- About Forex Broker Germany
- Best Germany Forex Brokers List
- 1. Windsor Brokers
- 2. Pepperstone
- 3. Tickmill
- 4. BDSwiss
- 5. CMC Markets
- 6. Alvexo
- 7. FXFlat
- 8. FXGM
- 9. IG Europe
- 10. Plus500
- Is Forex Trading Legal in Germany?
- How Do I Trade Forex in Germany?
- Choosing The Best Forex Brokers in Germany
- Pros and Cons of Forex Trading
A forex broker, in general terms, is a financial company that offers traders full access to various trading platform options to buy and sell foreign currencies. Forex trading stands for foreign exchange trading and every transaction in forex markets is between pairs of currencies.
A foreign exchange broker is also known as a currency trading broker or retail forex broker. The clients include retail traders of currency who use the trading platform to speculate on the currencies direction. The clients of a forex broker may also include financial and trading services companies that trade under investment banks or other clients.
Note that CFDs are quite complex and come with a high risk of losing money because of their leverage. Most retail investor accounts lose money when they trade CFDs. Hence, you should comprehend the terms and conditions of how CFDs work and whether you can afford to take the high risk of losing your money.
About Forex Broker Germany
German forex traders and brokers constitute a huge portion of Forex traders in the world. Despite the many economic setbacks that Germany and the world faced in 2008, the economy bounced back and proved to be one of the strongest and healthiest economies in the world.
The Forex trading sector is booming with the growing financial sector in Germany. There are no legal provisions for German forex trading and the local brokers are mostly reliable and regulated. With so many top forex brokers list in the economy, it becomes extremely difficult to identify reliable and trustworthy brokers since there is a high risk of losing money while trading CFDs. This article makes things about forex trading crystal clear and focuses on many aspects of the best forex brokers in Germany, including pros, cons, and more.
List of the Best Forex Broker Germany
- Windsor Brokers:- Best For CFD and Forex Trading
- Pepperstone:- Best For Advanced Features & Trading Experience
- Tickmill:- Best For Active & VIP Traders
- BDSwiss:- Best For Beginners As Well As Experienced Traders
- CMC Markets:- Best For Range of Offerings
- Alvexo:- Best For MT4 Platform
- FXFlat:- Best For Financial Instrument Offerings
- FXGM:- Best For Protecting Client’s Investments
- IG Europe:- Best For Trading Platforms Offerings
- Plus500:- Best Broker for Beginners
Best Germany Forex Brokers List
Established in 1988, Windsor Brokers is an established CFD and Forex trading broker in Germany. With the two arms combined, one in Belize and another in Cyprus that is regulated by the JSC, IFSC, & CySEC. Windsor Brokers manages to offer trading services for traders in more than 80 countries including Indonesia, South Africa, Thailand, Malaysia, Kenya, Iran, and Dubai.
Windsor Brokers Features
|Regulated By||JSC(BZ), IFSC(BZ), CySEC|
|Best For||Best For CFD and Forex Trading|
|Minimum Deposit||$100 for Prime Account |
$2500 for Zero Account
|Maximum Leverage||250:1 (Metals); 500:1 (Forex); 200:1 (CFD & Spot Indices); 100:1 (CFD & Spot Energies); 250:1 (Treasuries); 50:1 (Commodities); 20:1 (Shares)|
|Tradable Assets||Forex, Indices, Shares, Commodities (BZ only), Treasuries (BZ only), Metals (BZ only)|
However, it does in-depth analysis of price movements with 30 in-built technical indicators, its signal services allow copy trading, and there are three modes of execution, including pending and instant orders. Apart from this we can say that it does not provide a “no deposit” account.
Pros and Cons of Windsor Brokers
|Licensed by reliable financial authorities such as CySEC.||Binary and cryptocurrency options are unavailable.|
|Leading trading platforms including MetaTrader4 with great customer support service.||Below-par live chat function.|
|Rich educational library.|
|Protection against negative balance.|
Several payment options are available with Windsor Brokers but the transactions often cost a 3% fee. Likewise, there are withdrawal fees too fixed at £3 of 3% fee per deposit and withdrawal. Traders trading in Germany can open two types of accounts – a Prime account and a Zero MT4 account. The Prime accounts offer no commissions, low minimum deposit, and useful training sessions to educate traders with trading skills.
On the other hand, the Zero account is suitable for seasoned traders and it offers a low spread starting at zero pips. However, it charges a higher commission of $8 for every round trip. There are no “no deposit” options. You should consider whether this is suitable for you. You should consider whether you want to go ahead and trade.
Pepperstone brokers is a popular broker for forex and CFDs. It is based out of Australia and regulated by leading financial institutions including the ASIC. Pepperstone was established in 2010 and despite being a relatively infant broker, it has expanded exponentially in recent years to become one of the best forex and CFD brokers worldwide.
|Regulated By||FCA, BaFin, ASIC, CMA, SCB, DFSA|
|Best For||Best For Advanced Features & Trading Experience|
|Minimum Deposit||$200 or £200|
|Maximum Leverage||30:1 (Europe, Dubai, Australia); 500:1 (Pro Accounts & Other Markets)|
|Tradable Assets||Forex, Precious Metals, Soft Commodities, Energy, CFDs, Cryptocurrencies|
The firm was established in the city of London in 2016 and has multiple European clients. It is also regulated by BaFin (Federal Financial Supervisory Authority), by the Financial Conduct Authority, and the European Securities and Markets Authority. The Financial Conduct Authority is also known as FCA. The company is also regulated in Kenya and Dubai, several Middle Eastern and African countries.
Pepperstone brokers require traders to maintain a minimum deposit. Unlike other top forex brokers in Germany, Pepperstone limits itself in terms of the availability of tradable products. Forex trading is the backbone of the firm. It is also a broker for other financial instruments including precious metals, soft commodities, energy, CFDs, and cryptocurrencies.
Pepperstone provides different account types, free of commission and also regulated by several leading financial authorities. However, it is renowned for fast execution, low spread, & high competitiveness and also provides demo accounts and allows copy trading. Although, know more about the platform from a review of pepperstone that is well researched & honest.
Pros and Cons of Pepperstone
|Fully digital and fast account opening procedure. The account opening process is highly convenient.||Mostly offers CFDs.|
|Above-par and efficient customer service.||MT4 trading platform is quite basic.|
|Free and seamless deposit and withdrawal.|
|About 107 currency pairs with 0.0 pips spread.|
Pepperstone is popular for not charging any internal fee on deposits and withdrawals. However, certain external fees may be charged. Spreads are also variable. This can be an excellent indication of the firm’s commitment since it offers its clients the best possible prices while the value may drop to 0 pips when the market is liquid.
Different accounts offered by Pepperstone broker has different benefits in terms of spreads, fees, and commissions:-
- The standard account has $0 commission with institutional level STP spreads.
- The Razor account has 0.0pips spreads.
- A swap-free account is interest-free with STP spreads and $0 commission.
- Active traders account has 0.0pips spreads and the setup is specially designed for institutional and high volume traders.
Tickmill broker is a prize-winning ECN forex broker that offers trading in indices, commodities, and trading. Tickmill Limited is a subsidiary of the international Tickmill Group that has multiple age-old trading companies. Currency, the firm runs in more than 200 countries with a trading volume of over 121 billion per month.
|Regulated By||FCA, CySEC, LFSA, FSA|
|Best For||Best For Active & VIP Traders|
|Minimum Deposit||For Pro & Classic Accounts – $100 |
For VIP Accounts – $5000
|Maximum Leverage||500:1 (Stock Indices, Bonds, Oil); 100:1 (Forex, Metals)|
|Tradable Assets||Forex, Stock Indices, Commodities, Bonds|
Tickmill is headquartered in London and operates multiple offices across the world with clients from South Africa, Indonesia, Estonia, Tanzania, Australia, Vietnam, and Malaysia. The firm is hugely popular for its ease of dashboard customization, the suite of trading features, and easy navigation on the leading forex and CFD trading platform, MetaTrader4.
The broker firm is best known for charting tools, EA trading, historical data, having over 50 indicators, advanced system for notification, and order & trading management tools.
Pros and Cons of Tickmill
|Scalping and hedging.||Cryptocurrency trading unavailable.|
|Several promotional offers with great customer support.||No MT5 trading platform.|
|A plethora of educational and resource tools.||No Micro or Cent account.|
|Availability of demo account.|
The Classic account at Tickmill is free of commissions. The spreads are variable and start from 1.6 pips. For VIP and Pro accounts, the spreads start at 0 pips and the commissions are low. Low commissions are attractive for traders.
The deposit and withdrawal fees may go up to $100. However, the dormant accounts are charged a fee, known as an inactivity fee.
BDSwiss was established in 2012 in Zurich and currently, the firm has over €20bn in foreign exchange trading per month. It is an international provider with more than 16000 affiliated accounts. BDSwiss is regulated and licensed by the EU’s CySEC (Cyprus Securities and Exchange Commission), the FSC, and the United States National Futures Association.
|Regulated By||CySEC, FSA, FSC|
|Best For||Best For Beginners As Well As Experienced Traders|
|Minimum Deposit||No Limit|
|Maximum Leverage||400:1 (Forex Trading); 300:1 (Commodities)|
|Tradable Assets||Forex, Indices, Shares, Commodities, Cryptocurrencies, CFDs|
BDSwiss Group includes BDSwiss LLC, BDSwiss Holding plc, BDSwiss GmbH, and BDS Markets. Its partners or business affiliates are allowed to access its services, community forum, and the knowledge base on its trading platform.
Here, traders can trade a wide range of tradable assets including Forex, indices, shares, commodities, and even cryptocurrencies. Traders can choose from major currency pairs CFDs, a few exotic pairs, and minor currencies to trade in forex markets.
BDSwiss trading platforms are best known for their wide range of commodities, equities, and cryptocurrencies. It is a broker for beginners and experienced traders. The platforms are extremely straightforward and easy to use for beginners as well as high-volume seasoned traders. The regular trading seminars are quite useful for beginners who want to learn about day trading.
The impressive charts and indices for trading, in either Line or Candlestick format, are fully customizable and forex traders also get many advanced features for decision-making and technical analysis. Although, check our researched BDSwiss review in detail and know in-depth information about the platform.
Pros and Cons of BDSwiss
|Strictly authorized and regulated by 3 leading entities.||Limited cryptocurrencies available.|
|Reliable and trustworthy trading conditions with great customer support.||Canadian and US clients are not allowed.|
|Several financial instruments to trade with.|
|Offers many trading platforms.|
Though there is no limit on deposit and withdrawal amounts, BDSwiss often charges 10 Euros on deposit amounts of 100 Euros through bank transfers and the minimum withdrawal limit through bank wire transfers is 50 Euros, which includes a 10 Euro fee.
Indices and forex pairs have different spread values assessed by their pip values. The spreads may change depending on the market volatility and conditions.
BDSwiss charges a small commission of 0.1% on stock CFD trading, but this is quite low compared to the average industry rate.
Established in 1989, CMC Markets is one of the oldest financial trading companies in Germany. It offers CFDs and spreads betting to major international trading markets. Currently, it has more than 80,000 active clients, over thousands of financial instruments, and a trading volume of 65 million per year. CMC Markets offices are located in Frankfurt and it is regulated and licensed by BaFin under the registration number 154814.
CMC Markets Features
|Regulated By||FCA, ASIC, MAS, IIROC|
|Best For||Best For Range of Offerings|
|Minimum Deposit||No Minimum Deposit Policy|
|Tradable Assets||Forex, Commodities, Indices, Shares Baskets, Shares, Treasuries, Cryptocurrencies|
Apart from spread betting, Forex, and CFD trading, CMC markets also offers a robust and versatile Next Generation trading platform and a high-quality mobile app that eases mobile trading for all traders. However, check our CMC Markets forex review to know all its services in detail.
CMC Markets is regulated by many financial authorities like Financial Conduct Authority (FCA), the Australian Securities and Investments Commission (ASIC), MAS, and IIROC.
CMC Markets has a no minimum deposit policy. However, traders need to maintain a required margin in their trading account to open a position. But the trading account can be created with any initial or minimum deposit amount.
The firm is best known for offering more than 11,000 financial instruments and the Next Generation trading platform that can be accessed from any web browser. Traders have been extremely impressed with its easy-to-navigate and sleek user-friendly interface.
Moreover, the ticket design is quite simple and traders can add limits and stops and check the depth of pricing. Additionally, CMC Markets allow traders to decide between normal stop-loss, guaranteed stop-loss, and trailing stop-loss orders.
Pros and Cons of CMC Markets
|Low forex trading fees with fast account opening process.||High CFD stock exchanges fees.|
|Great web platform as well as a mobile platform with user-friendly interface.||Limited portfolio.|
|Advanced educational and research tools.|
|Fully functional and free demo account.|
|Effective and responsive customer support.|
CMC Markets does not charge a range of extra trading fees from traders. The CMC fee structure is fairly transparent. There are specific position thresholds that vary based on the financial instruments one trades with. With these thresholds, CMC provides a guaranteed stop-loss order but to use this service, there is a premium that is ultimately refunded if the stop-loss order does not trigger.
CMC Markets offers impressive minimum spreads. For instance, it is 0.7 pips for currency pairs USD/JPY and EUR/USD while an additional 1 point for FTSE 100 for the United Kingdom and Dax 40 for Germany. In general, one can expect a usual spread of 0.8 pips.
Alvexo is one of the best forex brokers Germany. Established in 2014, it offers a variety of retail investor accounts, varied knowledge, and educational resources, mobile platform, and tradable assets. It is owned by Safe Financial Group Ltd and headquartered in Limassol, Cyprus.
|Regulated By||FSA, CySEC|
|Best For||Best For MT4 Platform|
|Minimum Deposit||Classic Account Holders – $500, |
ECN or Gold Account Holders – $2500
Prime Account – $10000
|Maximum Leverage||300:1; 30:1 (For European Traders)|
|Tradable Assets||Forex, Shares, Commodities, Indices, Cryptocurrencies |
ECN VIP Accounts can Also Trade on US and European Stocks
The firm boasts more than 450 financial instruments and has more than thousands of clients worldwide, from UAE to Singapore and France. Alvexo is officially partnered with Norwich City and it is registered with the CySEC and the FSA of Seychelles.
The minimum deposit requirement at Alvexo is based on the account type held by traders. Clients trading with Alvexo brokers can trade in the following financial markets like forex, shares, commodities, indices, and cryptocurrencies. It is important to note that traders with ECN VIP accounts can trade US & European stocks.
The broker firm is popular for its MT4, web, and mobile platforms. The features included in the MetaTrader 4 trading platform are:-
- 9 timeframes and 30 technical indicators
- Chart and graph tracking
- Customizable tools
- Multiple types of orders
- Real-time notifications and alerts
- Market signals
- Instant execution
Pros and Cons of Alvexo
|Wide range of markets and assets.||High minimum deposits.|
|FSA and CySEC regulated.||No MT5 trading platform is available.|
|Several options of retail investor accounts.|
Deposits and withdrawals are free of cost. It is free of charge. This free of charge service is an attractive one. The broker does not charge any deposit or withdrawal fees. Prime, Classic, and Gold members get to enjoy a commission-free fee structure. But there are other costs that include swap fees on the positions left overnight and inactivity fees of 10 units on the base currency.
Established in 1997, FXFlat is a German Market Maker brokerage firm offering CFDs, Forex, futures, and cryptocurrencies on the mobile platform, Trader WorkStation, MT 4 and MT 5 platforms. The firm also provides a variety of payment methods starting from PayPal, credit cards, to bank transfers and cryptocurrencies.
|Best For||Best For Financial Instrument Offerings|
|Minimum Deposit||TWS Account Holders – €2,000 |
Metatrader Account Holders – €200
|Maximum Leverage||30:1 (Forex Trading); 20:1 (Indices and Gold CFDs); 5:1 (Stock CFDs); 20:1 (Commodities); 2:1 (Cryptocurrencies)|
|Tradable Assets||Forex, Indices, CFDs, Shares, Commodities, Futures, ETFs, Cryptocurrencies|
FXFlat holds a license with the BaFin or Federal Agency for Financial Services Supervision and it is also regulated by it in Germany. Additionally, traders have full access to a range of financial instruments available on the platform There are additional add-ons such as OptionTrader, AgenaTrader, and SpreadTrader for various user preferences.
Traders at FXFlat get to choose between Professional FXFlat and Standard FXFlat accounts in both TWS and MetaTrader 4/5 platforms. The minimum deposit required by TWS account holders is €2,000 and the account offers stocks, futures, CFDs, options, spot forex trading, and many more options. The MetaTrader account holders are required to maintain a €200 min deposit and the account offers access to futures, forex, and CFDs only.
FXFlat is best known for multiple trading platforms including MetaTrader 4, MetaTrader 5, and Trader WorkStation (TWS). It also includes an impressive financial instrument selection of more than 50 forex currency pairs and 11 spot pairs. However, it also supports mobile trading, social trading, and offers many other trading services. Not many brokers support social trading as social trading is an emerging area.
Pros and Cons of FXFlat
|Trader WorkStation, MetaTrader 4 and 5.||Confusing & interface which is not user-friendly.|
|Additional add-ons and tools.||Webinars and videos are available in German only.|
|Range of financial instruments with quick account creation process.|
|Regulated and licensed by BaFin.|
Spreads at FXFlat are quite competitive at about 0.8 pips for the major currency pairs including EUR/GBP and EUR/USD. The indices are about 1 point for US 30 and FTSE 100 while the spot gold is about 0.3 pips. All in all, these spreads are decent but not very competitive compared to other brokerage firms.
There may be some commissions too, applicable on certain trading instruments and based on which trading platform is being used to trade. For instance, the commission on TWS is €1.90 for US 30 and DE 30 indices and about €3.50 for currency pairs EUR/USD. Additionally, there is also a swap rate applicable to overnight positions but the rate varies based on the position size and the pair being traded.
FXGM is an international broker offering CFD, forex, and cryptocurrencies on its trading platforms. The brand Depaho Ltd owns the FXGM broker firm and regulated by the CySEC (Cyprus Securities and Exchange Commission) as well as the FSCA (Financial Sector Conduct Authority).
|Regulated By||CySEC, FSCA|
|Best For||Best For Protecting Client’s Investments|
|Minimum Deposit||For Global FXGM -> VIP – $30,000, Diamond – $15,000, Gold – $10,000, Silver – $5,000, Discovery – $2,000, Basic – $200 |
For FXGM ZA -> Royal – $100,000, Executive – $50,000, VIP – $30,000, Premium – $10,000, Junior – $200
|Maximum Leverage||For FXGM ZA -> 200:1 (Forex, Silver, Gold, Oil); 100:1 (Indices & Other Commodities); 10:1(ETFs, Cryptocurrencies, Stocks) |
For Global FXGM -> 10:1 (Synthetic Derivatives); 50:1(Coffee)
|Tradable Assets||Global FXGM -> FX Spot, Commodities, Commodities Spot, Shares, ETFs, Indices, Synthetic Derivatives, Cryptocurrencies |
FXGM ZA -> Forex, Stocks, Indices, Commodities
The firm runs its services in the states of the EU, including Sweden and other locations like Switzerland, Ukraine, and South Africa. However, FXGM ZA is a South African brand and has a separate portal and trading platform for all kinds of traders, for beginners as well as seasoned traders.
FXGM trading platform is best known to protect its client’s investments by using an Autochartist tool which is a technical feature that enhances the trading experience by offering the following benefits:-
- Offers probability filters that carefully monitor the previous performance and market events.
- Analyzes the chart patterns, resistance, and support.
- Provides regular market updates.
Potential traders must note that popular platforms such as MetaTrader 4/5 are not supported by FXGM.
Pros and Cons of FXGM
|Full-featured mobile app.||No demo account.|
|Wide variety of tradable asset classes.||No MetaTrader 4/5 integration.|
|Strictly regulated by two leading financial bodies.|
|Different types of accounts for different investors.|
FXGM brokers provide tight spreads over various asset classes such as USD/EUR and are offered at 0.3 pips. There is also a rollover fee charged at 0.015% by the global firm and at 0.1% by FXGM ZA. The global firm also imposes an inactivity fee of €150 per quarter and it increases to $500 at the ZA firm.
IG Markets broker firm is one of the biggest forex brokers operating in Australia, the UK, the USA, South Africa, Dubai, Singapore, and New Zealand. It offers CFD trading in all the markets but share trading is available only in England and Australia.
IG Europe Features
|Regulated By||FCA, ASIC, FSCA, FMA, NFA, BaFin, FINMA|
|Best For||Best For Trading Platforms Offerings|
|Minimum Deposit||$450 and No Minimum Deposit for Bank Transfer|
|Maximum Leverage||250:1 or 200:1 (Australian Retail Investors); 20:1 (UK, South Africa, & European Investors)|
|Tradable Assets||Forex, CFDs, Shares|
To open an account, most traders sign up with the IG trading account that gives access to all the basic features. For specialized trading features, traders require an alternate account.
The broker firm was established in 1974 and it is one of the oldest trading firms having 178500 retail clients from across the world. IG Markets follows strict standards of trading and runs under the rules and regulations of the top-tier regulatory agency. Although, just check our honest IG forex review and know more about it.
IG Group is regulated by some of the leading tier-one regulatory and licensing bodies. Although, the minimum deposit required at IG Markets differs based on the payment methods. The min. deposit is $450 if the chosen payment methods are credit cards, debit cards, or PayPal while investors who use bank transfer can enjoy the no minimum deposit policy to open an account at IG. The minimum deposit for spread betting or trading with IG is also $450 or its equivalent in any local fiat currency.
The IG Markets broker firm is popular for offering three specialist trading platforms:-
This trading platform is perfect for forex traders willing to trade shares across the world through a CFD broker. L2 Dealer is a more advanced trading option for those who want to trade both Shares and CFDs.
ProReal Time trading platform enables investors to develop strategies by using development tools that can either be coded from scratch or readily available on the platform.
MT4 trading platform is quite popular and available on almost every trading platform today and this is because of its simplicity, its fast execution speed, and its ability to enable investors to customize according to their needs.
Pros and Cons of IG Europe
|Fully featured and digital.||Account opening takes significant time|
|Very low min. deposit.||Low level of security.|
|Bank transfers have no min. deposit.|
|Easy for beginners.|
|Access to more than 80 currency pairs.|
IG mostly has the average CFD trading fees. Stock CFDs have high fees of around $15 or £10. There are no rolling fees, swap fees, deposit, or withdrawal fees. However, an inactivity fee of $12 is charged per month but only if the account remains inactive for more than 2 years.
Plus500 is a leading CFDs (Contract for Difference) trading platform, owned, and operated by a holding firm, Plus500 Ltd. The firm is synonymous with safety and reliability. This is because Plus500 and its subsidiaries are licensed and regulated by the leading jurisdictions in the world. Additionally, it is also a sponsor of professional Rugby and Soccer teams.
|Regulated By||FCA, CySEC, ASIC|
|Best For||Best Broker for Beginners|
|Maximum Leverage||30:1 (Professional Accounts); 2:1 (Cryptocurrencies)|
|Tradable Assets||Forex, CFD, Stocks, Options|
Plus500 is regulated by the Financial Conduct Authority (FCA), Cyprus Securities and Exchange Commission (CySEC), and the Australian Securities and Investments Commission (ASIC). The minimum deposit for all customers and account types is fixed at $100. And the assets that can be traded on the Plus500 trading platform are forex, CFD, stocks, and options.
Plus500 offers high levels of reliability and efficiency. The digital Webtrader platform is able to operate and execute trades at a faster speed. Moreover, there are a wide range of trading assets to choose from and the demo account provides a great opportunity to discover the platform and back-test its strategies using historical data. Apart from this, you can also check here for more details about the brokerage platforms services in detail.
Pros and Cons of Plus500
|Easy-to-use and navigate.||Limited range of products.|
|Fast account opening process.||Research tools are below-par and mediocre.|
|Helpful and efficient customer support service.|
|No trading fees.|
There are no minimum deposit and withdrawal fees or commission charges on the Plus500 trading platform.
Is Forex Trading Legal in Germany?
Forex trading is legal in Germany and highly regulated by the BaFIN authority. There is no law governing forex trading and it is the objective of the European Union to integrate the Eurozone and the regulated brokers in the member states to accept and market to German traders.
This implies that every German trader can work safely with MiFID compliant brokers in Germany. MiFID is a regulation covering trading around the entire Eurozone. A German trader must choose a MiFID compliant broker to trade with or any other broker that is licensed and regulated in the EU.
How Do I Trade Forex in Germany?
Forex trading in Germany means buying and selling (transactions) currency pairs. One party buys and the other party sells. The main goal of forex trading is the speculation on the price movement of a currency pair. Hence, the traders are not saving while trading in Germany or investing but speculating on the currency’s price movements with the hope of gaining only if the pair moves in the right direction as forecasted.
Specialized trading forex platform treats currency pairs as financial instruments. The user purchases a particular number of “lots” – the base currency’s unit – and the sale of an equivalent value of the currency occurs. For instance, in the USD/EUR currency pair, a trader purchases USD price in terms of Euro and this is because he supposes that the currency price may rise in the future.
One thing should be kept in mind while forex trading and that is despite knowing everything about trading currencies, the quoted currency’s value is never physically obtained in such markets and forex trading. This means when a trader trades USD/EUR pair, he is not actually buying USD to spend on something in the United States. No trader actually obtains the money value of Euros, Dollars, or any currency. Forex trading only focuses on the currency pairs and tries to forecast their price movements for the traders to make profits with the most accurate ones.
Choosing The Best Forex Brokers in Germany
BaFin or Bundesanstalt für Finanzdienstleistungsaufsicht grants operations of forex and CFD brokers in Germany by the leading authority, Federal Financial Supervisory Authority. BaFin license is granted to top-tier best forex brokers in Germany for all traders after they meet the trading conditions.
BaFin functions differently from the regulators of other jurisdictions. It is not funded or aided by the Federal Government, rather it is financed through the license fees or Germany forex fees derived from different financial institutions. Because of this, BaFin is an autonomous body and completely impartial.
BaFin ensures the current stability of the financial industry in Germany through regular supervision of the areas given below:-
- Banking Industry
- Bank Accounts
- Securities Industry
- Legal actions against financial crime
- Insurance Industry
BaFin regulates forex trading in Germany and it is legal since there is no such law governing it. Any Germany forex trader can work safely with the best brokers for all traders that comply with MiFID, a legislation covering forex trading across the Eurozone. Day traders must always look for MiFID compliant brokers or the ones licensed under the European Union.
One of the most important factors to consider immediately after regulation is safety. The level of security provided by the best forex brokers in Germany for all products must be checked and considered along with the transaction fees. Security features tend to vary from one broker to another. Some online brokers provide integrated safety and security features such as two-factor authentication that keep trading accounts safe from fraud and hackers. Moreover, the forex market in Germany is rigorously regulated by BaFin as well. The wide majority of the top best brokers are properly authorized and licensed to operate in Germany. Additionally, European and German regulations require online brokers to implement distinctive funds protection and security measures. Therefore the broker is secure.
Support EURO Currency
While choosing the best brokers in Germany, there are a wide variety of currency pairs in the forex market that you can trade depending on the broker one has an account with. Some online brokers provide around 40 to 50 pairs; on the other hand, there are top forex brokers in Germany that offer a substantially greater choice for beginners and experienced traders who can choose from more than 80 currency pairs. Regardless of the number of currency pairs the broker offers, it should be noted whether the broker supports Euros since, in Germany, most transactions are made in Euros, apart from USD. The review process must be thorough.
When it comes to trading fees, it is difficult to compare broker fees since there are so many brokers available in the market today charging different kinds of forex fees. Even the best brokers for all assets can charge low trading fees, spread, financing fees, commissions, inactivity fees, and withdrawal fees.
In the case of commissions, German forex brokers use two versions of:-
- Trading fees are counted as the spread excluding the financing fee. Hence, this can be thought of as the broker offering the traders a wider spread than available in the market.
- The second version involves the market spread along with a commission fee based on the traded amount. This particular fee model is typically used by ECN brokers.
The second type is relatively transparent; However, it does not imply that the first version can not be cheaper.
Next comes the financing fee. When a user wants to trade foreign exchange on leverage and wishes to hold his position overnight, a usual fee known as the financing fee is charged. These costs change regularly and can be an important cost to consider for traders if they wish to hold their positions for longer. Regardless of the many kinds of fees, traders should always choose a trading platform that offers low trading fees and has the best brokers in Germany.
Generic Trading Platforms
In Germany, the broker offers the MetaTrader4 trading platform which is a great choice for beginners and experienced traders. This is because, apart from allowing traders to add complex patterns and indicators and trade from charts, MT4 also allows them to program or implement their EA’s or expert advisors. This piece of code identifies certain patterns or strategies to create trade signals for traders.
In addition to this, many German brokers for all products provide the cTrader and Sirix trading platform that come second in terms of popularity, after MetaTrader 4. However, all these trading platforms have web trader, mobile trading platforms, and a desktop web platform. Finally, traders must ensure these generic platforms feature the Germany forex broker’s logo.
Proprietary Trading Platforms
Some of the best brokers design and create their proprietary trading platforms. However, this takes a lot of investment and effort from brokers since they develop the platforms according to their requirements. This option is usually better since brokers can modify the proprietary platforms that tend to be highly customizable by users.
Good Customer Support
Today, customer service is an essential facet of every broker since most brokers are not physically located nor physically accessible. This is the sole reason why the quality of the broker’s customer service team must be above-par. There is no doubt that German forex brokers have highly knowledgeable and efficient customer service teams which are multi-linguistic. Most traders will find these platforms are localized, meaning the platforms are translated into German.
Pros and Cons of Forex Trading
Pros of a Forex Trading
Forex trading tends to have low costs, commissions, and brokerage. There is no commission and the online broker makes profits from spreads between the forex currencies.
Offers Various Trading Styles
The forex markets operate throughout the day. This enables customers to trade at their convenience. This tends to be beneficial to short-term customers who want to take positions on short durations.
Unlike other financial markets, forex has one of the largest numbers of participants and markets. Therefore, forex trading has the highest level of liquidity. This means that even the large currency orders trades are efficiently and easily filled without large price deviations.
Volatility Is a Trader’s Friend
Fiat and cryptocurrencies frequently show high price fluctuations. If the trades are made wisely, high volatility may assist in huge profit-making opportunities.
Cons of a Forex Trading
Since the market is deregulated and mostly dominated by brokers for all products, a user mostly trades with professionals. The trading is driven by brokers and hence, the market for forex may not always be fully transparent.
Complex Process for Price Determination
Foreign exchange rates are greatly influenced by many external factors such as economics and global politics. These can be quite hard to analyze and draw reliable and strong conclusions to trade on.
High Leverage, High Risk of Losing
Trading forex is available on the highest leverages, which means an investor can get profit or loss exposure several times of the trading capital. Forex mobile trading markets offer leverages of 50:1 and hence, an investor needs to have $1 only to take a positive in forex worth $50.
To sum up this best German forex brokers review, it is recommended that German traders work with those brokers only that are licensed and regulated in the Eurozone. These forex brokers Germany belong with the MiFID directives and the German traders, therefore, get a higher level of protection from the German regulated broker.
Security includes security levels of the brokers, the client accounts are separated from the accounts of the brokers and the traders receive a compensation scheme. This implies that the deposits of the traders are protected up to 20000 EUR if the brokerage firm becomes insolvent.
Note that CFDs are quite complicated with a high risk of losing money as leverage is involved. Most of the retail investor accounts lose money when trading CFDs. Additionally, you should consider whether you can afford to take the high risk of losing your money. Nobody likes to lose money when trading CFDs.
Which Foreign Exchange Broker Is Legal in Germany?
All German forex trading platforms that are regulated by BaFin financial authority are legal. There are no such laws that govern forex trading.
Can I trade Forex in Germany?
Yes, German traders can trade forex and enjoy an average execution speed of orders of 36.5 ms.
Is Forex Trading Allowed in Germany?
Yes, Forex trading is legal and allowed in Germany.
Do Forex Traders Pay Tax in Germany?
BaFin regulated forex brokers Germany and are exempted from paying taxes. German investors in forex trading are subject to new capital gains taxes.