Forex Brokers in China

Category: Countries | Author: Trading Brokers | Date: November 24, 2022

Forex trading in China is popular amongst residents who are looking to buy and sell currencies to speculate on the fluctuating currency market prices. Whilst international forex brokers can accept traders in China as clients, forex brokers in China are required to become authorised by the State Administration of Foreign Exchange (SAFE). The State Administration of Foreign Exchange (SAFE) is the national regulatory agency that oversees activities in China’s foreign exchange market.  SAFE functions as an official state-run bureau and forms part of the country’s central bank.

Best forex brokers China

To find the best forex brokers in China, we created a list of all the forex brokers that accept clients in China and then ranked them based on our overall rating. You can see our list of our top forex brokers for China below.

Broker
Rating
Regulated
Min. Deposit
Founded
Max. Leverage
1.

ADGM FRSA, ASIC, BVIFSC, CBI, FFAJ, FSCA, IIROC, JFSA

$100

2006

1:400

Between 74-89% of retail investor accounts lose money when trading CFDs with this provider.
2.

ASIC, BaFin, CFTC, DFSA, FCA, FINMA, FMA, FSA, FSCA, JFSA, MAFF, MAS, METI, NFA

$250

1974

1:200

71% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money.
3.

ASIC, BaFin, CMA, CySEC, DFSA, FCA, SCB

$200

2010

1:400

Between 74-89% of retail investor accounts lose money when trading CFDs with this provider.
4.

ASIC, CySEC, DFSA, IFSC

$5

2009

1:888

Between 74-89% of retail investor accounts lose money when trading CFDs with this provider.
5.

ASIC, CySEC, FSA, SCB

$200

2007

1:500

Between 74-89% of retail investor accounts lose money when trading CFDs with this provider.

SAFE forex brokers in China

Chinese nationals can legally trade Forex despite the stricter stance their government has adopted. Retail customers can trade currency pairs, stocks, and other financial instruments although there are limits on the amounts one can buy annually.

Although China does not issue licenses to forex brokers, and leveraged services are deemed illegal, there are plenty of offshore regulated brokers that you can trade with. In general, the Chinese Ministry of Public Security and the State Administration of Foreign Exchange (SAFE) allows forex brokers which are regulated by respected global authorities, such as the FCA, ASIC and CySEC, to offer their services to Chinese clients.

These brokers must include the use of the Chinese language in their platforms; they must also provide the necessary local payment options and customer support for Chinese traders.

In 2021, China’s State Administration of Foreign Exchange (SAFE) issued the “Guidelines on Foreign Exchange Trading Conduct”. The Guidelines applies to the interbank market as well as the client market, and all the parties engaged in the foreign exchange market, including institutions engaged in foreign exchange transactions, China Foreign Exchange Trade System, Shanghai Clearing House, currency brokers, etc.

How to verify SAFE regulated brokers in China

The demand for the low-key Chinese retail Forex Trading market is so huge that it prompted many established international brokerage brands to expand their operations in mainland China.

Since forex trading is getting more popular in China, many international forex brokers are trying to attract Chinese traders with a dedicated website translated into Chinese and more accessible funding methods. This creates a great opportunity for Chinese traders who can now use some of the leading forex brokers in the world and benefit from top class forex trading conditions.

You can find an authorised broker’s license number from the disclosure text at the bottom of their homepage. You can then look up the authorisation number on the regulator website to confirm if the forex broker is regulated in China to provide online forex trading products and services.

Some China forex brokers are regulated in more than one jurisdiction so that they can offer a different range of trading accounts and conditions depending on the location of the trader and regulated entity that they choose to open a forex trading account with.

Is forex trading legal in China?

Due to China’s distinct business environment and regulatory framework, foreign brokerages have not always found it simple to enter the Chinese forex market. It is lawful to trade currencies against one another here, but China’s closed-capital policy makes it difficult.

This limits the free movement of money into and out of the nation unless it is done so in accordance with strict regulations. The State Administration of Foreign Exchange and the People’s Bank of China, the nation’s central bank, are the two principal regulatory entities in charge of policing the foreign exchange market in China (PBOC).

By collaborating with local foreign exchange firms, which act as introduction brokers, non-domestic brokerages can enter the local forex market and establish a network of dependable clients.

Before contacting a Chinese introduction broker (IB), foreign brokerages must first be organized in a specific way in order for the Chinese government to effectively monitor their operations.

If they have established China-owned offices on the country’s mainland, foreign enterprises governed by reputable financial watchdogs like the UK Financial Conduct Authority (FCA) or the Australian Securities and Investments Commission (ASIC) are protected against cancellation by the local authorities.

The majority of reputable brokerages that have opened operations in mainland China have done so either through direct ownership or collaborations with 100 percent Chinese-owned businesses. Due to this, overseas Forex brokers are able to operate on Chinese infrastructure, which gives the local government the ability to closely monitor all of their online operations.

These restrictions allow the Chinese government to monitor the order flow, trade execution, and money storage of the brokerages. The Chinese government closely monitors all activity, from deposits and market execution to withdrawals and interactions with customer service.

Companies with little to no infrastructure in mainland China and no physical presence there are likely to lose business. Because it is impossible for the government to sufficiently monitor them and establish whether they provide Chinese clients with good service or not, they run the risk of having their websites shut. Due to complaints from lost investors, local authorities had shut down over 600 illegal margin-trading platforms by the end of 2018.

Importantly, although there are annual purchase limits, retail clients within the nation are allowed to trade Forex currencies. Trading on margin is not permitted in China by law.

One can trade using funds provided by third parties using this strategy, providing them access to more cash through leverage. For instance, $10,000 in one’s own money would be required to start a $100,000 position with a 10:1 leverage ratio. This in turn has the potential to significantly increase both the traders’ gains and losses.


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