7 minute read
Does JustMarkets Reduce Leverage on News? Here’s You Need to Know
from JustMarkets
by Exness_India
If you’re trading with JustMarkets and wondering, “Does JustMarkets reduce leverage on news?” the short answer is yes, they do. Specifically, JustMarkets adjusts leverage during high-impact economic news releases to manage risk, with a High Margin Requirement (HMR) leverage of 1:200 applied to certain assets from 10 minutes before to 5 minutes after such events. This policy also extends to rollovers, weekends, and public holidays for assets like US30, US500, and US100. But why does this matter, and how does it affect your trading? Let’s dive into the details in a to help you understand the ins and outs of JustMarkets’ leverage policy during news events.
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Why Does JustMarkets Reduce Leverage During News?
News events, especially high-impact ones like Non-Farm Payrolls, interest rate decisions, or GDP reports, can send markets into a frenzy. Prices swing wildly, and volatility spikes. JustMarkets, like many brokers, reduces leverage during these periods to protect traders from massive losses. High leverage amplifies both profits and risks, and during volatile news events, the risk of rapid account depletion is real. By lowering leverage to 1:200, JustMarkets ensures you’re not overexposed when the market goes haywire.
This isn’t unique to JustMarkets—it’s a common practice among regulated brokers. The goal is to keep your account safe and prevent negative balances, which is especially crucial since JustMarkets offers Negative Balance Protection. Think of it as a safety net: lower leverage means higher margin requirements, which forces you to trade smaller positions during turbulent times.
How Does JustMarkets Implement This Policy?
Here’s the breakdown of how JustMarkets handles leverage adjustments during news:
Timing: From 10 minutes before to 5 minutes after a high-impact news release, JustMarkets applies a reduced HMR leverage of 1:200. This is a change from their previous policy, which used 1:500 and a shorter 5-minute window.
Affected Assets: The leverage reduction primarily impacts indices like US30 (Dow Jones), US500 (S&P 500), and US100 (Nasdaq). Other instruments may also have reduced leverage depending on their specifications.
Other Periods: The same 1:200 HMR leverage applies during rollovers, weekends, and public holidays, when market liquidity is lower and volatility can spike.
Transparency: JustMarkets provides an Economic Calendar on their website to help you track when major news is due, so you’re not caught off guard.
For example, if you’re trading the US30 index and a major U.S. economic report is about to drop, your maximum leverage will temporarily drop from the usual 1:3000 (for accounts with less than $1,000 in equity) to 1:200. This means you’ll need more margin to open new positions, which can limit your trading size but also reduces your risk exposure.
Why Should You Care About Leverage Reductions?
If you’re a news trader who thrives on volatility, this policy might feel like a buzzkill. High leverage lets you control larger positions with less capital, which can be tempting during fast-moving markets. But here’s the flip side: high leverage during news can wipe out your account in seconds if the market moves against you. JustMarkets’ leverage reduction is a proactive move to keep you in the game.
For scalpers or day traders, this could affect your strategy. You might need to adjust your position sizes or avoid opening new trades during these high-risk windows. On the other hand, if you’re a long-term trader, this policy might not impact you much, as you’re likely holding positions through news events rather than actively trading them.
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How Does JustMarkets’ Leverage Compare?
JustMarkets is known for offering some of the highest leverage in the industry—up to 1:3000 for accounts with low equity (under $1,000). This is massive compared to many brokers, especially those under stricter regulations like CySEC, which caps retail leverage at 1:30. However, during news events, the temporary reduction to 1:200 brings JustMarkets more in line with industry standards for risk management.
Here’s a quick comparison:
Normal Conditions: Up to 1:3000 for major currency pairs, 1:20 for stocks, and varying levels for other assets like commodities or cryptocurrencies.
News Periods: Drops to 1:200 for affected instruments, ensuring safer trading during volatility.
Other Brokers: Many brokers reduce leverage during news, but the extent varies. Some might drop to 1:100 or lower, while others may not allow trading at all during major events.
JustMarkets’ approach strikes a balance: they still allow trading during news (unlike some brokers that restrict it entirely), but with guardrails to manage risk.
How Can You Prepare for Leverage Changes?
Nobody likes surprises in trading, so here are some practical tips to stay ahead of JustMarkets’ leverage reductions:
Check the Economic Calendar: JustMarkets’ Economic Calendar is your best friend. It lists upcoming high-impact news, so you can plan your trades accordingly.
Monitor Your Margin: Before news events, ensure you have enough equity to meet the higher margin requirements. If you’re over-leveraged, you risk a margin call or stop-out.
Adjust Your Strategy: If you’re a news trader, consider reducing position sizes or waiting out the 15-minute window (10 minutes before to 5 minutes after news). Scalpers might want to pause trading during these periods.
Use Demo Accounts: JustMarkets offers free demo accounts to test strategies without risking real money. Practice trading during news events to see how leverage changes affect you.
Contact Support: If you’re unsure about leverage settings or need to adjust them, JustMarkets’ 24/7 customer support is there to help via chat, email, or phone.
Does This Make JustMarkets a Good Broker?
JustMarkets’ leverage reduction during news is a double-edged sword. On one hand, it protects you from catastrophic losses during volatile periods. On the other, it might limit your ability to capitalize on big market moves. So, does this make JustMarkets a good or bad choice?
Pros:
High Normal Leverage: Up to 1:3000 is a dream for traders with small accounts.
Transparency: Clear communication about leverage changes and an accessible Economic Calendar.
Safety Features: Negative Balance Protection and segregated client funds add a layer of security.
Flexible Trading: Supports scalping, hedging, and news trading with no restrictions.
Cons:
Temporary Restrictions: The 1:200 HMR leverage might feel restrictive for aggressive news traders.
Limited Asset Variety: Compared to some competitors, JustMarkets’ non-forex offerings (stocks, crypto) are somewhat limited.
Jurisdiction Restrictions: Traders in certain countries (e.g., U.S., UK, Canada) can’t use JustMarkets due to regulatory restrictions.
Overall, JustMarkets’ leverage policy is a net positive for most traders, especially beginners who benefit from the risk management it enforces. Their 4.4 Trustpilot rating from over 3,000 reviews suggests they’re doing something right.
Final Thoughts: Is It a Dealbreaker?
So, does JustMarkets reduce leverage on news? Yes, they do, and it’s a deliberate choice to prioritize trader safety during volatile market conditions. While this might cramp your style if you’re a high-risk news trader, it’s a smart move for most retail traders, especially with JustMarkets’ sky-high 1:3000 leverage under normal conditions. By staying informed, planning ahead, and using tools like their Economic Calendar, you can navigate these changes without missing a beat.
If you’re looking for a broker with competitive spreads, flexible leverage, and a solid reputation, JustMarkets is worth considering. Just make sure you understand their policies and adjust your strategy to match. Happy trading!
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