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Risk Disclosure Statement

Important information about the risks associated with AI-powered trading

Effective Date: January 1, 2025
Last Updated: January 15, 2025

IMPORTANT RISK WARNING

Trading in financial markets involves substantial risk of loss. Past performance does not guarantee future results. You should carefully consider whether trading is suitable for you based on your experience, objectives, financial resources, and other relevant circumstances.

1. General Investment Risks

All investments carry risk, and you should be prepared for the possibility of losing some or all of your invested capital. The following risks apply to all trading activities, whether manual or automated:

Market Risk

The value of investments can go down as well as up due to market conditions, economic factors, and other external influences beyond our control.

Currency Risk

If you trade in foreign markets or currencies, fluctuations in exchange rates may affect the value of your investments.

Liquidity Risk

Some investments may be difficult to sell quickly at a fair price, especially during volatile market conditions.

Interest Rate Risk

Changes in interest rates can affect the value of your investments, particularly bonds and dividend-paying stocks.

2. AI and Algorithmic Trading Risks

Bitlax Smart AI's automated trading system introduces additional risks that you should understand:

2.1 Technology Risks

Algorithm Performance

AI algorithms are based on historical data and mathematical models. Market conditions can change rapidly, and algorithms may not adapt quickly enough to new patterns or unprecedented events.

Example Scenario:

During the COVID-19 pandemic, market behavior became highly unpredictable. AI systems trained on pre-pandemic data experienced significant losses as they couldn't anticipate the unprecedented market volatility and government interventions.

System Failures

Technical failures, including internet connectivity issues, server downtime, or software bugs, may prevent trades from being executed or cause unintended trades.

Execution Delays

Network latency or system overload may cause delays in trade execution, potentially resulting in unfavorable prices.

2.2 Model Limitations

Data Dependency

AI models are only as good as the data they're trained on. Incomplete, inaccurate, or biased data can lead to poor trading decisions.

Overfitting

AI models may perform excellently on historical data but fail to generalize to new market conditions, a phenomenon known as overfitting.

Black Box Nature

AI algorithms can be complex and difficult to interpret, making it challenging to understand why certain trading decisions are made.

3. Specific Risk Factors

3.1 High-Frequency Trading Risks

Our AI system may execute numerous trades in short time periods, which can amplify both gains and losses:

3.2 Leverage and Margin Risks

LEVERAGE WARNING

Trading on margin or using leverage can magnify both profits and losses. You may lose more than your initial investment.

If your trading strategy involves leverage:

Leverage Example:

With 10:1 leverage, a 5% market decline results in a 50% loss of your invested capital. A 10% market decline would result in a 100% loss, potentially triggering a margin call.

3.3 Regulatory and Legal Risks

4. Past Performance Disclaimer

IMPORTANT: Any performance figures, backtesting results, or historical returns presented by Bitlax Smart AI are for informational purposes only and do not guarantee future results. Past performance is not indicative of future performance.

Factors that may cause future performance to differ from past results include:

5. Risk Management Measures

While we cannot eliminate risks, Bitlax Smart AI implements several risk management features:

5.1 Built-in Safeguards

5.2 User Controls

6. Recommendations for Users

To help manage your risk exposure, we recommend:

6.1 Before You Start

6.2 Ongoing Monitoring

6.3 Exit Strategy

7. Regulatory Compliance

Bitlax Smart AI operates in compliance with Australian financial regulations, including:

However, regulatory requirements may change, and new regulations specific to AI trading may be introduced.

8. Insurance and Compensation

While Bitlax Smart AI maintains professional liability insurance and follows industry best practices, please note:

9. Conflicts of Interest

Bitlax Smart AI may have conflicts of interest that could affect your investments:

We are committed to managing these conflicts fairly and transparently in accordance with regulatory requirements.

10. Communication and Updates

We will communicate important risk-related information through:

11. Your Responsibilities

By using Bitlax Smart AI's services, you acknowledge that you:

ACKNOWLEDGMENT REQUIRED

Before using our services, you must acknowledge that you have read, understood, and accepted all the risks outlined in this disclosure statement.

Questions About Risk?

If you have questions about any of the risks described in this document, please contact our risk management team:

Email: [email protected]

Phone: +61 (412) 345 678

Address: 17 and 20, 17/31 Queen St, Melbourne VIC 3000, Australia

Investment Advice: For personalized investment advice, please consult with a qualified financial advisor who can assess your individual circumstances and risk tolerance.