Best Forex Brokers in Singapore

Overview of Singapore's top Forex trading platforms

To find the best Forex brokers in Singapore, we created a list of all MAS-authorized brokers, then ranked them by trustworthiness and overall quality, considering factors like fees, platforms, customer support, and available instruments.

Here’s our list of the top Forex brokers in Singapore:

• moomoo SG: Known for its user-friendly mobile app and commission-free trading on stocks.

• CMC Markets: Well-established global broker with a wide range of educational resources and advanced trading tools.

• City Index: Comprehensive platform with diverse markets, including Forex, indices, and commodities.

• ProsperUs by CGS-CIMB: Competitive trading rates and access to Singaporean and Malaysian markets.

• Saxo Markets: Premium trading experience with sophisticated platforms and research tools.

• IG: Global leader in Forex trading with a wide range of currency pairs and excellent customer support.

• OANDA: Reliable and transparent platform with competitive spreads and advanced charting tools.

Forex trading explained

What is Forex trading?

Foreign currency exchange, better known as Forex, is probably not as complicated as it is made out to be. Akin to how you would wait for the best exchange rates at a money changer before swapping your SGD to something else, Forex trading involves trading currencies at the optimal price to turn a profit.

However, instead of just exchanging currency for travel, Forex traders buy and sell currency pairs like EUR/USD (Euro/US Dollar) with the aim of profiting from fluctuations in their relative value. These fluctuations are influenced by a multitude of factors, including global economic conditions, geopolitical events, and even central bank announcements.

All Forex trading platforms offered to Singaporean investors are regulated by the Monetary Authority of Singapore (MAS) to help ensure fair practices and protect traders' interests.

How does Forex trading work?

Forex trading requires you to concurrently buy one currency and sell another via a broker. Essentially, what you’re doing is hedging against the strength of an entire nation’s economy instead of a single company a la the stock market.

In order to do that, currencies are paired. These are called exchange rate pairs (e.g. EUR/USD), where the first currency in the pair is called the "base currency," and the second is the "quote currency”. When you trade a currency pair, you're essentially speculating on whether the base currency will strengthen or weaken against the quote currency.
 
For every currency pair, brokers quote two prices: the bid price (the price at which they'll buy the base currency from you) and the ask price (the price at which they'll sell the base currency to you). The difference between these two prices is called the "spread," and it represents the broker's profit.

Currencies are traded in standardised units called "lots." A standard lot size typically represents 100,000 units of the base currency. However, Forex trading platforms also offer mini-lots (10,000 units) and micro-lots (1,000 units) to accommodate traders with different capital levels.

You can control a larger position with a smaller amount of capital by imposing leverage. For example, with 100:1 leverage, you can control a S$100,000 position with just S$1,000. That said, leverage becomes a double-edged sword: while leverage can magnify your profits, it can also amplify your losses—use it cautiously.

When monitoring the potential profit and loss of your currency pair, the smallest price movement that it can make is recorded as a percentage in point, or pips. For most pairs, a pip is equivalent to 0.0001%.

With these fundamental concepts in mind, it's crucial to select a reliable platform for your Forex trading journey. To navigate the complexities of Forex trading and mitigate risks, it's best to choose a trustworthy and regulated Singapore Forex broker. MAS regulation ensures that your broker adheres to strict financial standards and safeguards your funds.

Why do investors like it?

Firstly, Forex trading can be performed 24 hours a day, 5 days a week because currencies are traded across all financial centres in the world. As one major market closes, another opens, ensuring continuous trading opportunities. You can participate in the Forex market whenever it suits you, regardless of their schedules or time zones.

Furthermore, the Forex market is extremely large, closing at US$11.3 trillion (S$15.37 trillion) as by the end of 2023. This immense size translates to greater stability and less susceptibility to manipulation by individual entities.  Compared to other financial markets, the Forex market's sheer scale offers more opportunities for traders of all sizes to participate and potentially profit.

Lastly, the high liquidity from the colossal trading activity lets traders enter and exit positions with ease. High liquidity means there are always buyers and sellers available, ensuring that you can quickly execute trades at the desired price. This is particularly important for traders who employ short-term strategies or need to react quickly to market events.

Pros and cons of forex trading

Pros:

• You can trade at almost any day and time of the week

• Liquidity is high, allowing you to enter and exit positions easily

• Prices cannot be controlled by a single institution for extended periods of time

• It’s easy to get started, with brokers offering different types of forex trading accounts
  

• Leveraging on Forex trading allows you to control large positions and potentially increase your return

Cons:

• But leverage is a double-edged sword, especially if you don’t fully understand it and don’t have sufficient capital to begin with

• The learning curve is steep, requiring months or even years to study and develop a trading system

• Volatility in the Forex market is high, creating sharp price hikes and drops in a short span of time

Choosing a Forex broker

Regulatory compliance

Before you start Forex trading in Singapore, ensure your chosen broker is regulated by the Monetary Authority of Singapore (MAS). This is non-negotiable. MAS regulation provides a safety net, ensuring your broker adheres to strict financial standards and safeguards your funds. 

Always verify a broker's regulatory status before depositing funds.

Trading costs and fees

Forex brokers generate revenue through various fees, including spreads, commissions, and overnight financing charges. Look for brokers offering tight spreads, especially if you're a frequent trader. 

moomoo SG, for instance, is known for its competitive spreads and commission-free trading on certain instruments.

Platform & speed

Online brokerages with a user-friendly and reliable trading platform will make for a smooth Forex trading experience. Platform responsiveness, charting tools, and order execution speed will inform better trading strategies, while having a mobile app version will make trading more accessible. 

City Index and Saxo Markets are known for their sophisticated platforms with advanced charting and analysis features. If you prefer trading on the go, moomoo SG provides a highly-rated mobile app for convenient access to the Forex market.

Forex pair variety and leverage options

Different brokers offer different selections of currency pairs and leverage options. If you're interested in trading a wide range of major, minor, and exotic pairs, IG and OANDA provide extensive selections. 

When it comes to leverage, assess your risk tolerance carefully. Higher leverage can magnify profits but also increase potential losses. ProsperUs by CGS-CIMB offers flexible leverage options to cater to different trading styles and risk appetites.

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