Despite the fact that India is not among the richest countries in the world, it is still open to investments and plays a big role in global financial markets such as Forex. People who have saved money or earn good salaries want to invest and currencies become one of the best choices. However, how do you know which broker to choose in such a big industry where scams abound?
We are going to look at some of the key things and they are: picking a regulated Forex broker, selecting an easy to use trading platform, checking if the broker has competitive spreads, variety of accounts, good customer and useful extra services. Let us look into each these now. This is where things might get a little complicated.
In most countries of the world you may have loose and strict regulators with different requirements for brokers, but if you live in EU or US you would be able to trade any currency pair in the world and use quite large leverage.
Limits that are imposed on brokers in the area would be more on manipulation, risk, inside trading and acting without license type ones. When it comes to India, it is completely different. In the institution was authorized to regulate securities and capital markets in the country.
Its role has increased more recently and now it issues licenses for brokers, creates regulation, does inspection and auditing and etc. The regulator is also responsible for Forex trading regulation in India. The thing is that trading currencies in India is not entirely legal. The only possibility of trading legally is to trade currency pairs that have Indian Rupee INR in the pair.
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In the same fashion, online trading using online platforms is not permitted for Indian citizens. Internationally brokers are allowed to offer their services in the country. So, current situation for Forex traders in India does not look very appealing. However, the government is considering lifting the restrictions to allow more popular pairs to be traded by Indian Forex traders.
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Let us hope they will lift the limits sooner rather than later. As it is illegal for Indian traders to use online Forex platforms there is not much to be said. However, Forex traders that are not natives and reside in India can trade and use those platforms. As we expect that this ban will be lifted for Indian traders we will briefly mention what you need to expect from a broker regarding the issue.
If a broker offers a platform that is complicated to use and which is not user friendly you may have serious problems. There are countless of cases when traders wanted to close their positions and actually doubled them experiencing big losses, because they could not figure out how to simply close a long or short position.
Good brokers often include a button that can close all of your positions if you need that.
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In terms of platform, you should be given at least a few options to choose from. One would be a downloadable platform such as Metatrader 4, another one an online version that could be traded from your favorite browser. Finally, most brokers will offer you a choice to download an app from their website, install it on your smart phone and trade it wherever you go.
These can be fixed, variable or fixed with an extra fee. Fixed spreads tend to be the largest in the industry. Variable spreads depend on market conditions. However, if some fundamental data hits the market you may expect the spread widen to pips per most popular pairs and even more with less popular ones. Occasionally, some companies offer a small fixed spread with an extra small fee per position. So, you can have 0.
You do not need to worry if you have only a small amount to trade currencies. All of the brokers offer leverage, which means you, will be able to open much larger position than your initial deposit. However, you will also have to limit risks. And if you have 10k or more brokers would possibly offer you a standard account. There could be many more variations of the types of accounts, for example, Islamic account where interest accruing rules would not apply or VIP for particularly large sums of money and special services.
You need to contact a broker and discuss your needs with him to find out which type of account fits you best. An Indian Forex trader should naturally expect service in his native language or a dialect that is widely spoken in the area. If it is only in English, you better go somewhere else, because the broker probably came just to get, not to give. Online customer support is also something you would expect from a reliable broker.
A broker should be there to answer questions, solve issues, discuss problems and offer advice in a fast and effective manner. Slow customer service is a bad manner of business and you should stay away from such brokers. Extra services are also expected from a reliable broker. Regulated brokers will inform their customers about risks trading in the markets, offer various kinds of courses on a variety of financial topics, provide video lessons, post financial news feed on their website as well as economic calendar for all traders to see what fundamental factors can affect markets in the nearest future and etc.
As you may see there are a lot of things to be taken into consideration before you fund your real money account with some broker. When you find a broker who offers the best of what has been described in the article you will be able to trust him and trade your money with focus and confidence which will ultimately help you to make money.
Crypto Hub. Still, Forex is a highly decentralized market hard to track down, and many European and American brokers established their seats in India and run their businesses normally for their European, American, and other non-Indian clients. Indian traders are allowed, but at their own risk.
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Internationally established brokers are not illegal, only Indian citizens are not allowed to use online platforms, and are restricted to trading with INR and SEBI registered brokers. If the international brokers fit this profile, Indians can trade freely. This is also one of the reasons why global brokers profit with regional offices in India. India is one of the countries with the biggest gap between the rich and poor, but that does not affect Forex companies. Since the number of wealthy Indians is pretty much high, the Forex market does not lack Indian clients who seem to have developed a true passion for currency trading.
Top Forex brokers in India will offer the best services and link their customers to the best quotes and prices accessible through sophisticated platforms which are in line with the highest industry standards.
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Since Forex trading has a lot to do with the right timing, time zones should not be neglected by traders. Let us see how the geographical location and time zones affect the Indian market. Besides the usual trading risks related to Forex exchange, the time zones can be a little bit troubling as well. What is Currency Trading or Forex Trading? How to open a Forex Trading account?
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