Executing trades with borrowed capital isn’t new. Margin trades – borrowing money from your broker to pay for stocks – became popular in the railroading days, back in the 1800s. And leveraged trades – where you use your existing portfolio as collateral for borrowing a sum to reinvest – have also been with us a long time. Simply taking out a loan is another option available to investors.
But margin trades suffer from so-called margin calls, ie, when the value of the stock purchased with borrowed funds goes below a certain level, then the broker has the right to demand at least some of his or her money back. This ruins the purpose of a margin trade because, if the trader had been liquid in the first place, they wouldn’t need to borrow.
In the case of leveraging, one borrows against portfolio capital such as owned stocks, and if those stocks suddenly plunge in value, one’s borrowing base is totalled and creditors come knocking to collect.
As for debts, they suffer from the usual drawbacks of loans – interest being the worst of them.
What OVEX offers is entirely unique and entirely different, available only to its OTC customers.
Once again, OVEX has disrupted the entire playing field, just as it did with its ground-breaking request for quote (RFQ) tool that turned traditional trading on its head and made it possible for novice crypto-traders to simply walk in and buy some crypto.
Unlike margin trading, leveraged trades or straight debts, OVEX now offers a clean credit line of over R100 million to large volume clients wanting to trade crypto assets against ZAR.
This credit line ensures OTC clients can accomplish immediate trade execution with delayed settlement. Essentially, the credit line is a simple “trade now and deposit the funds later” methodology for trusted clients so that they never miss out on an opportunity.
So far, this exclusive feature has proven popular among OVEX users as investors navigate volatility in the wake of the pandemic. Often, timing is everything, and with this revolutionary new credit line, OVEX users can bank on every second.
High inflation, geopolitical unrest, supply chain crises and hawkish monetary policies have led to the depression of growth assets across the board. Things move quickly in crypto and the way to stay afloat is to move even quicker. The R100 million credit line does just that, allowing large-volume investors to act instantly while they pull the necessary funds out of old hiding places. OTC clients can thus hedge against volatility. You can apply for access to the exclusive OTC desk here.
The ethos behind such a service
That OVEX would offer such a service to large-volume traders is no surprise at all. Its high-interest-earning accounts alone now near R1 billion in managed funds. And its automated API, which is accessed by third parties trades a staggering R3 billion a month. In short, the digital asset prime broker boasts the deepest liquidity of any other provider in South Africa enabling the exchange to open up large credit lines for its exclusive clients.
But it’s not all about liquidity; it’s about the company’s overall ethos. OVEX has built something of a name for itself as an exchange that offers a more personalised, white-glove service to large-volume traders, brokers and high-end asset managers. That, coupled with its proprietary cutting-edge technology and programming that powers the South African exchange means that OVEX can do incredible things such as offer prices that are a minimum of 3% more competitive than local SA exchanges for orders over R1 million – or offer R100 million in credit.
As a retail trader or crypto-newbie – you may feel like these revolutionary features are reserved for the pros only. Quite the opposite. Retail investors can take advantage of OVEX’s exclusive institutional grade liquidity through the exchanges intuitive Buy/Sell trading tool. Here retail investors can trade over 60 different pairs and with zero trading fees. All at the simple click of a button. With OVEX, you don’t have to be a pro to trade like one.
Share