This guide, prepared by CESR (The Committee of European Securities Regulators), explains the basics of the Markets in Financial Instruments Directive (MiFID, a new piece of European legislation) for investing in financial products and how it affects clients when dealing with firms that provide investment services in Europe.
MiFID applies to the products that investment firms offer to their clients for services (managing investments, buying and selling financial products, etc.); and one of the main purposes of the directive is to harmonize investor protection throughout Europe.
Financial Instruments and Risks.
An investment in a financial instrument always carries a risk which depends on the nature of the investment. This file describes the nature and risks of financial instruments, and the information depends on the type of product, its complexity and risk profile.
It is noted that it does not disclose all the associated risks or other important aspects of the financial instruments, and it should not be considered as investment advice or recommendation for the provision of any service or investment in any of the financial instruments mentioned therein.
The investor should not carry out any transaction in any financial instruments unless was fully aware of their nature, the risks involved and investor’s exposure in the risks. The investor must seek an independent legal and/or financial advice before taking any investment decision in case of any uncertainty as to the meaning of any of the warnings described therein,
Before providing you with an investment service, a CIF is required to categorize you as a Retail or Professional client. You will normally be categorized as a Retail client, a category which receives the highest level of investor protection.
The Retail client has the right to request a different classification as a Professional client but will be afforded a lower level of protection. However, the Company is not obliged to enter into an agreement and deal with the Client on this basis.
Before categorizing you as a Professional client, the Company will first have to assess if this category is appropriate for you. The purpose of the assessment is to establish that you are capable of making your own investment decisions and you are able to understand the risks involved.
The Professional client has the right to request a different classification
as a Retail client in order to obtain a higher level of protection. However, the Company is not obliged to enter into an agreement and deal with the Client on this basis.
Investors Compensation Fund (for CIF’s Clients).
The Company is a member of the Investor Compensation Fund (the Fund) for Clients of Investment Firms, which was established and operates under the Investment Firms Law 2002 and the relevant Regulations of 2004.
The Object of the Fund is to secure the claims of the covered clients against the members of the Fund through the payment of compensation.
These leaflets (in English
) briefly describe the Cover provided, Covered clients, Payable compensation and Payment procedure.