Regulated Broker
- Thread starter Arleigh
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- brokers license regulation
As a trader we should always look for a regulated and trusted broker, that's why searching carefully and wisely in a broker is mandatory for us as a trader we can avoid fraud. Basically, You will know if the broker is regulated if it is registered or under licensed in CySEC (Cyprus Security) and the second major CySEC ruling is the mandatory participation in the Investor Compensation Fund (ICF), and that will provide a safe and secure trading environment and also that can provide all the knowledge and tools that the trader needs in a trading.
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most of the time a regulated broker provide or show its regulation on its own website.
Regulated brokers should present their license/registration information on their websites. When you find their license or registration number - proceed to the respective regulator's website and find the company's profile there using that number. Then, make sure the data matches. For example, the license should cover Forex trading services and the website (domain name) should usually be mentioned somewhere in the profile (under something like 'Doing business as').
Both are solid regulatory agencies. Their rules regarding the trading restrictions are very different though. So, a trader should study the specific conditions that would affect his trading and choose accordingly.
An offshore broker can establish a US company, which will become a member of NFA and satisfy all the current requirements for RFEDs.
Dealing with a company that is properly supervised and capitalized is a big benefit. It reduces the risk of both intentional fraud and unintentional financial troubles in the company.
As a trader, some of my rules:
1. Always look for a regulated broker
2. If the broker claims he is regulated - check the regulator's registry to verify.
3. Make sure the broker is regulated by a big, stable authority like - just to name a few - FCA, ACPR, BaFin or CySec (contrary to popular belief Cyprus [CySec] is now a part of the EU and all EU regulations apply).
4. Take note if the broker is regulated or just registered/licensed. There is a difference.
If a broker is licensed - this essentially means he is not regulated by said regulator. Meaning he can provide his services in the said regulator's country but all issues that you may have with the broker and sent to the licence provider will be forwarded to the actual regulator. And if the regulator is some off-shore island (Island of Man, Seychelles, Vanuatu etc) I'd stay away but that's just my opinion.
1. Always look for a regulated broker
2. If the broker claims he is regulated - check the regulator's registry to verify.
3. Make sure the broker is regulated by a big, stable authority like - just to name a few - FCA, ACPR, BaFin or CySec (contrary to popular belief Cyprus [CySec] is now a part of the EU and all EU regulations apply).
4. Take note if the broker is regulated or just registered/licensed. There is a difference.
If a broker is licensed - this essentially means he is not regulated by said regulator. Meaning he can provide his services in the said regulator's country but all issues that you may have with the broker and sent to the licence provider will be forwarded to the actual regulator. And if the regulator is some off-shore island (Island of Man, Seychelles, Vanuatu etc) I'd stay away but that's just my opinion.
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