Target Market Determination (TMD)

1. Product Description

Leveraged trading products including FX pairs, Contracts for Difference (CFDs) over indices, commodities, and cryptocurrencies, offered via GLOBEX’s proprietary and approved third-party platforms. Products may be margined, involve financing costs, and are intended for active traders who understand leverage, volatility, and liquidity risks.

2. Target Market Summary

• Intended clients: Retail clients with medium-to-high risk tolerance seeking short- to medium-term trading exposure, not long-term wealth preservation.
• Investment objective: Trading returns through directional or hedging strategies; acceptance of potential rapid losses.
• Time horizon: Intraday to several months; frequent monitoring expected.
• Distribution: Direct online channels with appropriateness testing and risk warnings.

3. Needs, Objectives & Financial Situation

• Clients seeking leveraged exposure and tactical trading opportunities.
• Clients with disposable capital who can afford losses without compromising essential living costs or critical obligations.
• Not designed for capital guarantee, income certainty, or principal protection.

4. Client Knowledge & Experience

Suitable for clients who have prior experience with margin products or who successfully demonstrate understanding of:

• Leverage, margin calls, liquidation risks, and the impact of volatility and gaps.
• Order types, spreads, commissions, swaps/financing, and slippage.
• Underlying market fundamentals and news-driven price dynamics.

5. Risk Tolerance & Capacity for Loss

• Clients with medium-to-high risk tolerance who accept that losses may exceed initial investment.
• Capacity to meet margin requirements and withstand drawdowns without undue hardship.
• Comfort with rapid price movements and potential for sudden liquidation.

6. Distribution Conditions

• Account opening subject to KYC/AML checks and sanctions screening.
• Appropriateness assessment prior to enabling leveraged trading; enhanced warnings for borderline outcomes.
• Provision of key risk disclosures and product summaries before first trade.
• Leverage limits, margin controls, negative balance protection (where applicable), and real-time risk alerts.
• Ongoing communications including statements, margin alerts, and incident notifications.

7. Negative Target Market

• Clients who require capital protection or guaranteed returns.
• Clients with low risk tolerance or without capacity to bear losses.
• Clients unwilling or unable to actively monitor positions and margin.
• Clients who fail appropriateness assessments and/or decline to accept risk warnings.
• Residents of jurisdictions where products are restricted or prohibited.

8. Key Risks

• Leverage risk: amplified gains and losses; small moves can trigger liquidation.
• Market risk: volatility, gaps, and slippage around news and illiquid periods.
• Liquidity risk: widened spreads, partial fills, or re-quotes in stressed markets.
• Operational risk: connectivity, platform, or third-party failures.
• Counterparty/credit risk: exposure to the issuer or liquidity providers.
• Regulatory risk: rule changes that affect leverage, margin, or product availability.

9. Appropriateness / Suitability Tests

Before enabling trading, clients complete an appropriateness questionnaire covering leverage, margin, risks, and product costs. Outcomes may be: Pass (enable trading), Borderline (enhanced warnings/education), or Fail (decline access).

10. Review Triggers

• Material regulatory change affecting product features, distribution, or protections.
• Significant market dislocation or abnormal volatility/liquidity events.
• Adverse incident trends: complaints, inappropriate sales indicators, or harm outcomes.
• Product feature changes: leverage parameters, margin methodology, fees.

11. Review Frequency

Regular review: at least annually.
Out-of-cycle review: as soon as practicable following any review trigger.

12. Distributor Reporting

• Immediate (as soon as practicable): significant complaints, incidents, or indicators of harm.
• Quarterly: complaints data, appropriateness outcomes, and distribution metrics.
• On request: additional data necessary to assess target market alignment.

13. Document Control

• Version: 1.0
• Owner: Product Governance & Compliance
• Effective Date: August 11, 2025
• Next Review: within 12 months, or earlier upon triggers