(1) Price Fluctuation Risk

Fluctuations in prices of equity indices or prices of ETFs related to gold or crude oil may cause a loss. Since the transaction amount is much larger than the deposited exchange margin, these fluctuations may cause a loss exceeding the deposited exchange margin, depending on market conditions. Click kabu 365 prices also do not reflect the actual prices of equity index or ETF. The difference in these two prices can expand due to factors such as supply and demand balance and market conditions. Therefore, investors may incur losses when they are unable to trade contracts at prices they expect based on actual prices of equity index or ETF.

(2) Credit Risk

TFX has introduced the clearing system under which it acts as a counterparty to a TFX Trading Member in Click Kabu 365 and TFX segregates all exchange margins deposited by Customer; therefore, all deposited margins are in principle protected. Provided, however, that non-payments by a TFX Trading Member etc., due to changes in credit status or bankruptcy by a TFX Trading Member etc., may cause delays in completing refund procedures or unexpected loss.

(3) System Failure Risk

If a failure occurs in the system of TFX or a TFX Trading Member, or network system among Customers, TFX Trading Members and TFX, delivery of market information, etc, placement of order or execution thereof may be delayed or become impossible, and as a result, an unexpected loss may be caused.

(4) Risks of changes in tax systems, laws, etc.

Changes in tax systems, laws or their future interpretation may cause unfavorable results.

(5) Interest Rate Fluctuation Risk

Fluctuations in the interest rate of Japanese currency or foreign currency in relation to Click Kabu 365 may decrease the interest of Click Kabu 365 to be received, or increase the same to be paid.

(6) Liquidity Risk

Click kabu 365 introduced the Market-Making Method for Exchange FX Margin contracts, in which Market Maker offers ask and bid prices at which Customers may execute a transaction. It may become difficult or impossible for Market Maker to provide the ask and bid prices in a stable and sustainable manner, depending on certain conditions such as acts of God, war, political change, change in legislative, in foreign exchange policies or laws and rules of the relevant country, system changes at the exchanges on which the issues that comprise the relevant equity indices are listed, restrictions on trading of futures contracts whose underlying assets are relevant equity indices, change in policies or in laws and rules on commodity market, etc. of the relevant country, system changes or restrictions on trading at the exchanges on which ETFs are listed, restrictions on trading of commodity futures contracts related to ETFs, delay or suspension in the distribution of information, or sharp fluctuations in the currency market, etc., and as a result, Customers may not be able to trade at expected prices and suffer an unexpected loss therefrom.
In addition, even under normal conditions, transactions in the equity indices or ETFs with lower liquidity may cause a loss to Customer due to causes such that Customer is not able to execute a transaction at the desired price.

(7) Foreign exchange risk

When trading overseas equity index margin contracts, Equity Index Margin Customer does not carry foreign exchange risks. However, Equity Index Market Maker takes into account foreign exchange risks when providing bids and offers and as a result, the spreads may become large in accordance with the foreign exchange market conditions and Equity Index Margin Customer may not be able to trade at prices they expect and subsequently incur an unexpected loss.

(8) Risks related to forecast of dividends

TFX calculates the dividend amount as the theoretical amount that will impact the equity index in the future based on the forecast of dividends as of the last cum-rights date. The amount equivalent to the dividends calculated by TFX is resultantly different from that calculated based on actual dividend payments, or forecast of dividends or actual dividends for the actual shares that comprise the index.