Counting more than 12 years of presence in the global market, TopFX has managed to provide an additional alternative to traditional brokerage products, such as CFDs, which are aimed at traders looking for increased risk with high returns.
Forbes had the opportunity to speak with the TopFX Group CEO, Alex Katsaros, who explains how a CFD works, refers to the "king" of investment products and the differences between institutional and private investors while also revealing the company's future expansion plans.
By Matina Charkoftaki
- TopFX is an investment firm with a long history of providing investment services. Can you give us more information about its presence in the global and European markets?
With a proud history dating back to 2010, TopFX has been a trusted player in the industry for over a decade. TopFX is a group of companies that specializes in investment products, specifically Contracts for Differences (CFDs), and serves clients across Europe, Asia, and Africa.
We are committed to delivering a unique experience to traders and investors by offering alternative financial products with advanced tools and features designed to enhance their success.
At TopFX, we serve traders who are looking to maximize their returns through high-risk, high-reward Contracts for Differences (CFDs). European traders can access these financial products through our branch in Cyprus, which is currently the most important hub for investment firms in the European Union.
- What exactly is a CFD, and what does "high-risk, high-reward” mean in practical terms?
A Contract for Difference (CFD) is a widely regulated financial product that offers exciting opportunities for traders globally.
CFDs provide a flexible trading solution where you can take advantage of market price movements. When you open a position, you can either 'buy' (go long) if you believe the price will rise or 'sell' (go short) if you believe it will fall. Your profit or loss is calculated based on the difference between the opening and closing price of your position. For instance, if you buy gold CFDs at $1800 per ounce and close the position at $1900 per ounce, you would have a profit of $100 per contract.
With CFDs, you can trade a wide range of products, including stocks, forex, indices, energies, cryptocurrencies, and more, without having to physically own the underlying asset. This eliminates challenges such as managing physical crypto wallets or gold storage, making CFDs a convenient option.
CFDs offer the potential for higher returns, but it's important to understand that this is tied to the use of leverage. For example, with a deposit of 1,000 euros and a leverage of 30, we control 30,000 euros. However, this also increases the risk as the potential profit or loss from the investment of 30,000 euros will be calculated based on the deposit of only 1,000 euros. This means that a 100% profit can easily increase the account to 2,000 euros, but it can also just as quickly reduce it to zero. It's important to note that the use of leverage is a choice and not a requirement for the investor, who can choose the amount of leverage that best suits their investment profile through the trading platform's available technology and tools.
- If an investor without prior CFD experience wants to start trading, what should they know?
No prior experience with CFDs is necessary to start trading. All that is required is an understanding of the inherent risks involved. Opening an account is a simple process that only requires a valid ID and a utility bill. Deposits can be made using a credit card or bank transfer at no cost to the trader. The process is available in English and various other languages.
Next, the client completes a questionnaire and downloads the platform's app to their mobile device, browser, or computer. After the successful download, clients are ready to start trading. To start the trading process, the client simply opens and closes positions by buying or selling CFDs, based on their speculation of whether the asset's value will increase or decrease.
- What’s TopFX’s competitive advantage over other brokers?
TopFX was originally established as an institutional broker, providing liquidity for a full range of products to other investment firms. This means that other brokers accept to redistribute our price feed and choose through strict risk management criteria whether to send orders to TopFX for execution.
As a result, our offering has evolved to meet a high set of standards, including speed, reliability, and fees. With over 500 assets to choose from, we provide low spreads and transaction fees that are significantly lower compared to traditional stockbrokers. Additionally, our leverage feature allows investors to trade with larger capital than their deposited amount.
We also provide support in various languages from knowledgeable account managers who are ready to assist anyone starting in the CFD market through real-time online communication. They are also available for online or in-person seminars.
- You target both institutional and private investors. Who is easier to work with and what are their requirements?
Indeed, institutional and private investors have distinct needs when it comes to investing. Institutional investors are primarily concerned with practical aspects, such as the speed of transactions, the cost of buying and selling, commissions, the safety of their funds, and access to customer support.TopFX is a highly regarded company in the industry and is part of a select group of companies. As one of the oldest companies in the business, we have a strong reputation.
On the other hand, private investors require more education and stronger marketing efforts to become familiar with the brand. They may struggle with complying with regulatory requirements and may have trouble submitting the necessary identification documents correctly and promptly. As such, close collaboration with sales managers and support staff is crucial in helping them to open an account.
-What is the biggest change in the investment sector in recent years and what are the prevailing trends?
The CFD market has seen tremendous growth in recent times, with daily transactions reaching trillions of dollars. As a result, multiple regulatory bodies globally have enacted stricter regulations and operating frameworks for investment companies. In my opinion, this move is rightly aimed at ensuring stability and security in the market.
Contrary to expectations, the growth of the CFD market has not been significantly impacted despite the imposition of stricter regulations. The investment community remains keen on this investment category, and companies have adapted to meet the stringent criteria.
I am confident that the trend will continue to favor TopFX's line of business, as the technology and multiple tools offered cater to needs that conventional products fall short of fulfilling.
We observe a consistent demand for algorithmic systems, robotic systems, and even artificial intelligence systems, which our platform provides the ability to connect with. From individuals to institutional investors, there is a continuous demand for risk management tools and more. In my opinion, investment firms that stick to conventional methods and disregard the advancements in technology and its tools will suffer significant market losses and face uncertainties about their future.
At TopFX, we stay ahead of the curve by closely monitoring market trends. In a highly competitive landscape, our commitment to reliability, strict compliance with regulations, and provision of top-notch trading terms sets us apart and keeps us at the forefront of the industry.
- Which investment product attracts the most interest?
The euro-dollar pair is and has always been the "king" of CFDs. Its high volatility, affordable trading cost, and deep market liquidity make it a popular choice among investors. Additionally, the ease with which investors can access relevant economic data, events, and policies that impact the value of these two currencies further adds to its appeal.
- What are your future focus areas?
Our objective is to expand our reach in recently explored markets, such as Greece and other European nations. Although we are pleased with our products, we aim to enhance the account opening and deposit processes and refresh our online presence.
We will maintain our presence at international trade shows. In 2022, we participated in over 10 conferences across various countries. Additionally, we successfully organized corporate events, including some in Greece where we showcased our brand, connected with investors and had insightful discussions on the progression of the markets.
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