The European Securities and Markets Authority reports that over 10 million EU retail investors traded derivatives or structured products from 2022 to 2025, representing 2.6% of the adult population and 18% of active retail investors. Contracts for difference dominated transaction volumes at 35% of complex-product trades, followed by turbo certificates at 18%, options at 13%, and structured products at 8%.
ESMA observed rising turbo certificate activity without corresponding CFD growth, suggesting traders may be substituting turbos for CFDs given their similar leverage and risk profiles. This shift comes after EU regulators imposed leverage limits and risk warnings on retail CFDs in 2018. While the Netherlands has extended equivalent leverage limits to turbos, Germany has implemented alternative measures including mandatory risk warnings and client knowledge assessments for turbo trading, following BaFin analysis of 543,000 investors and 113 million transactions.
FXnCO Insight
Brokers should monitor regulatory convergence between CFDs and turbo certificates as authorities close loopholes that allow traders to bypass retail investor protections through product substitution.
Source: Finance Magnates