Best FINMA-Regulated FOREX Brokers

Why is Switzerland an Important Financial Capital?

For a start, we should mention that FINMA-regulated brokers do not only accept clients from Switzerland. You don’t have to live in Switzerland to get the benefit of FINMA’s excellent regulation.

Switzerland is a major financial capital of the world. Its prominence as a global financial capital and a hub of trading markets can be attributed to several factors:

Historical Stability: Switzerland has maintained political neutrality and stability for centuries, which makes for an environment of trust for depositors and investors.

Bank Secrecy: Historically, Swiss banking laws prioritized discretion, attracting wealthy individuals and entities from around the world. Although bank secrecy has been relaxed recently due to international pressure, the tradition of confidentiality remains strong.

Highly Developed Financial Infrastructure: Swiss banks are among the world's largest and most influential. Zurich and Geneva are major hubs for wealth management and private banking. That said, this year saw Switzerland’s financial clout take a knock when one of its major banks, Credit Suisse, had to be taken over by rival UBS.

Currency Strength: The Swiss Franc (CHF) is considered a "safe-haven" currency, which means that in times of global economic uncertainty, investors often convert their assets into CHF, thus reinforcing Switzerland's financial importance.

Regulatory Environment: Given these factors, it’s no surprise that Switzerland offers a well-established and predictable regulatory framework. FINMA ensures a robust and transparent financial market.

FINMA in Brief

Why is FINMA so well regarded? FINMA is the Swiss body responsible for financial sector regulation in the country. This includes the supervision of banks, insurance companies, stock exchanges, FOREX brokers and other financial intermediaries present in Switzerland.

FINMA is an independent institution with its own legal personality, based in Bern. It is institutionally, functionally and financially independent from the central federal administration and the Federal Department of Finance (FDF) and reports directly to the Swiss parliament.

For FOREX companies specifically, FINMA plays two roles. The first is to uphold transparency. The second is to prevent scam brokers from stealing their customers’ money. For more information on the anatomy of a FOREX scam, read our article here. Given its excellent reputation, a significant number of FOREX brokers and binary options brokers from all around the world have obtained registration from FINMA.

What Protection Does FINMA Provide FOREX Traders?

Table of Top Finma Regulated Brokers

How to Verify that a Broker Is FINMA-Regulated

Each Swiss-based FOREX broker with which you are considering opening an account ought to be licensed by FINMA. Details for this should be easily accessible on FOREX companies’ Websites, with each carrying a registry number. In cases where a company claims it is licensed by FINMA, you can easily verify this information by visiting FINMA here: https://www.finma.ch/en. If you find results, then the company’s claims of licensing are legitimate. Otherwise, the company in question is not licensed by FINMA and should be avoided at all times.

How Much Money Do You Need to Get started?

You don’t need much to get started. Some of the best FOREX brokers for beginners allow you to start trading with as little as $1. Of course, you need to capitalize your account with at least some money that will allow you to place trades. The amount is really up to you. However, it is recommended that you start by placing small trades to get to grips with the practice of trading as well as your broker’s Website before you move on to placing trades with more money.

How to Avoid Scams Through FINMA

What to Look for Among the Best FINMA-Regulated Brokers?

Here’s how we suggest you go about choosing the best FINMA-regulated broker for your needs:

• FINMA-regulated: It sounds obvious, but check and double-check that every broker you consider holds the esteemed FINMA license.

• All Traders Welcome: Make sure the broker you choose is Swiss-based and accepts local traders and foreign traders, too.

• Reputation is Paramount: Be careful to only consider brokers with an ironclad reputation, meeting, if not exceeding, the industry's stringent safety benchmarks.

• Competitive Fees: You should zero in on brokers boasting low floating spreads and competitive per-trade commissions. For more information on how spreads work, read our article here.

• Sleek, Feature-Packed Platforms: Beyond usability, try to find a broker whose platform is packed with analytical tools to give you that cutting edge.

• Diverse Account Offerings: Recognizing that one size doesn't fit all, consider brokers with a broad spectrum of account types—catering to newbies and elite traders with varied strategies.

• Diverse Instruments for Every Trader: Every broker should ensure traders have access to a rich mix of instruments across multiple asset classes.

Commission and Fees

This area of consideration is crucial and requires your close attention. For a start, FINMA-regulated brokers must offer you a competitive fee package. Trading fees can sometimes be difficult to track. Be sure to check how these fees compare with industry standards:

Spreads: There are two main kinds of spread, one is fixed and the other is variable. Generally, the spread refers to the difference or gap between two prices, such as the bid/ask rate in a currency exchange rate. An example of a good spread is 1.4 pips for the EUR/USD (the narrower the better, this means that a spread of 1.4 pips is better than a spread of 2 pips). To find out more about pips, go here.

Commission: This is nothing more than the service charge that brokers require for carrying out transactions on behalf of their clients.

Rollover fees: When you leave a trade open overnight, the broker normally charges a rollover fee for the facility of holding your trade open for that period of time. This is because they assume the risk of the market changing adversely.

Withdrawal and Deposit Fees: Some platforms might charge fees for depositing or withdrawing funds. Pay attention to this. It's important to be aware of these and any associated limits or conditions.

Subscription or Inactivity Fees: Certain platforms have monthly charges or fees for inactive accounts. Ensure you're aware of these potential costs.

Using Leverage with FINMA-Regulated Brokers

This is linked to our point above about regulation. Different regulators have different guiding policies in leverage. Consider this, with brokers based in Europe operating under the rules of the European Securities and Markets Authority (ESMA), the leverage for Contracts for Difference (CFD) is heavily regulated. Because of this, you can only get leverage of:

• 30:1 for major currency pairs   

• 20:1 for non-major currency pairs, gold and major equity indices   

• 10:1 for commodities other than gold and non-major equity indices   

• 5:1 for individual equities and any underlying not otherwise mentioned  

• 2:1 for cryptocurrencies

However, you should note that FINMA does not fall under ESMA rules. Switzerland is not a member of the European Union. Therefore, it is not directly subject to the regulations and directives of ESMA, including the Markets in Financial Instruments Directive II (MiFID II).

However, it's worth noting that Switzerland strives to maintain a financial regulatory framework that is in many ways comparable and competitive with international standards.

Regarding leverage, FINMA hasn’t set a specific maximum leverage limit for FOREX trading as is seen in some other jurisdictions, like those governed by ESMA in the European Union.

However, brokers operating in Switzerland under FINMA are expected to follow strict risk-management protocols, and they are required to ensure that their clients are trading within their means and understand the risks associated with leverage.

It's worth noting that leverage offerings can vary among Swiss brokers, and it's always a good practice for traders to verify the current rules and offerings directly with the regulator.

FINMA and Negative Balance Protection

Tradable Assets and Instruments

Some of the most common assets include FOREX, commodities, crypto, bonds, and more. All the top FINMA-regulated brokers normally have these bases well covered. Some brokers choose to concentrate on FOREX, while others may be strong in other areas. It depends on your interests. When comparing brokers, a handy hint is to create a spreadsheet where you compare the numbers of the tradable assets you may want to trade.  Remember that the availability of tradable assets varies depending on the broker and trading platform being used.

Payments, Deposits and Withdrawals

The Importance of Customer Service

Ask Other Traders on Our Network

Here at Arincen, we’ve gone to extensive lengths to create an enabling environment of networks, where traders of all backgrounds can take part in a vibrant trading space. After all, Arincen’s goal is to simplify the world of trading. Our Website provides an unrivaled slate of tools, like our market-leading signals, rolling news, and a thriving community where traders of all levels of experience can learn and profit from each other.

Trading Platforms, Tools and Features

As Switzerland is such a vibrant trading space, all brokers based in the country provide a range of tools to enhance your trading experience. They can hardly be complacent in this regard as they will quickly be overtaken. Some brokers have their own proprietary platforms, while others are well served by such tried-and-tested industry favorites as MT4, MT5, and cTrader. For a helpful comparison of the two MetaTrader platforms, read our article here. Switzerland is a technologically capable country that supports brokers who require the fastest networks to support high-volume trades.

With FINMA-regulated brokers, you will generally have access to advanced platforms with deep market access and extremely high platform uptime. Be sure to check on all these points before you settle on your chosen broker.

Tips to Get Started Trading with a FINMA-Regulated Broker

Opening a FOREX trading account is easy. Once you have chosen your preferred FINMA-regulated broker, you must start by filling out an application form as part of the “open account” process. It is normal that you will be asked to provide two documents. These are usually your national identity documents and proof of address. This is part of Know Your Customer (KYC) regulations. Remember that some brokers have slightly different requirements than others.

Once your account has been approved, normally one to two days after you make the application, you will be able to fund your account by making the first deposit. After your account is funded, you can start to trade.

How to Improve Your Knowledge of FOREX Trading

A trading Website like en.Arincen.com is a great place to start. We have a large list of curated articles that can give you all the information you need on common FOREX trading terms, like pips, spreads, leverage, and support and resistance. We have also taken the time to prepare detailed articles on important topics, such as FOREX trading strategies. Additionally, once on our Website, you will find helpful video courses that cover the basics of FOREX trading. With this range of knowledge, you will be well on your way to trading success.

Remember also that your broker will normally have developed a detailed education and research repository itself. That is also a good place to bolster your FOREX knowledge, with the extra benefit that your broker’s information will be slanted toward its own platform and resources, which makes it doubly useful.

As such, it’s relatively easy to improve your knowledge of FOREX trading. All the following items should be part of a FINMA-regulated broker arsenal, and they should all help you improve your knowledge of FOREX trading.

Educational Content: For beginners, educational resources are crucial. Look out for platforms offering webinars, tutorials, articles and even demo accounts to familiarize users with trading concepts.

Analytics Tools: The platform should offer robust analytical tools and many methods to evaluate trader performance. This includes historical returns, risk metrics, trading strategies and more.

Community Engagement: A vibrant community can provide peer reviews, insights and discussions, which can be invaluable for both novices and experienced traders.

Real-time Data: This is the lifeblood of social trading. Make sure your broker gives you access to live market data, news updates, and economic calendars that can help in making informed decisions

Filing a Complaint Against a FOREX Broker

In the rare cases where your FOREX broker has unlawfully tampered with your account, then you can file an official complaint with FINMA by visiting the following link https://www.finma.ch/en/finma-public/reporting-information/.

It is very unlikely that a FINMA-licensed company would dare meddle with your account for fear of the repercussions that may result. These include canceling the company’s FINMA license and/or closing it down altogether.

Let’s Recap

Arincen’s Review Methodology

The team at Arincen collected more than 120 pieces of data covering in excess of 100 licensed FOREX companies. Data collection was done in three ways:

1. Companies’ Websites.

2. Other Websites that have ranked FOREX companies.

3. A survey questionnaire (referred to here as Survey “1”) was sent to the companies invited to participate in the exercise. We have identified 13 criteria for our assessment, each containing several aspects and carrying its own relative weight. These include licensing, deposits and withdrawals, number of assets, etc.     

Afterward, we validated the data by:

1. Registering with FOREX companies as a secret shopper and/or as Arincen.

2. Survey number “2,” in which we asked these companies’ customers for important feedback and past experience.

The next step saw us evaluate and rank each company, relying on the hard work of 15 Arincen employees. We were cautious in ensuring the most accurate assessment possible, including taking into account different languages, as well as the various mobile-app operating systems, e.g., Apple, Samsung, etc.

To add credibility to our research project, we sent a third and final survey (referred to here as Survey “3”) to enable participating FOREX companies to evaluate our own research and whether it accurately reflects the realities on the ground. We were fortunate enough to receive a mark of 9.9 out of 10! We have kept to a minimum the margin of error, which stood at a measly 1%. To learn more about how we came up with the evaluation, please click here.