Risk Disclosure

1. Purpose of this Disclosure

This Risk Disclosure describes the principal risks associated with the Services provided by OCTO FINANCIAL LTD (“OctoHex”). It forms part of the Terms of Service. It cannot list every risk, and new risks may arise. You should only use the Services if you fully understand these risks and can afford to lose the entire amount you allocate. If in doubt, seek independent professional advice.

2. No Guarantee and Possibility of Total Loss

There is no guarantee of profit and no fixed, minimum or target return. Results may range from losses to significant gains, and you may lose part or all of the capital allocated to a Package. You should not allocate funds that you need for living expenses, that you have borrowed or whose loss would materially affect your financial situation.

3. Risks of CFDs and Leverage

Trading is carried out through contracts for difference (CFDs), which are complex derivative instruments. You do not own the underlying crypto assets, indices, commodities, shares or ETFs and have no rights attached to them, such as voting rights or rights to a blockchain asset.

CFDs are typically traded on margin and with leverage. Leverage magnifies both gains and losses: a small adverse price movement may cause a disproportionately large loss of allocated capital. Positions may be closed automatically by the liquidity provider or the system where margin becomes insufficient, crystallising losses at unfavourable prices.

Both long (buy) and short (sell) positions are used. Short positions can incur losses if prices rise, and theoretically losses on a short position are not limited by the price of the underlying.

4. Funding, Overnight and Trading Costs

CFD positions held overnight or over weekends are usually subject to funding, swap or overnight financing charges, which may be positive or negative and may change without notice. Spreads and financing costs are incurred within the System on every trade, irrespective of whether a day is profitable, and are reflected in the daily net result of the System; they may materially reduce results, particularly for high-frequency strategies. OctoHex does not charge per-lot commissions, but on profitable days it retains a fee from the day’s net profit according to the size tier of your Package, while losses on losing days are passed on to you in full. As a result, your net result over a period may be lower than the gross result of the System. Applicable tiers are shown in the client area.

5. Volatility of Crypto Assets

Crypto assets are extremely volatile and may experience rapid price movements of large magnitude within very short periods. Their prices may be affected by market sentiment, regulatory announcements, technological failures, forks, hacks of third-party platforms, the actions of large holders and limited market depth. Crypto markets trade continuously, so adverse movements may occur at any time, including when other markets are closed.

6. Automated, AI and Model Risk

Strategies are executed automatically by algorithms that use AI-assisted models. Models are based on assumptions and historical data that may not reflect future market conditions. They may misinterpret data, overfit to past patterns, behave unexpectedly in conditions not seen before, or fail to adapt to structural changes in markets.

Errors in code, data feeds, model parameters or configuration may cause unintended trades, oversized positions or the failure to close positions. Strategies within the System may be modified, paused, replaced or stopped automatically under OctoHex’s risk rules, which may affect results and crystallise losses. Such changes apply to all clients simultaneously. You will not be consulted before individual trades are executed or strategies are changed.

7. Limitations of Backtesting and Simulated Performance

Performance information shown on the Platform, including on the public performance page, may be historical, backtested or simulated. Simulated results are prepared with the benefit of hindsight, do not reflect actual trading, and may not fully account for slippage, liquidity, commissions, financing costs, execution latency or the impact of the strategy on the market. Live results frequently differ, sometimes substantially, from backtested results.

Past or simulated performance is not a reliable indicator of future results. Performance information is illustrative and is not an offer, promise or forecast.

8. Liquidity, Slippage, Gaps and Market Closures

Orders may be executed at prices different from those expected (slippage), particularly during periods of high volatility, low liquidity or major news events. Prices may “gap” from one level to another without trading at intermediate levels.

Many CFD underlying markets, such as indices, commodities, shares and ETFs, are closed overnight, at weekends and on public holidays. Positions held during closures are exposed to weekend and overnight gaps when markets re-open, and the system cannot close positions while a market is closed or halted. Liquidity providers may widen spreads, reduce available liquidity or suspend quoting at any time.

9. Stop-Loss Protection Limits

Stop-Loss Protection is an optional risk-management mechanism that seeks to close positions when account equity reaches a capital floor defined by you. It is not insurance, a guarantee or a capital-protection product in any regulated sense. Because of slippage, gaps, market closures, trading halts, liquidity events, technology failures and execution risk, positions may be closed at a level significantly below the floor, and losses may exceed the threshold you set. Where Stop-Loss Protection is disabled, no such mechanism applies to your Package.

10. Counterparty and Liquidity Provider Risk

CFD positions are hedged or executed with institutional liquidity providers and prime brokers. You are exposed to the risk that any such counterparty becomes insolvent, defaults, suffers operational failure, restricts access or is subject to regulatory action. In such an event positions may be closed at unfavourable prices, and funds held with that counterparty may be delayed, reduced or lost. You are also exposed to the credit risk of OctoHex itself.

11. Custody Risk of Crypto Deposits

Deposits are made in cryptocurrency through a third-party payment processor and may be held in wallets controlled by OctoHex or its service providers. Crypto assets held in custody are exposed to risks of hacking, theft, loss of private keys, operational error and insolvency of a custodian. Client crypto assets may not be protected by any deposit guarantee, investor compensation or insurance scheme. Transactions on a blockchain are irreversible: funds sent to a wrong address or network may be permanently lost. Stablecoins may lose their peg, and the value of non-stablecoin deposits fluctuates until conversion.

12. Technology and Cyber Risk

The Services depend on software, servers, internet connectivity, third-party APIs, market data feeds and blockchain networks. Outages, latency, cyber-attacks, data corruption or failures at OctoHex or its providers may prevent trades from being opened, managed or closed as intended, or may delay deposits and withdrawals. You are responsible for securing your own devices, email account and credentials.

13. Concentration and Correlation Risk

All Packages participate in one and the same OctoHex System, pro rata to the amounts invested. You cannot choose or exclude individual strategies, and losses of the System affect all clients at the same time. The System may concentrate exposure in a limited number of instruments, asset classes or directions. Combining several strategies does not necessarily provide diversification: strategies and markets may become highly correlated, especially during market stress, so that losses occur simultaneously across positions.

14. Liquidity of Your Investment

Packages have a fixed term (currently 24 months). Profit credited to a Package is locked and can be released to your cash balance only during profit withdrawal windows announced by OctoHex, which may be infrequent (for example, annually). Capital is generally not available for withdrawal during the term, and early termination is subject to conditions and charges under the Fee Schedule. You may therefore be unable to access your funds when you wish to, and the amount received on early termination may be lower than the capital allocated.

15. Regulatory and Legal Risk

The legal and regulatory treatment of CFDs, crypto assets and automated trading services varies between jurisdictions and is evolving. Changes in law, regulation, enforcement or the policies of liquidity providers and payment processors may restrict or prohibit the Services, require changes to strategies or products, or lead to the closure of accounts. Investor compensation schemes may not apply to the Services.

16. Tax

You are solely responsible for determining and paying any taxes arising from your deposits, trading results, distributions, withdrawals and partner earnings. Tax treatment depends on your individual circumstances and may change. OctoHex does not provide tax advice and may be required to report information to tax authorities.

17. No Advice and Your Responsibility

OctoHex does not provide investment, financial, legal or tax advice and does not assess whether a particular strategy is suitable for your personal circumstances unless required by applicable law. Statements by partners or third parties are not made on behalf of OctoHex. By accepting this Risk Disclosure you confirm that you understand the risks described above, that you are acting on your own judgement, and that you are able to bear the loss of all capital allocated to the Services.