Is SmartFX Regulated? Is it safe? - TU Expert review
License is the most important document you have to consider when choosing a broker. Many traders, who would like to start working with SmartFX try to check whether it is regulated. Traders Union experts have already done that. In this article, you will learn whether SmartFX is regulated, what regulatory authorities supervise the broker and whether it is safe to work with the company in general.
Short summary about the broker SmartFX
SmartFX is an STP broker that was established in 2018. The company holds the brokerage license of the Vanuatu Financial Services Commission (VFSC). The broker offers a single Standard account for trading currency pairs, stock indices, precious metals and energies. Smart FX allows all trading strategies, including hedging, algorithmic trading, Expert Advisors and copy trading.
| 💰 Account currency: | USD, EUR, GBP, JPY |
|---|---|
| 🚀 Minimum deposit: | USD 500 |
| ⚖️ Leverage: | Up to 1:400 |
| 💱 Spread: | from 1.2 pips |
| 🔧 Instruments: | 130 currency pairs, futures, CFDs on stocks, indices, commodities, metals, energies |
| 💹 Margin Call / Stop Out: | 100%/50% |
Pros and cons of SmartFX
👍 Advantages of trading with SmartFX:
•Regulated by an international financial commission.
•Wide selection of trading assets of various classes.
•Spreads at the same level as competitors and not only for majors.
•The broker does not charge non-trading fees for deposit and withdrawal of funds.
•Universal MT5 trading platform (desktop and mobile versions).
•Possibility of trading with leverage.
•Access to passive income options available on MetaTrader: copy trading, script trading and EAs.
👎 Disadvantages of SmartFX:
•The minimum deposit amount is too high for a novice trader.
•No referral program for retail traders.
•No bonuses, cent accounts and quality education.
Why is it important to work with a regulated broker?
License is a document that certifies that a broker operates legally and guarantees fulfillment of its obligations to the traders. A financial license is issued by a financial regulatory authority of a country (the National Bank) or a specialized authority (for example, Securities Commission, Futures Trading Commission, etc.). It is important to choose licensed brokers for the following reasons:
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A license guarantees that the broker operates in compliance with the rules of the financial regulator that issued the document.
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In order to obtain the license, a broker must comply with certain requirements, for example, the size of the authorized capital or personnel qualification. It is simply not lucrative for scammers to comply with such requirements.
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A broker’s license provides access to real markets, and you can be sure that the quotes are real and up-to-date.
The best option is to work with a broker that holds the license of the jurisdiction, where the trader resides. You can also choose a company with a financial license of another reliable jurisdiction, for example, the U.S. or the European Union.
Is SmartFX Regulated? Broker’s license
Security (Protection for Investors)
SmartFX is a brand of Smart Securities and Commodities Limited. It is registered in the territory of Vanuatu and operates in compliance with the law of this country.
The operation of SmartFX is regulated by the Vanuatu Financial Services Commission (VFSC). The broker’s registration number is 40491. The VFSC makes sure that SmartFX complies with anti-money laundering and anti-terrorist financing regulations and services the clients without violating the laws of Vanuatu.
👍 Advantages
- A trader may lodge a complaint with the regulator if the broker violates the agreement
- The VFSC allows its licensees to provide high leverage
- The Vanuatu regulator does not prohibit depositing and withdrawing funds using electronic payment systems
👎 Disadvantages
- The VFSC does not have a compensation fund
- The broker services its clients in compliance with the laws of a small island state
- Identity verification is mandatory to start trading with SmartFX
Brokerage fees
Broker’s regulation is the most important choice criterion. However, before you start working with the broker, it is also important to analyze its commissions and fees. TU analysts have studied the commissions and fees charged by SmartFX, which you can see below.
Analysis of SmartFX commission showed that the broker does not charge non-trading fees. Therefore, the clients can deposit and withdraw funds without paying a fee to the company. SmartFX offers STP accounts, and therefore spread is the only type of Forex trading fees. Its size depends on the type of the currency pair and the market situation. The minimum spread is 1.2 pips on EURUSD.
| Account type | Spread (minimum value) | Withdrawal commission |
| Smart Account | from 12$ | Yes, charged by banks and payment systems |
Brokers that are similar to SmartFX
Many brokers operate legally, obtaining relevant licenses and permissions. However, when choosing a broker, it is important to compare their trading conditions. TU experts have prepared a comparative analysis of SmartFX conditions with its closest competitors.
Comparison of SmartFX with other Brokers
| SmartFX | RoboForex | Pocket Option | Exness | Tickmill | FxGlory | |
|---|---|---|---|---|---|---|
Trading platform |
MetaTrader5 |
MT4, MT5, R MobileTrader, R StocksTrader, R WebTrader |
Pocket Option, MT5, MT4 |
Exness Trade App (mobile), Exness Terminal (web), MetaTrader5, MetaTrader4 |
MT4, MT5, Tickmill Mobile App |
MT4, MobileTrading, MT5 |
Min deposit |
$500 |
$10 |
$5 |
$10 |
$100 |
$1 |
Leverage |
From 1:1 |
From 1:1 |
From 1:1 |
From 1:1 |
From 1:1 |
From 1:1 |
Trust management |
No |
No |
No |
No |
Yes |
No |
Accrual of % on the balance |
No |
No |
No |
No |
No |
8.00%% |
Spread |
From 1.2 point |
From 0 points |
From 1.2 point |
From 1 point |
From 0 points |
From 2 points |
Level of margin call / stop out |
No |
No |
No |
No |
No |
No |
Execution of orders |
Market Execution |
Market Execution, Instant Execution |
Market Execution |
Market Execution, Instant Execution |
Market Execution |
Instant Execution, Market Execution |
No deposit bonus |
No |
No |
No |
No |
$30 |
No |
Cent accounts |
No |
Yes |
No |
No |
No |
No |
SmartFX is a broker that focuses on working with experienced traders that prefer to use the Straight-through Processing (STP) mechanism of trading.
The minimum deposit in RoboForex is $10. Leverage up to 1:2000. Traders choose RoboForex for reliability, favorable trading conditions, minimum spreads, and commission fees. The company is recommended for beginner traders and experienced investors.
Pocket Option offers a wide range of trading instruments and copy trading services. It constantly improves its service quality and expands the list of assets and trading platforms. The broker is suitable even for novice traders without significant capital due to the low initial deposit. Experienced traders who work with CFDs and binary options can also use Pocket Option’s services.
Exness broker is a trusted broker partner that is compliant with all relevant terms. Exness complies with all payment obligations and pays money earned.
Tickmill is a suitable broker for both professional traders and novices. The company is good for robotic trading as well as for short-term strategies.
FxGlory is a universal broker for active trading that is likely to be interesting for European traders.
Conclusions
SmartFX cannot be considered absolutely reliable. The broker operates on a license of an offshore regulator. This creates certain risks regarding security of your funds. The broker has a good reputation. However, you can work with companies with an offshore regulation only at your own risk.
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FAQ
How difficult is it to obtain a brokerage license?
The procedure for obtaining a license differs depending on the jurisdiction, but it is very difficult and expensive to get the document in a reliable jurisdiction. This is why only reliable brokers obtain licenses.
Why is it not recommended to work with offshore brokers?
Offshore brokers have to meet minimum requirements for obtaining a license and reporting, which is why often scammers get such licenses.
Can an offshore broker be reliable?
Yes, although there are not many of such brokers. There are brokers with a good reputation, but with an offshore license. You still need to be very cautious when working with such companies.
How do I check a broker’s reputation?
In order to check a broker’s reputation, you need to read user reviews. However, it is recommended to only use independent websites for that.
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Team that worked on the article
Mikhail Vnuchkov joined Traders Union as an author in 2020. He began his professional career as a journalist-observer at a small online financial publication, where he covered global economic events and discussed their impact on the segment of financial investment, including investor income. With five years of experience in finance, Mikhail joined Traders Union team, where he is in charge of forming the pool of latest news for traders, who trade stocks, cryptocurrencies, Forex instruments and fixed income.
Olga Shendetskaya has been a part of the Traders Union team as an author, editor and proofreader since 2017. Since 2020, Shendetskaya has been the assistant chief editor of the website of Traders Union, an international association of traders. She has over 10 years of experience of working with economic and financial texts. In the period of 2017-2020, Olga has worked as a journalist and editor of laftNews news agency, economic and financial news sections. At the moment, Olga is a part of the team of top industry experts involved in creation of educational articles in finance and investment, overseeing their writing and publication on the Traders Union website.