Not upheld: Investment mis-selling complaint against Trading 212 UK Limited

Decision detail

Summary

Mr B complained that Trading 212 UK Limited inappropriately closed two of his CFD positions in Natural gas-24Jun25 on 16 June 2025, resulting in approximately £12,000 in losses. Mr B maintained a 26% margin level throughout the trading day despite significant price fluctuations, but his positions were closed immediately upon market reopening when his margin dropped to 24.20%, below the 25% maintenance threshold. Mr B argued the price movement at market open was minimal compared to intraday volatility and that he could not manage his positions at that time. The ombudsman found that Trading 212 acted in accordance with FCA regulatory obligations by closing positions as soon as market conditions allowed after the margin fell below the required threshold, and that Mr B's narrow 1% margin buffer above the close-out level left his account vulnerable to closure at market open when futures-based instruments typically experience sharper price movements. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman found that Mr B's account fell below the required 25% maintenance margin threshold when the market reopened, triggering T212's automatic close-out mechanism in accordance with FCA regulatory obligations. Although Mr B maintained a 26% margin during the trading day, his narrow 1% buffer above the close-out threshold left minimal headroom for the natural volatility of leveraged CFD positions, particularly at market reopening when futures-based instruments experience sharper price movements due to trading pauses and overnight developments. The ombudsman noted that even small price movements can have disproportionately large effects on margin levels when leverage is involved, and that T212 acted as soon as market conditions allowed, which is required by FCA rules. The ombudsman rejected Mr B's concerns about the timing of the closure and the apparent small price movement, finding that the relevant question is whether the movement was sufficient to reduce equity below the required maintenance margin, not how it appeared visually on a chart.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website