Forex Brokers in South Africa for 2021 have been revealed. In this article, you will see a complete list of the best Forex brokers South Africa 2021. These Forex brokers with bonus will give you the best trading experience. You will also see best FSB / FSCA regulated Forex brokers in South Africa. Finding the right Forex broker in SA can be a challenging task, that is why we’ve decided to do a research for you. You will also find South African Forex brokers with welcome bonus.
What is a Forex broker?
A forex broker, also called a forex broker, buys and sells currencies on your behalf. A forex broker allows you to benefit from 24-hour market access and to speculate on currency pairs from around the world. Forex brokers try to keep their costs down to stay competitive in the market, but there are some fees that you will incur when using their service, including a spread. Transactions in the forex market are done in pairs: you buy or sell the pair you want to trade, for example EUR / USD.
Best FSB / FSCA Regulated Forex Brokers in South Africa
|FSCA, MiFID, ASIC|
|CySec, FSCA, ASIC, FCA|
|CySec, FSCA, ASIC, FCA|
|CySec, FSCA, ASIC, FCA|
|CySec, FSCA, ASIC, FCA|
Types of Forex Brokers
When the time comes to talk about a broker or broker and their different modes of operation, many traders are getting involved, this post is to shed light on this often misunderstood but so important subject!
The first step in choosing a Forex broker South Africa is to determine what your choices are.
You don’t just walk into a restaurant knowing what to order right away, do you?
No, unless you’re a frequent customer, of course. More often than not, you first look at their menu to see what they have to offer.
There are two main types of Forex brokers:
- Dealing Desk (DD)
- No Dealing Desks (NDD).
Dealing Desk brokers are also called Market Makers.
The No Dealing Desk can be subdivided into two parts:
- Straight Through Processing (STP) and
- Electronic Communication Network + Straight Through Processing (ECN + STP).
What is a Dealing Desk broker?
Forex brokers who work under the Dealing Desk (DD) broker format make money from the spreads and liquidity provided to their clients.
Also known as “market makers”, Dealing Desk brokers literally create a market for their clients, which means they often take positions against their clients.
Maybe you think there is a conflict of interest? imagine that this is really not the case.
Market makers provide both a buy and sell price, which means that they fulfill their customers’ buy and sell orders; they are indifferent to the decisions of an individual trader.
Since market makers control the prices at which trades are executed, it is also very low risk to set FIXED spreads (you will understand much better later).
In addition, clients of Dealing Desk brokers do not see actual interbank market rates. Do not be afraid! However, the competition among brokers is so strong that the rates offered by Dealing Desk brokers are close to, if not identical, to interbank rates.
Suppose you place an order to buy EUR / USD for 100,000 units with your Dealing Desk broker.
To execute you, your broker will first try to find a matching sell order from their other clients or forward your trades to their liquidity provider, i.e. a sizable entity that easily buys or sells an asset. financial.
In doing so, he minimizes the risks, because he gains Spread without taking a position opposite to your trade.
On the other hand, if there are no matching orders through their clientele, they will have to take the opposite side of your trade.
Take note that different Forex brokers have different risk management policies, so be sure to check this with your own broker.
What is a No Dealing Desk broker?
As the name suggests, No Dealing Desk (NDD) brokers do NOT place their clients’ orders through a Dealing Desk.
This means that they do not take a position against their clients, because they are simply connecting two parties which are their clientele and the interbank market.
NDD brokers are like bridge builders: they build a structure on otherwise impractical or difficult to cross terrain to connect two areas.
NDD brokers can either charge a very small trading commission or simply put a margin by slightly increasing the spread.
No Dealing Desk broker can be STP or STP + ECN.
What is an STP broker?
Some brokers claim to be real ECN brokers, but in reality they only have a direct processing system, in other words the Dealing Desk.
Forex brokers with an STP system route their clients’ orders directly to their liquidity providers with access to the interbank market.
NDD STP brokers usually have many liquidity providers, so each provider offers their own bid and ask prices.
Let’s say your NDD STP broker has three different liquidity providers. In their system, they will see three different pairs of auctions and ask for quotes.
What is an ECN broker?
In contrast, true ECN Forex brokers allow their clients’ orders to interact with the orders of other ECN participants.
Participants could be banks, retail traders, hedge funds and even other brokers. In reality, participants trade against each other by offering their best bid and ask prices; here again the competition on Forex is so strong that the prices offered are similar to the prices offered on the interbank market.
ECNs also allow their clients to see the “depth of the market”.
Market Depth displays the buy and sell orders of other market participants. Due to the nature of ECN, it is very difficult to apply a fixed margin, so ECN brokers are usually remunerated through a small commission.
How did we choose our best Forex brokers in South Africa?
First of all, our team made sure that the Forex broker in South Africa is regulated and licensed to provide online trading services to traders. We then conducted countless hours of in-depth research and analysis on the services offered by the brokerage firm.
From there, we were able to put together what we believe are among the most important factors to consider when choosing the best Forex brokers South Africa and we gave them an unbiased rating based on our opinion from those results.
The Forex brokers who are on our list of the best Forex brokers in South Africa must be regulated, offer competitive trading conditions, including tight spreads, low commissions and reliable transaction execution speeds.
The Forex broker should also have user-friendly trading platforms that are compatible with multiple devices including desktop, web and mobile. Besides intuitive and powerful platforms, it should provide trading tools and educational resources to help traders in their daily activities.
Other factors that we also consider important for a broker to make our list of top brokers in South Africa include variety of money deposit methods, types of trading accounts, minimum deposit requirements, customer support , the markets and the range of trading instruments available for online trading.
Regulation of brokers
Any Forex broker who offers services to traders in South Africa must be licensed and regulated. Using a regulated Forex broker can offer investors some protection that unregulated brokers cannot. Many experts and professional traders only deal with a regulated broker.
The online Forex trading in South Africa is popular among residents. Although many internationally regulated brokers can accept South African clients, the fact that the broker is regulated and licensed by Financial Sector Conduct Authority (FSCA), which is the financial regulator in South Africa, is an added advantage.
The FSCA is the stock market regulator in South Africa. The FSCA is an independent public body responsible for protecting investments in financial instruments and all other forms of savings and investment, as well as maintaining the proper functioning of financial markets.
To find out if a Forex broker is licensed to operate in South Africa, the first step is to identify the regulation number in the information text at the bottom of the broker’s home page. Then you can check the broker with the FSCA to validate the legitimacy of the broker’s regulation.
Trading platforms offered by Forex brokers in South Africa
Each Forex broker can have a range of different trading platforms for multiple devices, including desktop, web and mobile trading applications. Broker platforms should be easy to use and have plenty of tools and features to accommodate different styles and strategies of trading. If you are already familiar with a particular platform, you can make sure that it is available. If you are new to online trading, MetaTrader and cTrader are considered to be some of the best trading platforms for forex and stocks.
Financial assets to trade
Forex Brokers South Africa should provide traders in South Africa with a wide range of trading instruments across multiple asset classes including Forex , Commodities , Cryptocurrencies , Stocks , Indices , Options , ETFs and CFDs. The more markets the broker has to choose from, the easier it can be to expand and diversify your portfolio in the future, if desired.
Spreads used by Forex brokers
Brokers usually charge you a spread for each trade you make. The spread is the difference between the bid price and the ask price at the time your position is executed in the market. Generally speaking, the lower the broker’s spread, the more cheaply you can enter the market and the lower your transaction costs will be in the long run. However, execution speeds can also depend on other factors such as broker liquidity, slippage, and execution pattern.
Commissions on your trading operations
The majority of Forex brokers SA charge a small commission to clients who go through them to complete transactions. This is another cost to consider in addition to the spread. Again, the lower the broker’s commission, the more you can save on long-term trading expenses. Some trading strategies depend on tight spreads and low commission fees. Thus, the best South African brokers should have some of the most competitive commissions and spreads.
Brokerage fees applied by the Broker
In addition to the above mentioned spreads and commissions that brokers may charge, there may be additional fees. These include day-to-day swap fees, funding fees, platform fees, trading tools fees, educational resource fees, inactivity fees, etc. All other fees charged by the broker must be competitive and transparent to the trader.
Order execution speed
The speed of execution determines how quickly your order is placed on the market. The faster the execution speed, the better the price you can get. Instant execution means the order is placed
Liquidity providers for brokers in South Africa
A market maker or liquidity provider is a company or individual that quotes both a buy price and a sell price for a financial instrument or commodity held in stock. Brokers usually have a liquidity pool made up of several liquidity providers. The best FX brokers in South Africa should ideally have a wide range of liquidity providers with substantial liquidity funds so that they are able to provide competitive buy and sell prices as well as reliable transaction execution speeds.
Trading tools made available by the Broker
The trading platforms provided by brokers should have an abundance of useful trading tools to help traders perform in-depth analysis of the market. Some brokers also have additional trading tools in order to provide a more efficient trading experience. These tools can include economic calendars, trading calculators, daily market analyzes, trading signals and more. The best Forex brokers in South Africa usually have free trading tools to help traders with their daily trading activities.
Educational and training resources made available
The best brokers should have a choice of educational materials to help traders increase their knowledge and improve their trading skills. These can include tutorial videos, trading guides, eBooks, trading glossaries, FAQs, webinars, and seminars. Some brokers even have dedicated trading academies that can help support informed trading.
The different types of accounts offered by online Forex brokers SA
Brokers tend to offer at least one real trading account and one demo trading account. Some brokers offer a selection of different types of accounts to meet different client needs. These accounts may vary depending on the minimum deposit required, leverage available, type of execution, spreads, commissions, instruments, additional services and more. The best SA Forex brokers should have a selection of account types for different levels of trader and trading strategies.
Demo accounts can be useful for practicing online trading with virtual funds and for getting familiar with the broker’s trading platforms and services.
The different ways to fund your Trading account
When you open a trading account with a broker, you can make deposits and withdrawals using the available funding methods. While most brokers offer wire transfer and credit / debit card payments, some brokers use online payment solutions such as Skrill, Neteller, and PayPal. The best Forex brokers South Africa should have a choice of convenient financing options.
Customer Service for Trading Sites
Most online Forex brokers can be reached by phone, email, or live chat. It’s worth making sure the broker is reachable in a way that’s convenient for you. We believe that the broker’s customer support team should be quick, polite and efficient in responding to all general and technical questions from traders. You can check the broker’s time zone and consider if there is a difference between your time zone and the broker’s support hours, as this could impact the time it takes for them to respond.
Conclusion and summary in choosing the best trading sites in South Africa
While these are what we consider the most important things to consider when choosing a broker in South Africa, it can vary depending on the individual needs of traders. It is therefore imperative that you choose a broker that meets your personal needs and that you use the above information only for educational purposes and not as trading advice.