Forex Brokers by Regulation
Because the Forex market is a decentralized market without a regulated exchange Forex Brokers need to be regulated by governmental supervisory bodies. As such, Forex brokers are required, before they start operating, to apply and register with the country's regulatory authority that they run their operations.
Dealing with a regulated Forex Broker means that you expect a certain level of quality control as there are regular audits, reviews and evaluations that are forced to be maintained by the Forex Brokers. You can also argue that if the regulation was set up before the Forex market was evolved there wouldn't be so many clients or investors losing their money on Ponzi schemes and misrepresentations.
How to Check If a Forex Broker Has a License?
There are several ways to determine whether a forex broker is licensed and trustworthy. Licensed forex brokers usually carry a seal of approval from a regulatory agency at the bottom of their sites and display the ID numbers of their licenses. But do not trust the information on the company's website blindly.
Every regulatory agency has an official website and a database, allowing investors to check whether the forex broker's license is valid. Traders are also advised to check if the broker's contact details listed on the website match with the ones listed on the regulatory agency's website.
Furthermore, select a forex broker with a physical office in the country of your residence. Note that some forex brokers benefit from the regulatory differences between the markets to bypass the unfavourable regulations. This practice is also known as regulatory arbitrage.
For example, a forex broker may have a license from a strict regulatory agency and establish a separate company under the same brand licensed by an offshore regulatory agency. Therefore, make sure to set up an account under the jurisdiction you want.
For getting latest forex broker selection tips and forex news strategies, join this forex trading forum.
Regulated vs unregulated brokers
Why is it so important for an online broker to be financially regulated by one or more regulatory bodies? Because we are talking about the safety of your capital, the money you invest and the promise of the broker to use your funds solely for the right purpose. When a broker is unregulated, this means that there is no regulatory organization or group of persons monitoring them, in other words, they can take your money and disappear. This is the reason why you see lists of online brokers described as scams or frauds. The first thing you need to do while checking out online brokers is to verify whether they are regulated or not. For example, forum.forex is a trustworthy online forex trading forum for best brokers recommendation from experts, an excellent choice for both novice and experienced traders. Their transparency and the amount of legal documentation they put at your disposal is a sign of professionalism and a feature that any legit online broker should have.
Why Would Anyone Trade with an Unregulated Forex Broker? Are Unregulated Brokers Scams?
The answer is that the regulation of forex activity has increased across the globe in recent years. In Europe, Asia and Australia, leverage on forex & CFDs has been reduced by local regulatory bodies making forex trading less attractive for those investors who have grown accustomed to higher leverage.
As such, some traders seeking leverage greater than 30:1 accept the risk of trading with an unregulated forex broker in exchange for greater account flexibility. Additionally, unregulated brokers often are able to offer deposit / "no deposit" bonuses along with other promotions and giveaways that are now illegal in many parts of the world. Consider some of these reasons when you are asking yourself why someone would trade with an unregulated forex broker.
Conclusion
In the end, the rate of success stands only in your hands and the decisions you make belong only to you. There will always be good and bad in this world and the forex trading market is no exception. Knowledge is power and once you will be able to identify your needs and choose the right online forex broker for you, success and profit will eventually come.
You can learn more about forex trading and forex brokers recommendation at forum.forex
This is the forex forum for beginners and professional currency market traders. Discuss and share forex trading tactics, currency pairs, tips and forex market data. Analyze forex brokers, leverage and signals providers.
Thank you
Because the Forex market is a decentralized market without a regulated exchange Forex Brokers need to be regulated by governmental supervisory bodies. As such, Forex brokers are required, before they start operating, to apply and register with the country's regulatory authority that they run their operations.
Dealing with a regulated Forex Broker means that you expect a certain level of quality control as there are regular audits, reviews and evaluations that are forced to be maintained by the Forex Brokers. You can also argue that if the regulation was set up before the Forex market was evolved there wouldn't be so many clients or investors losing their money on Ponzi schemes and misrepresentations.
How to Check If a Forex Broker Has a License?
There are several ways to determine whether a forex broker is licensed and trustworthy. Licensed forex brokers usually carry a seal of approval from a regulatory agency at the bottom of their sites and display the ID numbers of their licenses. But do not trust the information on the company's website blindly.
Every regulatory agency has an official website and a database, allowing investors to check whether the forex broker's license is valid. Traders are also advised to check if the broker's contact details listed on the website match with the ones listed on the regulatory agency's website.
Furthermore, select a forex broker with a physical office in the country of your residence. Note that some forex brokers benefit from the regulatory differences between the markets to bypass the unfavourable regulations. This practice is also known as regulatory arbitrage.
For example, a forex broker may have a license from a strict regulatory agency and establish a separate company under the same brand licensed by an offshore regulatory agency. Therefore, make sure to set up an account under the jurisdiction you want.
For getting latest forex broker selection tips and forex news strategies, join this forex trading forum.
Regulated vs unregulated brokers
Why is it so important for an online broker to be financially regulated by one or more regulatory bodies? Because we are talking about the safety of your capital, the money you invest and the promise of the broker to use your funds solely for the right purpose. When a broker is unregulated, this means that there is no regulatory organization or group of persons monitoring them, in other words, they can take your money and disappear. This is the reason why you see lists of online brokers described as scams or frauds. The first thing you need to do while checking out online brokers is to verify whether they are regulated or not. For example, forum.forex is a trustworthy online forex trading forum for best brokers recommendation from experts, an excellent choice for both novice and experienced traders. Their transparency and the amount of legal documentation they put at your disposal is a sign of professionalism and a feature that any legit online broker should have.
Why Would Anyone Trade with an Unregulated Forex Broker? Are Unregulated Brokers Scams?
The answer is that the regulation of forex activity has increased across the globe in recent years. In Europe, Asia and Australia, leverage on forex & CFDs has been reduced by local regulatory bodies making forex trading less attractive for those investors who have grown accustomed to higher leverage.
As such, some traders seeking leverage greater than 30:1 accept the risk of trading with an unregulated forex broker in exchange for greater account flexibility. Additionally, unregulated brokers often are able to offer deposit / "no deposit" bonuses along with other promotions and giveaways that are now illegal in many parts of the world. Consider some of these reasons when you are asking yourself why someone would trade with an unregulated forex broker.
Conclusion
In the end, the rate of success stands only in your hands and the decisions you make belong only to you. There will always be good and bad in this world and the forex trading market is no exception. Knowledge is power and once you will be able to identify your needs and choose the right online forex broker for you, success and profit will eventually come.
You can learn more about forex trading and forex brokers recommendation at forum.forex
This is the forex forum for beginners and professional currency market traders. Discuss and share forex trading tactics, currency pairs, tips and forex market data. Analyze forex brokers, leverage and signals providers.
Thank you