Best FOREX Broker in India for 2024

With so many choices out there, it's tough to select the right broker. In this case, we've done the work for you. Here is a summary of each broker according to specified characteristics, along with their pros and cons:

1. ICM - Capital 91.10: Best Deposit and Withdrawal Broker

2. Tradeview: 90.00: Trusted broker that offers very low trading costs as well as comprehensive financial literacy materials for its clients.

3. XTB - 85.55: Best Customer Service Broker

4. IG - 85.45: Best Regulations Broker plus Convenient Platform

5. Saxo Bank - 80.09: Excellent Private Trading Platform

6. CMC Markets - 80.07: More than 9,000 Assets

7. ThinkMarkets - 80.05: Aimed at the Audience of Traders

The foreign exchange market is a decentralized marketplace where global currencies are bought and sold. Currency trading is conducted electronically over the counter (OTC). This means that all transactions occur via computer networks between traders all over the world rather than on one centralized exchange. As a retail trader, the best FOREX brokers out there allow you to take part in this thriving global marketplace that was once the sole domain of large institutions. Thanks to the digital age, today, you can claim your piece of the action.
The FOREX market operates 24 hours a day and five days a week (Monday to Friday), except for international holidays. The FOREX market is the largest financial market in the world. The best FOREX brokers in India play a key role in this marketplace by enabling clients to buy and sell through a trading platform. Most trading platforms are accessible in web and mobile format.

Regulation and Licensing in India

India has a well-developed regulatory framework. Financial markets in the country are regulated first and foremost by the Ministry of Finance, which works in conjunction with the Securities and Exchange Board of India (SEBI) and the Reserve Bank of India (RBI). 

Policies relating to the orderly growth and development of the securities markets are formulated under the capital markets division of the Ministry of Finance. This ministry seeks to protect the interests of investors through institutional reforms in the securities markets, building regulatory and market institutions, and providing efficient and strong legislation.

FOREX brokers in India must be registered with the SEBI, which is a regulatory authority whose primary goal is to promote and regulate the Indian securities markets. All financial intermediaries, whether domestic or foreign, must be registered with the SEBI.

The RBI regulates financial markets and systems through different legislation. In the case of FOREX, it oversees regulated FOREX brokers through the Foreign Exchange Management Act, which is designed to closely manage foreign exchange inflows and outflows.

While the SEBI and RBI call the shots in India, there are other major regulators around the world. If you want to read more about some of the best-regarded regulators, read our article on regulation here.
As we have said, as someone resident in India, it’s enough that your broker is regulated by the SEBI and RBI, as long as they are domiciled in India. If you choose an overseas-domiciled broker, you should select one that is regulated by a top regulator.

Choosing a well-regulated broker isn't merely a matter of preference—it's a protective measure. When a broker is under the watch of a regulator, it undergoes stringent assessments to ensure transparency, fair trading practices, and financial security. Opting for an unregulated broker brings with it significant risks.

To ensure that your broker is legit, you can follow these steps:

• Ask if the broker is licensed to sell you FOREX

• Check if the broker is registered with the SEBI

• Ask if your broker is part of a compensation scheme

• Check your statements regularly to ensure that everything is above board.

Remember that it's important to comply with all applicable requirements, including any self-regulatory organizations to which brokers belong, and not just those mentioned here.

Leverage

Leverage is a financial tool that allows you to gain access to much larger trading positions than you would have been able to with your own capital. Depending on the regulator under which your broker works, you will encounter different policies relative to leverage. Key regulators have implemented specific rules to limit the leverage offered to retail traders as a means of consumer protection.

Here are selected leverage rules according to some important regulators:

SEBI, India:

The maximum leverage for trading FOREX in India is nominally restricted to 500:1. That said, the authority has capped available leverage for major currency pairs at 30:1 and for non-major currency pairs at 20:1. Trading on margin with the Indian Rupee as the base currency is not allowed. Therefore, traders cannot use INR to borrow funds for trading when it is the base currency.

Financial Conduct Authority (FCA), UK: 

30:1 for major currency pairs

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

10:1 for commodities (excluding gold) and non-major equity indices

5:1 for individual equities and other reference values

2:1 for cryptocurrencies

These limits are in place to reduce the risk of significant losses for retail traders.

Swiss Financial Market Supervisory Authority (FINMA), Switzerland:

FINMA has not set specific leverage limits. However, Swiss brokers must adhere to rigorous capital and risk management requirements, ensuring they don't offer excessively high leverage that could endanger their solvency or their clients' funds.

It's worth noting that these rules generally apply to retail clients. Professional or institutional clients might have access to different levels of leverage, depending on the regulatory environment and the broker's policies. As we can see, responsible regulators closely monitor leverage levels. Leverage is a double-edged sword because you can make a lot of money, but you can just as easily suffer heavy losses.

Stop Out and Margin

Perhaps more than any other regulator, SEBI is always actively trying to reduce risks for retail investors. Recent proposals have suggested linking the amount of equity derivatives Indian traders may trade to their net worth. This level of scrutiny arises because the regulator is concerned smaller players could suffer catastrophic losses in volatile derivatives markets. Already, nine out of every 10 retail traders in India lose money.

SEBI closely regulates the use of margin and stop-outs for retail traders in the country. Traders dealing in currencies and intraday trading must keep a 100% margin in the bank account according to a concept called Value at Risk (VaR).

• VaR is defined for each asset. This 100% margin is based on the VaR margin. What does this mean? Simply that you must keep the full amount of capital in your account that is equal to the size of the trade you are placing.

• Then, the maximum leverage a broker can offer for intraday trading would be 20% of VaR, effectively 20% of your 100%.

SEBI has also placed restrictions on the use of intraday profits made by traders to carry out additional trading activities on that same day. The profits can only be used 2 days later for trading activities. Traders must fulfill the minimum margin requirement to carry out intraday trading.

It's worth noting that while stop-out procedures are meant to protect you from negative balances, they can lead to significant losses in volatile markets if positions are closed automatically, especially if the market quickly reverses after the stop out. In the case of India, as soon as your account goes below 100% of the VaR, stop out is initiated and you cannot place the trade. 

As such, using protective measures, like stop-loss orders and not over-leveraging, is always a good idea. Additionally, the specific percentage and the order in which positions are closed can vary among brokers, especially in a tightly controlled market like India, so you need to be aware of your broker's policy on stop-out levels.

Commissions and Fees

Trading fees are not always easy to monitor. Be sure to check how these fees compare with other brokers:

Spreads: In FOREX trading, a spread is the difference between the price at which a trader can buy (ask) and the price at which they can sell (bid) a currency pair. The spread can be categorized into two main types: fixed and variable.

Fixed Spreads: As the name suggests, fixed spreads remain constant regardless of market conditions. They don't change during the day and are generally set by the broker. Fixed spreads are preferred by some traders because they provide predictability, especially during times of high market volatility.

Variable Spreads: These spreads fluctuate based on market conditions. During times of low liquidity or high volatility, variable spreads can widen. However, during times of high liquidity and normal market conditions, the spreads can be very narrow. This type of spread is a direct reflection of market supply and demand.

Why do they differ?

The main reason they differ is due to their reaction to market conditions. Fixed spreads don't react to the market, giving traders a consistent spread cost. On the other hand, variable spreads can offer lower costs during normal market conditions but can widen and become more expensive during volatile times.

Example of Good vs. Worse Spreads for EUR/USD:

A good spread for the EUR/USD currency pair might be around 1.4 pips. This means that if the bid price is 1.1000, the ask price would be 1.10014.

A worse spread could be significantly higher, let's say 3.0 pips or more. In this scenario, if the bid price is 1.1000, the ask price would be 1.1003.

Traders always prefer narrower spreads because the cost of entering and exiting a trade is lower. However, it's essential to consider other factors, like the broker's reliability, platform features, and overall trading conditions when choosing between brokers offering different spreads. This article explains more about this important concept.

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. 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 trading platforms have monthly charges or fees for inactive accounts. Ensure you're aware of these potential costs.

Payments, Deposits and Withdrawals in India

FOREX Trading Customer Service

• Quick resolution of issues
• Educational support
• Assistance with queries during volatile markets
• Account security
• Customized advice (although not all customer service desks offer this)
• Technical assistance
• Regulatory compliance queries.

Technical Aspects of the Broker’s Website

Ask Other Traders on Our Network

When choosing a trading platform, you should consider a range of features that cater to both novice and seasoned traders. Here are some elements to keep in mind:

• Technical analysis tools: The platform should have robust technical indicators to help traders make informed decisions.

• Customization and user interface: Traders should be able to customize the platform according to their preferences, allowing them to set up their trading environment precisely how they want. We find that the products from the MetaTrader suite, especially MT4, offer excellent features for this purpose.

• Platform accessibility: A top-notch trading platform should offer flexibility in terms of access, whether it's web-based or a downloadable application.

• Risk-management tools: Trading inherently comes with risks, and a high-quality platform should provide instruments that allow traders to set stop-losses, take-profits, and other crucial order types.

• Performance and reliability: Beginner traders especially need a platform that operates seamlessly with minimal downtimes or glitches. This ensures a smooth trading journey, allowing them to focus on market movements rather than technical hiccups.

• Learning and educational resources: The best brokers will offer platforms that are not only intuitive, but also come with tutorials, guides, and responsive customer support to assist traders in navigating any challenges they might face.

• Shariah-compliant accounts: Some Indian traders are practising Muslims. If this is you, there should be access to a swap-free account that is consistent with the dictates of Shariah financial law.

To choose the perfect trading platform, here’s some advice:

• Determine your trading style and needs.

• Research different platforms and compare their features.

• Test the platforms with a demo account to see which one suits you best.

• Choose a platform that offers the features you need and is user-friendly.

• Ensure that the platform is reliable and has a good reputation in the industry.

Remember that the trading platform you choose can have a significant impact on your trading success, so it's important to choose wisely.

Online trading offers a wide range of financial instruments, each with its own opportunities and challenges. Here are some of the most common:

• FOREX: this is what you are here for. By now, you will know that FOREX trading involves buying and selling currencies from different countries on the foreign exchange market to make a profit. This is done through a broker with an online platform, like MT4 or MT5. FOREX brokers provide tools to traders for executing buy-and-sell orders in the currency markets.

• CFDs: CFDs allow traders to speculate on the future market movements of an underlying asset without actually owning or taking delivery of the asset. CFDs are traded on margin, meaning the broker allows investors to borrow money to increase leverage or the size of the position to amplify gains.

• Cryptocurrencies: These digital assets are of high interest to traders in India, even if regulators like the RBI are continually trying to introduce regulations to curb the unmanaged trading of these highly volatile assets.

• Equities or stocks: These represent ownership in a company and trading them involves buying and selling shares of publicly traded companies.

• Commodities: Items of value, such as gold, oil, wheat, and coffee, can be traded through a broker or online trading platform.

• Indices: These are a measure of the performance of a group of stocks or other assets. Trading indices involve buying and selling a basket of stocks or other assets that make up the index. Some key international indices include the UK 250 and the Germany 40.

• Bonds: These are debt securities issued by companies or governments to raise capital. When you buy a bond, you are essentially lending money to the issuer, who promises to pay you back with interest later.

• Options: Options are contracts that give the buyer the right, but not the obligation, to buy or sell an underlying asset at a predetermined price and time.

• Futures: These types of contracts obligate the buyer to purchase an underlying asset at a predetermined price and time in the future. This is done through a broker or online trading platform.

To start trading, take note of these vital steps:

• Determine which financial instruments you want to trade

• Research different brokers and trading platforms

• Open a trading account with a reputable broker

• Fund your account and start trading

Remember that trading involves risks, and it's important to have a solid understanding of the financial instruments you're trading and the risks that come with the territory.

You will find that ICM’s ECN account comes with the lowest fees. No matter your trading experience level, there is a pricing tier that caters to your needs.

Will Your Money Be Protected If Your Broker Becomes Insolvent?

1. The FOREX brokerage firm cannot recommend a buy or sell:
2. The FOREX brokerage firm must not provide price or market expectations (rise/fall);  
3. The FOREX firm cannot control your financial dealings (deposit/withdrawal);
4. The FOREX brokerage firm should not “manage” your portfolio under any circumstance;
5. The FOREX brokerage firm cannot grant a client a bonus unless clear terms are guiding it beforehand.
6. The brokerage firm must not use bank accounts not under its name; and
7. FOREX brokerage firms cannot have or offer the service of account managers.

The team at Arincen collected more than 120 pieces of data covering more than 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.     

Afterwards, 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 experience.

The next step saw us evaluate and rank each company, relying on the hard work of 15 Arincen employees. We were very careful to ensure the most accurate assessment possible, including considering 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 final and third survey (referred to here as Survey “3”) to enable participating FOREX companies to evaluate our 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.