How did we choose our best forex brokers in South Africa?
The most important factor for the Trading Brokers team to consider when choosing the best South African forex brokers was that the brokers are regulated in South Africa by the Financial Sector Conduct Authority (FSCA). Once the brokers regulation had been confirmed, we then researched and analysed the forex trading services that they provide in great detail and assigned them with an unbiased broker rating based on our findings. During this research, we gave great consideration to what we deem to be amongst the most important factors to consider when choosing an online forex trading broker, including:
- Regulation: A forex broker in South Africa should be regulated by the Financial Sector Conduct Authority (FSCA).
- Forex Trading Platforms: The forex broker must offer a range of the best trading platforms that are user friendly, intuitive and compatible across multiple desktop, web and mobile devices.
- Forex Trading Instruments: They should have a large selection of minor, major and exotic currency pairs for trading.
- Spreads: The forex brokers spreads on currency pairs should be competitive and as low as possible.
- Commission: The commission charged for trading forex currencies should be competitive, the lower the better.
- Fees: Any additional fees such as accounting, inactivity, etc, should be made clear to traders from the get go.
- Execution Speeds: The best forex brokers should have reliable trade execution speeds with minimal slippage.
- Liquidity Providers: Ideally, the forex broker will have a vast pool of liquidity providers (LPs) in order to deliver consistent execution speeds and tight spreads.
- Forex Trading Tools: The forex broker should provide a vast array of trading tools for analysing charts, planning and managing trades, trading signals, social trading, etc.
- Forex Educational Resources: Most new traders will need a selection of educational materials on different trading topics to help them improve their trading skills and knowledge. Training tools can include video tutorials, trading guides, webinars, etc.
- Forex Account Types: There should be flexible account options to suit different trading styles and budgets.
- Forex Account Funding Options: The forex broker should offer a choice of convenient account deposit and withdrawal methods.
- Customer Support: The forex brokerage should have a prompt, polite and knowledgeable customer support team on hand to answer traders general and technical questions.
South African forex broker regulation
Forex trading is the speculating on the price of one currency against another currency, commonly known within the trading community as a currency pair. Online forex trading has increased in popularity over the years with many online brokerages opening which has given traders a vast choice of brokers who are all competing for their business. This can make it difficult to choose the best forex brokers in South Africa.
We believe that it is of upmost importance that a forex broker providing services to traders in South Africa is authorised and regulated by the Financial Sector Conduct Authority (FSCA). Using a regulated broker helps to give traders peace of mind that they are using a brokerage firm which is subject to strict rules and regulations put in place to help protect investors. It is worth mentioning that there are some non-South African forex brokers that still solicit clients located within South Africa. There are also South African forex brokers who offer online forex trading services to clients located in some countries outside of the South Africa. In this instance, it would be a considered a wise idea to ensure that the broker has the relevant regulation within the jurisdiction that they are operating from.
Financial Sector Conduct Authority (FSCA)
The Financial Sector Conduct Authority (FSCA) is the market conduct regulator, responsible for the regulation of financial institutions in South Africa that provide financial products and financial services, financial institutions that are licensed in terms of a financial sector law, including banks, insurers, retirement funds and administrators, and market infrastructures.
The FSCA aims to enhance and support the efficiency and integrity of financial markets and to protect financial customers by promoting their fair treatment by financial institutions, as well as providing financial customers with financial education. They aim to ensure there is an efficient and stable financial sector where customers are informed, protected and treated fairly.
Verifying the regulation of forex brokers in South Africa
If a forex broker has been licensed by FSCA, they should be provided with a registration number as proof that they are registered. This number is usually located on the brokers website, near the footer where they state who they are regulated by. You should check on the FSCA website to validate the current status of the broker registration to ensure that it is valid and up to date. It has been known for some scam brokers to fake regulation, some even going as far to clone another brokers website. When you are looking up the registration number, you should find details of the FSCA regulated brokerage firm including their website, contact details and if they have any cases brought against them.