Forex Trading in Canada

I will speak with my accountant in a few weeks and will definitely report back. On the other hand, Canada does not have any such strict regulations, and traders are free to move their capital to any broker, provided that both the trader, as well as the broker, keeps accurate statements and records of transactions for future verification. Normally, the duration of time one has been certified determines their requirements. Safety and security are key selection criteria when choosing a forex broker. Being distinguished by their main residence and situations, the various Forex brokers might be easily determined by their nationality. Usually you will be able to contact support staff by: Nevertheless, there are a few FX brokers that have set up their offices in Canada to cater to Canadian investors, and some of these branches are from established mainstream companies.

Recommended Canadian Forex Brokers for Canadian Traders. This guarantees that we can promote and showcase the best Forex brokers, safe in the knowledge that you, as a Canadian citizen, are going to get a completely hassle free and first class trading experience.

Top 10 Canadian Forex Brokers

Of course, there are tax benefits and the renewed sense of trust from Canadian traders by getting regulated by a Canadian authority; however, the cost involved in setting up a company from scratch along with a confused Canadian regulatory structure can act as the primary deterrent for brokers. The ultimate aim for any business would be to achieve consistent profits, which can only be gained through a stable marketplace.

The Canadian regulatory structure is still in its primitive phase, and there is a lot of uncertainty surrounding the future course of action regarding the regulation of financial entities. It is also common among Canadian traders to choose international FX brokers according to their trading requirements.

Several brokers have different features and functionalities that are unique to a particular group of traders. Therefore, it is close to impossible for companies to offer various services to a small group of traders, as it is more viable from a business point of view to provide services to traders from an existing platform. Some international regulatory agencies do have an excellent reputation, which ensures that their member firms adhere to all statutory guidelines of FX trading, irrespective of the geographic location of an investor.

Therefore, overseas brokers only need to set up a Canadian presence either through a website or through seasonal presentations and conferences to attract retail traders from that region. Forex brokers in Canada do not follow the same rules as adopted by American brokers.

US Forex trading rules are considered to be highly restrictive, as the US regulatory authorities act as policy makers to prevent their citizens from losing money. Although some regulatory changes of the US help in reducing risk, some are outright against the freedom of retail trading markets.

On the contrary, Canadian Forex brokers do not enforce any trading restrictions; however, the country may change its policies from time to time to ensure that fraudulent financial practices are kept to a bare minimum. Canada is also pretty lenient towards sending and receiving money from international brokers, provided that both the trader as well as the company adheres to all existing anti-money laundering laws.

In the US and several other countries, it is illegal to send funds to overseas FX brokers. The US also enforces strict regulations on international payments due to threats to national security; hence, US citizens have very limited freedom while moving their funds around.

On the other hand, Canada does not have any such strict regulations, and traders are free to move their capital to any broker, provided that both the trader, as well as the broker, keeps accurate statements and records of transactions for future verification. Disregarding the fact that Canadian citizens have the option of choosing any Forex broker of their choice, choosing FX brokers and other related companies in Canada provides unprecedented levels of security of client funds.

The one thing that worries all investors worldwide is the security of funds, as there is a significant chance of a broker going bankrupt due to any unexpected market volatility.

Modern regulators factor in market eventualities while developing their regulatory guidelines, which help in preventing cases of broker insolvency, but no broker is completely safe against liquidation or bankruptcy. Under such circumstances, it makes sense for a trader to choose some of the best Canadian Forex brokers if they wish to trade with large sums of money. Due to the multiple regulatory agencies in Canada and the lack of laws that do not force brokers into setting up an office in Canada, it is indeed difficult to get a large number of choices for Forex brokers from Canada.

Nevertheless, there are a few FX brokers that have set up their offices in Canada to cater to Canadian investors, and some of these branches are from established mainstream companies. There are hundreds of brokers that offer the chance for traders to test the market using a small initial capital and a higher margin requirement.

The maximum leverage has not limit for Canadian traders, as traders can take advantage of even 1: Although it is possible to use a higher leverage, traders are recommended to exercise caution while trading the markets with higher leverage. It is highly recommended to start with a slightly higher initial deposit and a lower leverage.

Canadian regulatory authorities have a highly descriptive set of guidelines that determine broker regulation, which is amended according to new findings and market conditions.

Canada takes inspiration from other regulatory agencies from around the world to create a set of fair trading conditions that are suitable for both brokers as well as traders. Although Canada does not have a centralized regulatory authority for financial entities, the numerous smaller organizations are more than capable of dealing with financial irregularities, and financial malpractice can attract strict sanctions and substantial penalties.

Of course, international and overseas brokers cannot be supervised or controlled, but the Canadian Government is proactive in ensuring that its citizens are made aware of potential scams that may lead to consumer abuse of theft. Would this help me pay less taxes? You should discuss the potential set up of a corporation and the tax implications with your accountant.

It really depends on how much money you are consistently able to leave in the corporation. The lower tax rates for a corporation really only work if you are not drawing out everything you make.

There are other considerations and advantages associated with incorporating beyond tax-sheltering, and some of them play out over very long timeframes I'm mostly thinking about the capacity to income-split and to roll assets over to family members, especially as the corporation winds down.

Of course, you will need to build your own models and get advice beyond an anonymous Internet forum Sponsored Links Remove Advertisements. Professional subscriber fees are something you need to think about when trading under the corporation. Many brokers will have a higher data fee structure or additional ones as the corporation is categorized as a professional account.

Agree with the folks above - talk to your accountant. Another thing to consider is that if you incorporate, any losses have to be applied to income within the corporation. If you are not incorporated, losses can be applied against other income.

Not an issue if you keep making money, but with day trading who what the future holds. Originally Posted by shoichi.

Regulation of Canadian FX Brokerage companies

Jul 04,  · Forex Factory Alexa rank: 1, For a long time now, Forex Factory has been the leading online forum for forex traders, with a huge user base and an established reputation. See a Full List of Forex Broker Companies. These brokers enable traders to enjoy all the benefits of Canadian regulation along with the expertise and popularity that they hold in the international trading . Canadian traders have the luxury of choice when it comes to the brokers they can work with. FX Empire is here to help these traders choose the best Forex brokers in Canada.