CySEC Regulated Forex Brokers
Trading forex with a CySEC regulated broker can give you some protection if things were to go wrong. Not only that, you can focus on your trading knowing that the broker must follow a strict set of rules and procedures that have been put in place to protect investors such as yourself. Compare this to offshore brokers where you might not have anywhere to go if things were to turn sour, it is easy to see why so many traders opt to open an account with CySEC regulated forex brokers.
What is the CySEC?
The Cyprus Securities and Exchange Commission (CySEC) is the independent public authority responsible for the supervision of the investment services market, the collective investment and asset management sector, and the crypto-asset activities conducted in and out of the Republic of Cyprus.
Along with the FCA, the CySEC are one of the more respected financial regulatory agencies in Europe. They are a modern and well-funded organization and often the first to make regulatory changes needed to protect traders and help to maintain fairness within the CFD industry.
What does the CySEC do?
The CySEC regulator monitors brokerage companies’ actions and transactions to ensure that they comply with the directives of the legal and regulatory framework. CySEC licenses are distributed to allow investment and brokerage firms to operate in the stock, forex, and CFD market.
What is an CySEC regulated forex broker?
Since 2004, Cyprus is a member of the European Union, which allows the company that obtained brokerage license in Cyprus to carry out passportization (activities in the territory of the Member State of the EU after notification) of its services in the EU, as well as Iceland, Norway and Liechtenstein.
How do I check if a forex broker is regulated by CySEC?
Every company that is subject to regulation by the Cyprus Securities and Exchange Commission (CySEC) is referred to as a Cyprus Investment Firm (CIF). These companies are required to have the relevant license which you can look up on the CySEC register to confirm.
The European Securities and Markets Authority (ESMA) licensing rules, which must be implemented by all brokers in Europe, state that the license information must be shown prominently on the main page of the financial trading provider’s website.
Cyprus, due to its attractive tax regime, coupled with its EU Member status, its implementation of the Markets in Financial Instruments Directive (‘MiFid’), and regulatory regime has proved to be a popular jurisdiction for the incorporation and operation of FX companies. That means that you will not be short of choice when looking for a CySEC regulated forex broker.
What is MiFID II?
In layman terms, MiFID II is an EU regulatory framework designed to regulate financial markets and improve protections for investors. MiFID II aims to standardise practices throughout the EU and brings a larger number of firms under the supervision of an EU financial regulator.
Who are the best CySEC regulated forex brokers?
Aside from being a regulated broker, there are other things that you need to consider when making your choice. This includes minimum deposit, leverage, spreads, fees, platforms, apps, education, tools, funding and customer support. You can see a selection of our best CySEC forex brokers in the table below.
CySEC forex brokers pros & cons
- Provides protection to traders and investors
- Broker must operate in an honest and transparent manner
- Plenty of CySEC regulated brokers to choose from
- Restriction on some trading products and services
- Cannot accept traders from some jurisdictions
- Not all forex brokers are CySEC regulated
Conclusion: should I use an CySEC regulated forex broker?
If you are an EU trader, then you can consider a CySEC regulated forex broker because CySEC can guarantee protection and safety for investors and traders alike. The regulator monitors brokerage companies’ actions and transactions to ensure that they comply with the directives of the legal and regulatory framework.
If the broker does not fulfil what it promises and you have any issues, you are able to raise the issue with the regulator. Hopefully it should not come that, but having protection from a regulator in place can is certainly beneficial.
You will find that some of the best forex brokers are regulated by more than one regulator. This not only gives traders in different jurisdictions protection, but can also enable CySEC brokers to provide different trading products and serviced under another license.
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