Retail clients will be permitted to continue trading in futures if their trading activities are intended to hedge against real economy price risks. These clients must then give their investment firm advance confirmation that the futures are for hedging. Hedging opportunities are particularly important for agricultural companies, but also for other companies operating in the real economy.

Furthermore, futures trading will continue to be possible for retail clients if their investment firm contractually rules out any additional payment obligation and investors thus cannot lose more than the amount invested. The general administrative act also includes a transitional provision: BaFin’s measure will not apply to futures contracts intended to settle or close positions opened before the administrative act has entered into force.

BaFin prohibits the additional payment obligation where retail clients trade in futures for non-hedging purposes, since such trading may be associated with unlimited financial risks. This is also a response to the increasing number of mini and micro futures products coming onto the market, which – owing to their small contract size and corresponding low entry threshold – are specifically aimed at this customer group. By taking this product intervention measure, BaFin will ensure that the losses incurred by retail clients in futures trading will be limited to the amount invested.

BaFin can restrict or prohibit the marketing, distribution and sale of financial instruments if there are major investor protection concerns (Article 42 of the Markets in Financial Instruments Regulation – MiFIR).