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Forex trading in Canada is very advanced and provides some of the best protections to traders compared to all other major Forex trading hubs in the world. Hence, it is advisable to choose Canadian regulated Forex brokers over the oversees brokers option. These advantages place Canadian Forex traders at an advantage over other traders around the world, making the Forex industry in Canada very favorable. Despite the various advantages of trading the Forex market in Canada, one must nonetheless be very cautious about the Forex broker they choose to work with.
This is why you should still take a moment to carefully consider your option before making that first deposit. In this post, we are going to look at the most important aspects of a top Canadian FX broker every Canadian should consider in a Forex broker before making the final decision. A huge part of this decision shall depend on the regulatory framework and environment in the Canadian legislation since it is these that shall ensure fairness in the industry.
Apart from the legal factors, the rest shall be very particular, yet they are also very important. You see, choosing the best Canadian FX broker is very subjective, just like it is when shopping for groceries at a supermarket.
Some might prefer the skim milk while others will opt for the whole milk. The same is true with choosing a Forex broker since there are some specific factors that may appeal to one trader and not the other. Take spreads and commissions, for example, there are some traders who prefer to pay a one-time commission while another will prefer to pay for spreads.
Other factors include leverage, choice of trading instruments, etc. Such factors are also important, and we shall look at them too in detail. There are currently only a handful of Forex brokers based in Canada due to the regulations regarding retail Forex trading in the country. Canadians are allowed to trade with offshore Forex brokers without any risk of penalization.
As a result, many offshore Forex brokers choose not to set up shop in Canada or even acquire a license from the Canadian regulators. Nevertheless, the largest Forex brokers in Canada have made the move into Canada in order to better serve the Canadian residents, and these include:. The above are those Forex brokers who actually have a physical presence in Canada and are licensed by Canadian regulators.
However, just as we mentioned above, some traders will be interested in different options. For those traders, you can still find some great options from overseas to trade with. It is still advisable, though, to work with Canadian-based Forex brokers as these make the most trusted Forex brokers in Canada.
The above Forex brokers do not have a license from Canadian regulators, but other reputable regulators from around the world regulate them. In the next section, though, you shall see why they may still not be the best option to go with if you are a Canadian resident, and it all comes down to the regulatory perks.
Before we even get to the topic question, it is important to first define the regulatory environment in Canada. There are several financial regulatory bodies in Canada, but the main financial regulator is the Canadian Securities Administrators CSA , which covers the main financial markets. The IIROC was created in around the time of the financial crisis to respond to the various problems in the Forex market.
IIROC regulations have not been as restrictive as those observed in the US, fortunately, and they allow great freedom to traders. This fund is set aside for all the best Canadian Forex brokers that have a license from IIROC for a refund to their clients in case the company goes bust. Many Forex brokerages have, in the past, experienced problems that led to their downfall.
We have looked at how the financial environment is in Canada and the advantages to dealing with locally regulated brokers. There are other factors to consider as well, most important of which being the financial instruments made available to the traders.
If you want to trade the Forex market, you are obviously going to need a wide variety of currency pairs. The average number of currency pairs is usually about 30, but the best brokers should offer more than 50 currency pairs. With this huge variety, you get the flexibility to try new opportunities and make even more profits. Additionally, you should also look for those brokers offering other trading instruments beyond Forex.
The best Canadian CFD brokers should provide other instruments in the form of derivatives. For example, stocks, indices and commodities can all be provided in the form of derivatives in order to expand your portfolio. More recently, cryptocurrencies have become all the rage, and there are already some IIROC cryptocurrency brokers. Even though cryptocurrencies have not been legalized in Canada, these brokers treat them as over-the-counter derivatives. Under the label, they are allowed to offer cryptocurrencies like bitcoin, Ethereum, Litecoin, etc.
In case you had an interest in cryptocurrencies, you will now have the opportunity to trade them through your Forex broker.
Finally, check other offerings by the broker before making the final decision. Take money transfer options, for example. A good Forex broker should have various avenues for you to make your deposits and withdrawals easily and quickly; preferably in Canadian dollars.
As in any business, the seller is going to tell you everything they think you want to hear. There are many forums and broker review websites available where traders discuss their experiences.
Make sure to go through all of these beforehand in order to avoid falling into one of the several Canada Forex scams. Stay up to date with the financial markets everywhere you go. Home - What are the best Forex brokers and how to choose the right one?
How do you choose the best Canadian Forex broker from the rest? Some of the top Canadian Forex brokers available There are currently only a handful of Forex brokers based in Canada due to the regulations regarding retail Forex trading in the country. Nevertheless, the largest Forex brokers in Canada have made the move into Canada in order to better serve the Canadian residents, and these include: Trading platform MT4, WebTrader.
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