Is FXCM 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 FXCM try to check whether it is regulated. Traders Union experts have already done that. In this article, you will learn whether FXCM 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 FXCM
FXCM Markets company incorporated in Bermuda and provides a wide range of financial services for traders almost all over the world. The company was founded in 1999 and registered in Great Britain. It is regulated by the independent nongovernmental organization of Great Britain — Financial Conduct Authority (FCA). Broker’s registered license number — 217689. The FXCM Group has several significant awards such as: prizes in the "Best Trading Tools” category and the "Best Customer Support 2018" by FXEmpire.
💰 Account currency: | USD and more |
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🚀 Minimum deposit: | From $50 |
⚖️ Leverage: | Up to 1:30 *Leverage is a double-edged sword and can dramatically amplify your profits. It can also just as dramatically amplify your losses. Trading foreign exchange/CFDs with any level of leverage may not be suitable for all investors. |
💱 Spread: | From 0.2 pips |
🔧 Instruments: | Currencies, stocks, indices, commodity, cryptocurrency. *Cryptocurrency is not available to UK retail clients. |
💹 Margin Call / Stop Out: | 50% |
Pros and cons of FXCM
👍 Advantages of trading with FXCM:
•wide range of the popular trade tools;
•reliable and reputable regulator;
•the minimum deposit is $50.
👎 Disadvantages of FXCM:
•there is no possibility of trust management and, as a result, no PAMM accounts;
•no incentives/ bonuses offered to clients.
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 FXCM Regulated? Broker’s license
Security (Investors’ Protection)
Information
FXCM is regulated by the British authoritative regulator — Financial Conduct Authority (FCA). Broker’s license number — 217689.
Moreover, the broker is operating other entities that are licensed by the ASIC in Australia (309763), the CySEC in Cyprus (392/20) and the FSCA in South Africa (46534).
👍 Advantages
- The regulations and rules for the financial services provision are on the official website
- In the UK, the relationships between market participants are monitored and regulated by the FCA
👎 Disadvantages
- Complex and longtime complaint procedure
- Claims on compensation for moral damage are not considered
- Claims of traders with small amounts are not considered
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 FXCM, which you can see below.
Traders Union specialists analyzed the FXCM Markets for hidden fees. Please note that the broker charges $40 when withdrawing funds by wire transfer. Also, small amounts can be withheld by banks and payment systems when using other withdrawal methods.
Account type | Spread (minimum value) | Withdrawal commission |
Standard | From $13 | No, except for withdrawal by bank transfer |
Active trader | From $2 | No, except for withdrawal by bank transfer |
Brokers that are similar to FXCM
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 FXCM conditions with its closest competitors.
Comparison of FXCM with other Brokers
FXCM | RoboForex | Pocket Option | Exness | TeleTrade | Tickmill | |
---|---|---|---|---|---|---|
Trading platform |
MultiTerminal, Ninja Trader, MetaTrader4, Mobile, Web, Trading Station |
MT4, MT5, R MobileTrader, R StocksTrader, R WebTrader |
Pocket Option, MT5, MT4 |
Exness Trade App (mobile), Exness Terminal (web), MetaTrader5, MetaTrader4 |
MT4, MT5 |
MT4, MT5, Tickmill Mobile App |
Min deposit |
$50 |
$10 |
$5 |
$10 |
$1 |
$100 |
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 |
No |
Yes |
Accrual of % on the balance |
No |
No |
No |
No |
No |
No |
Spread |
From 0.2 points |
From 0 points |
From 1.2 point |
From 1 point |
From 0.8 points |
From 0 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 |
No |
$30 |
Cent accounts |
No |
Yes |
No |
No |
No |
No |
FXCM is a general purpose-type broker for active traders who trade independently and implement classic strategies in their 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.
TeleTrade is a broker for traders who value the variety of trading instruments and trade using their PC or a mobile app. The company is a good broker both for beginners and experienced traders.
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.
Conclusions
FXCM is a quite reliable broker for trading. FXCM operates on the license of a reliable jurisdiction and its operation is regularly monitored. However, the company does not offer the best trading conditions compared to competitors. You can choose this broker and not worry about the safety of your funds, but there are better options in terms of trading conditions.
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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.
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.