Negative balance protection

COBS 22.5.17 says the liability of a retail client for all restricted speculative investments connected to the account is limited to the funds in that account. The guidance says the client cannot lose more than the funds specifically dedicated to trading those products. For this rule, funds are the cash in the account plus unrealised net profits on open positions. Other assets in the account are ignored. The protection is for retail clients and for those products. It is not a statement about a professional-client account. ASIC's CFD order separately limits a retail client's CFD losses to the funds in the CFD trading account. ESMA's 2018 temporary measures included the same idea on a per-account basis. The protection does not stop a loss of the funds that were in the account.