How to Trade with the Best Forex Brokers in Canada?
Canadian forex market is growing, but the growth rate is very slow, which could not attract the best international brokers. However, a very few best broker Canada is available for retail clients, and here we will provide a guideline to trading with them.
Canadian Forex Regulation
Canada brokers are not really considered as a broker; instead, they are categorized as “investment dealers.” As a result, the Investment Industry Regulatory Organization of Canada, or IIROC, regulates Canada’s forex market. However, it is great as the IIROC rules are considered some of the best financial transaction rules. So, forex broker Canada is safe to trade.
Canada has different jurisdictions in different provenance and territories, where each part of the country has its own regulatory body. However, the individual regulatory body may have additional rules over the IIROC for the traders as well as brokers.
However, Canada is liberal about financial services, which means anyone from outside of Canada can trade with the regulated forex trading broker Canada. Besides, the Canadians can also trade out of their boundary.
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Choose a Forex Broker Canada to Start Trading
First thing first, you will need to choose a forex broker Canada. However, it depends on the area you live in or your preference on any certain territories. Forex trading Canada has three provincial agencies on top of the IIROC. So, you need to choose any provenance from the following list.
- British Columbia – British Columbia Securities Commission.
- Toronto – Ontario Securities Commission
- Montreal & Quebec – Autorité des Marchés Financiers
Things to Look before Selecting a Forex Trading Broker Canada
Since Canada does not have many brokers to choose from, more or less all the brokers offer the same offers and features. Traders may choose the broker from Canada or offshore. There are some common features you should check before choosing a broker, regardless of the location.
- Regulations (we have discussed later how to check it).
- The broker’s territory- If you decide to trade with the Canada brokers, you need to check this because you will need to know the local regulations.
- Leverage and spreads- Try to find the high leverage and low spreads broker; you may look for either one too.
- Fees and commissions- Fees and commission structure is important as these will decide your profit level.
- Trading platforms- Platforms will tell you how easy the broker is. You can check our take on forex trading platforms. However, we have provided a brief on platforms later in this article.
- Account types- Beginners and experts don’t use the same account type. Beginners’ accounts are easier and more flexible.
- Deposit and withdrawal methods- Complicated transaction methods will be time-consuming and sometimes may incur extra money.
- Customer service- Prompt customer service will make your trading life easier.
- Education tool- Nowadays most of the brokers offer education features for the traders. So, you may check this out too.
- Swap-free- If you are Muslim, you may look for the swap free forex broker Canada, which give you an interest-free account.
By looking at these checklists, you can also sort out the best forex broker Canada. If you are confirmed about your territory and broker, you can go ahead to check that broker’s licensing.
Check the Licensing
Before starting trading with the best broker Canada, you should check the brokers licensing through the IIROC. You can do this simply by putting the broker’s license number on the IIROC database. However, you should find the number as a risk disclosure at the bottom of the broker’s website.
Alternatively, you can search the broker on IIROC’s ‘Dealers We Regulate’ page. However, if you don’t find the broker on the list, then you may check out with local regulatory authorities.
Special Rules for the Alberta
You cannot just register with any broker in Alberta and start trading. You will need to comply with some criteria to start trading. Following are those
- Your minimum income should be $200,000 for the last two years.
- You will firmly need to hold at least $5,000,000 investments in property.
- $1,000,000 financial investments.
- You have to go to a financial institution or a bank.
However, you don’t need to meet all criteria. Instead, you will need to qualify at least one from the above-mentioned list to become an ‘accredited trader or investor.’
Information You Need to provide the Forex Brokers Accepting Canadian Clients
Whether you want to trade with an ordinary broker or the best forex brokers Canada, IIROC has a ‘know your client rule’ which ask a range of personal question from each trader, which includes,
- Age
- IDs
- Marital status
- Profession
- Number of dependents
- Source of the funds
- Social Insurance Number
- Net worth
- Income
- Level of risk tolerance
- The objective of your investment
- Related knowledge and experience
- If you or anyone from your family members are a ‘politically exposed person.’
What to look for the Best Forex Trading Platform Canada?
The platform is a vital part of the forex trading Canada as you will spend your hours on the platform. So, you will surely need the best platform. However, you may look for the following things for the best forex trading platform Canada.
- Design: The platform provided by the best forex brokers Canada should be user-friendly and easy to navigate.
- Charts and Graphs: Charts and graphs are necessary to check the price trends. A good platform must provide multiple charting features, which should include multiple timeframes.
- Risk management features: The platform should offer the possible risk management feature to reduce any potential loss.
- Automated trading feature: Automated entry and exit can get your transaction done with no delay.
- Copy-trading: This feature is beneficial for beginners, as they can replicate others trading and understand forex trading Canada.
- Customizable indicators: Most of the modern brokers offer customizable indicators, which you can customize according to your requirements.
However, a simple trick to find a forex broker Canada is to look for the MetaTrader 4 forex brokers and MetaTrader 5 forex brokers. Besides, you may come across some other platforms too. But you should sign up with the one you can be comfortable with.
Conclusion
Canada may not be the best location for forex trading¸, but reputed foreign exchange companies have their office there. The strict regulatory features and attractive jurisdictions lead to creating some of the best forex brokers Canada.
However, you should check the broker carefully before deciding to trade with it. Furthermore, you should check the brokers’ provenance, too, as the local regulation varies.
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