Forex Trading in Australia 7


The Australian Forex Capital Market is flourishing and many traders and enthusiasts are looking to take part, with broker companies constantly extending the client base. With the business being as appealing and risky as it is, traders need to be looking for good broker management and nationally regulated companies.

Administering the Market

Australian Securities & Investments Commission (ASIC) is a government body and the national broker authority implementing the laws regulating the brokers and generally protecting the investors and consumers in financial services at hand. The broker companies regulated by ASIC have to comply and follow a number of requirements including regular external audits of Forex broker books and having a separate account for clients’ deposits.

For obvious reasons, ASIC thus provides protection and safety to traders while supervising and regulating the Australian brokers who continuously get to gain the trust of their existing and new clients.

Choosing a Successful Forex Broker

Australian traders can experience challenges because of the actual distance from the financial centers, and if there are any ISP issues this often causes obstruction and frustration with the customers. This practically means you would be looking for a broker with a fiber connection directly to a financial center – preferably New York – and combining it with a good and reliable ISP.

This also means that you’d want the broker company to have exceptional customer support! Most of the Australian Forex brokers have good customer support, as well-trained staff is one of the ASIC requirements, but you’d want to choose brokers offering committed customer support service including a live chat, e-mail, as well as telephone available 24/7. Of course, you’d be looking at polite and patient as well as knowledgeable service.

From a broker of your choosing, you’ll also want to provide popular trading platforms, dominant spreads, commissions and leverage as well as fast execution rates.

What to Look Out For

Exploring the potential broker companies, there’s a lot of useful information you can find by listing the customer reviews as well as ASIC website. You should always look out and take your time defining quality options and the traits they offer. Except for above mentioned regulation from the national authorities and the importance of good customer support, there are more important aspects to choosing your broker.
 

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Trading Platforms and Accounts Types

The trading platforms are usually independent and high quality, but there are brokers offering their platforms too. The platform is one of the most important elements of your decision and a good platform will have all currency pairs available, trader history and history of trends, as well as a Stop Loss option included which could save you big money in case of a downfall. Most of the brokers will offer more than one platform for you to choose from, which is a preferable option especially for the beginners developing their style.

Most brokers in Australia offer different types of accounts including Demo accounts for practicing, standard accounts for real money investing and VIP accounts for professionals and experienced traders.

Demo accounts or sometimes called practice accounts are essential for beginners, as they provide you with a chance to test the market and your skills, often without a deposit. This is a great asset you should be looking for with your potential broker.

Spreads and Leverage

The spread is the difference between the bid and its ask price. You would aim to find a broker offering narrow spreads to reduce big potential losses as much as you can. You will be looking for wide-spread offers when you are more advanced trader to get a chance to earn more money. An important thing to note is that there are broker companies asking for a fee for every transaction you make. While some brokers taking deposit and withdrawal fees too, some brokers only charge the actual spread.

When it comes to leverage, most of the Forex brokers in Australia offer more than decent options, going as high as 1:500. While this is a great method for traders to make huge profits, it is also rather risky and we would recommend not using it while you are in the beginning stages of your trading career.

Cash and Payout

It’s important to explore the deposit and withdrawal methods and speed. You will always look for the brokers offering fast, usually same day or payouts within 24 hours.

Ideally you would also look for no deposit/withdrawal fees and of course deposit bonuses, so it’s important to check all the available options.

Understanding the Risks

Forex trading of course brings risks you have to be aware of if you’re willing to take advantage of the market. Best advice you can take is never to trade more than you can actually afford. You can always loose more than you have initially deposited, and it’s important to reduce the risks as much as possible and there are several ways you can do that.

Firstly, do not trade more currency pairs than you can follow. This would be a rookie mistake and can lead to a downfall, especially in the beginning phases of your trading. You should then always trade in high-liquidity currencies, and start with short spread. Although, there is never certainty, this minimizes the risks of a downfall in case of unfavorable market conditions. It’s important to have a short market watch list, understand the constant and on-going market changes and time your investments and withdrawals correctly.


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7 thoughts on “Forex Trading in Australia

  • Mark Hyde

    My favourite Australian broker is Pepperstone. I am with them from over a year. They offer very tight spreads especially for major currency pairs. The thing that I like the most about this broker is that they do not give slippage when you trade in normal market conditions. Trade execution is very fast and smooth and you really enjoy trading their mt4 platform. Pepperstone customer support is best in the industry and they provide 24 hours live customer support and their agents are very supportive and provide you information about everything quickly. Their withdrawal process is also very fast and normally they process withdrawals within 1 day.

  • Bob Warren

    As Australian, my favorite broker is Global Prime for numbers of reasons. Their customer support is best and solves all your problems. They offer an amazing variety of currency pairs to trade. They also offer number if currency pairs which are not normally offered by book brokers. I am trading with this broker for a few years and I am really satisfied with almost everything. Their mobile and desktop platform is wonderful and also offer a lot of options for deposits and withdrawals like e-wallet service which is very good for me as a trader, so I give 5 stars to this broker.

  • Dean

    Australia is one of the fastest growing markets for forex brokers so many Australians are doing forex trading now and to capture business from these traders many brokers have started focusing on the Australian market and opening the local offices. My fav broker is global prime because it’s a local Australian broker and it focuses more on traders from Australia. That’s why they offer services according to the needs of local Australian trader.

  • James King

    Pepperstone is the best broker in Australia and they are marketing very aggressively. I read somewhere that at the moment they are the 11th largest forex broker in the world. They are the most popular broker in Australia and I love their service. They are offering more and more trading items to trade and also some other options for traders which are very attractive. I think at the moment pepperstone is ruling Australian market and no one can beat them in near future

  • pipsmaster.70@yahoo.com

    Pepperstone is not only the best broker for Australian traders but today it’s also one of the best brokers in the world. They offer one of the tightest spreads in the industry. I have been trading with this broker since last 1 year and I feel this is one of the top 5 brokers in the world. Everything with this broker is so good. They offer best spreads, best customer support and they are also very professional. I love this broker and I am proud that I am working with this broker.

  • Bubble gummers

    i know so many traders in USA are going after Australian brokers because of the strict regulations in USA a lot of American traders are looking for overseas brokers. USA regulated brokers do not offer good leverage and also have very strict regulations for USA traders. That’s why traders from USA are running after other brokers and Australia is one of the favorite choices because of the good regulatory body and also due to the fast booming Australian economy. Many USA traders are opening offshore companies and are opening accounts with Australian brokers like perperstone and global prime. Australian brokers are also giving very good services so in my opinion Australian forex markets and brokers are growing very fast and this trend appear to remain same for many coming years.

  • Dean

    Australia is one of the fastest growing economies in the world and also lot of forex brokers are targeting customers in Australia. The brokers I like are Pepperstone and global prime. Both these brokers provide excellent service and good trade execution. I have been trading with Pepperstone since last 2 years and I am very happy.