Forex Brokers in Cyprus

CySEC regulation

In Cyprus, Forex brokers must be regulated by the CySEC, the Cyprus Securities and Exchange Commission. Even if there are serious requirements to have a licence from the CySEC, the rules are more strict than in the early years, this juridiction is still seen as friendly and attractive for Forex brokerage firms. Due to the fact that Cyprus is a state of the European Economic Area, CySEC take part of the European MiFID regulation. It means that all Forex brokers registered in Cyprus and regulated by the CySEC can have access to the market of the European Economic Area and are allowed to offer their services to european customers. That is why a lot of Forex brokers choosed to be domiciled in Cyprus. It is now even more the case due to the fact there are a lots of supplying companies that can serve brokerage firms there, Cyprus is still one of the most attractive country for Forex brokers. From the point of view of a trader, Cyprus-based forex brokers can be well considered.
CySEC brokers must conform to the following rules:

• Funds of traders must be kept in segregated accounts.
• There is an insolvency protection under the Investor Compensation Fund, compensating clients up to €20,000.
• Financial statements of brokers must be reviewed on a periodic basis.

What is Forex?

Forex is a shortened term used for "FOReign EXchange" (commonly known as FX), it is typically used to describe the process of buying and selling currencies. Forex is a global market for the trading of currencies, it is the largest market in the world, opened 24 hours a day from Sunday evening until Friday night. Forex is also the most liquid financial market, there is a huge trading volume: each day, more than 5 trillion dollars are exchanged, there are always a lot of trades.

Forex trading

Currency values rise and fall against each other due to a number of economic, technical and geopolitical factors. The common goal of forex trading is to profit from these changes in the value of one currency against another. All forex pairs are quoted in terms of one currency versus another, Forex trading is the act of simultaneously buying one currency while selling another. Each currency pair has a "base" currency and a "counter" currency. The base currency is the currency on the left of the currency pair and the counter currency is on the right. For example, in EUR/USD, EUR is the "base" currency and USD the "counter" currency. A forex trader will buy a currency pair if he expects its exchange rate will rise in the future and sell a currency pair if he expects its exchange rate will fall in the future.

What is a broker?

Traders must conduct their trading activities through a forex broker. A broker acts as an intermediary between the buyer and the seller involved in a forex transaction. They provide trading platforms that allow traders to buy and sell foreign currencies. Traders have to take the time to research and compare options to find the broker that best fits their needs.