)). ### Does higher leverage make a trade more likely to profit? No. With higher leverage you can open a larger trade from the same deposit. Each price move then becomes a bigger gain or a bigger loss relative to your money, while the odds of the price moving in your favour remain unchanged. ### Do global companies give negative balance protection? Some global companies give negative balance protection. Whether a global company offers negative balance protection comes down to its regulator and its contract. Some grant it as a right, some only at their discretion and at least one gives none at all. Read the agreement of the company that would hold your account. ## More leverage cuts both ways > **Risk warning.** More leverage cuts both ways. A larger gain becomes possible from the same deposit, but the same loss arrives faster. Before you open any account, at any company, read the [risk disclosure](https://thetraderwiki.com/en/risk-disclosure/). ## Sources The original documents this page cites, in the order they first appear. 1. [ESMA Decision (EU) 2018/796 of 22 May 2018 to temporarily restrict contracts for differences in the Union](https://eur-lex.europa.eu/eli/dec/2018/796/oj), Official Journal of the European Union (EUR-Lex), 2018-05-22 2. [Cyprus Securities and Exchange Commission](https://www.cysec.gov.cy/), CySEC 3. [Bundesanstalt für Finanzdienstleistungsaufsicht](https://www.bafin.de/), BaFin 4. [Komisja Nadzoru Finansowego](https://www.knf.gov.pl/), KNF 5. [European Securities and Markets Authority](https://www.esma.europa.eu/), ESMA 6. [ESMA agrees to prohibit binary options and restrict CFDs to protect retail investors](https://www.esma.europa.eu/press-news/esma-news/esma-agrees-prohibit-binary-options-and-restrict-cfds-protect-retail-investors), ESMA, 2018-03-27 ## Related pages - [Broker groups and regulators: who opens your account](https://thetraderwiki.com/en/broker-groups-and-regulators/): Why one broker brand runs several companies, each licensed by a different regulator. - [Offshore forex brokers and CFD companies compared](https://thetraderwiki.com/en/offshore-brokers/): The global companies behind familiar brands, who regulates them and what their own terms say. - [Maximum leverage: what “up to 500:1” really means](https://thetraderwiki.com/en/maximum-leverage/): Why the leverage a provider advertises isn’t the leverage you get, and what you give up to reach it. - [What is leverage in trading? Leverage and margin](https://thetraderwiki.com/en/leverage-and-margin/): What leverage does to your buying power, the margin terms your platform uses and who sets the limits. - [CFD and forex broker comparison: leverage and platforms](https://thetraderwiki.com/en/compare-brokers/): Six brokers in nineteen countries, compared on facts you can check yourself. --- CFDs are complex, leveraged products, and the regulators’ own figures show that most retail accounts lose money. Nothing on TheTraderWiki is investment advice. Read the full [risk disclosure](https://thetraderwiki.com/en/risk-disclosure/), and if you’re unsure, talk to a qualified adviser. Broker details can change and they can be wrong. Before you open an account, confirm them with the broker and the regulator’s register.