The 100% Credit Bonus is intended to offer the following benefits to HotForex clients:

1. Effectively makes the Stop Out on Cash Balance (Balance excluding Credit Bonus) zero.

No Bonus Example:

A client deposits 10,000 USD but elects not to obtain the 100% Credit Bonus. The account is a Premium Account and has a leverage of 1:100. He opens a BUY position in EURUSD of 1 Standard Lot (100,000). The required margin to support this position is 1,000 USD (Used Margin). The market starts moving against the client and the position starts losing money as the market makes a drastic drop.

The Margin Call level is 50% of used margin and the Stop Out Level is 20% of used margin. The open position of the client continues to lose more money and the equity of the account drops to 500 USD. At this point the client receives a Margin Call since the equity of the account is at 50% of Used Margin.

The price of EURUSD keeps dropping and the cash equity of the account now falls to 199 USD which is 1 USD below 20% of used margin. Therefore the client’s open position will be stopped out.

Summary: The client’s open position was closed when the cash equity of his account reached 199 USD.

100% Credit Bonus Example:

A client deposits 10,000 USD and chooses to take the bonus. The client now has their 10,000 cash deposit plus 10,000 USD as a Credit bonus. The account is a Premium Account and has a leverage of 1:100. He opens a BUY position in EURUSD of 1 standard Lot (100,000). The required margin to support this position is 1,000 USD (Used Margin). The market starts moving against the client and the position starts losing money as the market makes a drastic drop.

Normally the Margin Call level is 50% of used margin and the Stop Out Level is 20% of used margin. However because the client chose to get the Credit bonus, the open EURUSD position will only get stopped out when the equity goes below the level of the bonus.

The client’s open position continues to lose more money and the equity of the account drops to 500 USD. At this point the client will not receive a Margin Call since he has the Credit Bonus in his account.

The price of EURUSD keeps dropping and the equity of the account now falls to 199 USD which is 1 USD below 20% of used margin. The clients’ position will not be stopped out; instead, the clients’ position will only be stopped out when the cash equity of the account drops to zero.

Summary: The client’s open position was closed when the cash equity of his account reached 0 USD.

2. Can be used as increased Leverage

No Bonus Example:

A Client deposits 10,000 USD in his account and elects not to take the 100% Credit Bonus. The account leverage is set at 1:100.

Therefore the maximum position size the client can open is 10 Standard Lots (1,000,000 / 100 = 10,000 in used margin).

100% Credit Bonus Example:

A client deposits 10,000 USD in his account and chooses to take the 100% Credit Bonus. The account leverage is set at 1:100. The client now has in his account 10,000 USD cash plus 10,000 USD in Credit Bonus.

Therefore the maximum position size the client can open is 20 Standard Lots (2,000,000 / 100 = 20,000 in used margin).

Summary: By choosing to take the Credit Bonus, the client can use it as higher leverage. Please note that higher leverage also means higher risk.

3. Can be withdrawn under certain conditions

100% Credit Bonus Example:

A client deposits 1500 USD and elects to get the 100% Credit Bonus. The client will be able to withdraw the bonus after trading a total volume of 1000 Standard Lots (where each  lot traded equals to 1.5 USD of bonus).

NOTE: Unlike most other bonus programs, there is no limit imposed in completing the volume requirements. Therefore, we encourage prudent trading practices in completing the volume requirements.