The Ring Fenced amount is an amount of money that we reserve when you place your trades. We do this to cover for possible Trade Fee and/or Financing Fee to make sure that your account will never drop into a negative status. This is only temporary and once you've closed all your positions, the Ring Fenced Amount will be available again for you to withdraw.
The amount that we reserve is always 5% of the invested amount plus the Cash (the minimum Ring Fenced amount is £5). If all your positions are closed you will still see that amount in the app as ring fenced (reserved), however, it is available for withdrawals.
To explain the Ring Fenced amount in more detail, we would like to give you an example:
Say, you deposit £100 in your BUX account. The moment you make a trade, your Ring Fenced amount will be (5% of 100) £5.
If you invest £70 and the value of your investment grows to £80, your Ring Fenced amount will stay the same. However, once you close your investment, your total account value would increase by £10, taking your account value to £110. This means that if you now make a new trade, your Ring Fenced amount will be 5% of 110, which is £5.50.
As mentioned before, the Ring Fenced amount is only applicable when you are investing. The moment you want to use this money for a withdrawal, you can close all your positions, and withdraw this money.
If you have any further questions in regards to this, please feel free to contact us via email at BUX Support.