BrokerGuru February 11, BrokerGuru December 1, If you are from the US you can be quite puzzled by the amount of brokers that are offering the services throughout the world, but are still not present in the States. The important thing to understand here is that, although the US online Forex market appears heavily regulated, this particular regulatory system is more of a system of ethics than a direct legal guideline when it comes to the world of online trading. Please suggest by adding a comment below.
11 rows · A list of the best Forex Brokers for US clients. Due to tough new regulations imposed on US Citizens (by the NFA and CFTC) trading levergaed financial products, which includes spot forex, many .
US residents can trade Forex
While registration itself isn't the issue, being a member of NFA regulated brokers group requires adherence to the strict NFA rules. Online Form 7-R 2. All US brokers are required to provide leverage no higher that This leverage will be offered to all US residents without exception. Non-US residents, who seek to open an account with the US based broker, might be able to get a higher leverage for their trading accounts.
This option is often available when a broker has multiple branches around the globe. Among such brokers are: ATC Brokers - The two striking differences are: This makes US brokers less competitive in the eyes of many novice traders, who generally need a larger leverage boost from the start. Forex brokers in the US are among the most regulated brokers in the world.
The regime and penalties by NFA are high and strict, thus no one essentially wants to go off the marked path. This fact certainly provides the highest level of trust to the US brokers.
Although traders won't find better regulated Forex brokers than those in the United States, other countries to consider are: UK, Australia and Switzerland. Please suggest by adding a comment below.
I am with TryMarkets. And I found they are the best broker in forex industry. This broker offering fast execution and tight spreads over products on currencies, metals and indices to their clients. You can have direct access to inter-bank prices and they are top tier liquidity providers. They give flexible leverage facility. And the true ECN pricing.
Customers funds are secure in their hands, because their security policy is so good. And yes, they don't accept US clients. You need to remove from the USA list.. This amount of money only corresponds to a deposit that a broker has to make and does not include any legal fees associated with obtaining the licenses, employment of lawyers to be placed on the register and executives.
In other words, the US market is an expensive market to operate on. Even though some brokers make profit enough to afford it, 20 million dollars is quite a large sum to allocate just for a license. On average, the world's 15th largest broker would hardly earn 10 million USD in profit annually, hence allocating a profit of 2 years for the privilege to work in one country is an extremely serious investment.
The situation with capital requirements was quite different back in and at that time there were quite a few brokers that accepted US clients. However, today the amount of US friendly brokers is just less than five. Now you may wonder, if there are only a few brokers in the US, why are more brokers not trying to penetrate the market? There are over million people living in the US and it is quite hard to believe that there are no more brokers that could actually afford the NFA licensing.
Well, the truth is that, although more brokers could deposit 20 million to operate, not every broker will find it profitable. As you know, FX brokers earn from the volume traded, hence the higher the trader's volume is, the more profit a broker makes. However, unlike European countries where a trader has access to the leverage of This means that a broker can expect to receive some 10 times smaller profit in the US than in Europe, provided that it has the same amount of traders with the same amount of deposits in the two regions.
Furthermore, yet needless to say, wages in the US tend to be quite high, so the whole process of financing the US-based operations is not cheap at all. Even though it is already quite hard for some brokers to start operating legally in the US and then to become profitable, historically US authorities have also been seen as a hindrance.
Quite a few brokers have been heavily fined by the NFA for malpractice. While the impact of the reasons behind the fines could be quite insignificant, the fines tend to be heavy: In other words, a broker may spend a year working hard, and by the end of the year its profits or even more can be simply taken by the regulator as a result of certain misconduct.
US traders have also been much more inclined to stock trading, this is why they often choose to acquire shares over currencies. In most cases, trading stocks is actually more expensive for traders or more profitable for brokers than Forex. This is why US based brokers not only have to compete against each other, but also in order to take a slice of the stock brokers' pie by increasing the awareness about online currency trading.
The limited amount of FX brokers in the US is certainly caused by the heavily regulated environment that requires brokers to deposit a substantial amount of funds and, at the same time, decreases brokers' profitability by limiting leverage. This also results in a few unregulated brokers offering their services in the US as they can better meet the needs of the traders, while their legal and operational costs are minimal.
However, unregulated brokers that accept US traders should never be your choice. We're sorry, an error has occurred. Please try again later. Notification of this error has been sent to our technical support team. To remain on this page, click Cancel.
37 rows · According the US regulations of the spot Forex market, only these brokers may accept . Contents1 US regulated forex brokers2 Why many offshore international forex brokers don't accept US residents as clients3 Offshore forex brokers that still accept US Clients: US regulated forex brokers Note: We don't include IBs(introducing brokers) in this list. The List Of Outside US Brokers Accepting US Residents Having explained, fortunately, US strict regulations do not completely stop international brokers from accepting US citizens. There are certain offshore international Forex brokers that accept US citizens.