Situation of the FOREX market in Australia

Situation of the FOREX market in AustraliaFor years, most of the Forex brokers have installed and moved their operations to Cyprus, a country that offers them better conditions to develop their businesses, including lower taxes. Likewise, in Cyprus, they can obtain the license and regulation of CySEC (Cyprus Securities and Exchange Commission), the agency in charge of regulating financial services in that nation, which complies with the strict guidelines established in this matter by the MiFID (Directive on Financial Instruments Markets, by its initials in Spanish).

In this way, these brokers obtain both a base of operations suitable for their business and regulation that provides greater security and peace of mind to their customers.

However, many traders are not very confident about the name of Cyprus and CySEC because it is not a country with a long financial tradition like Switzerland, even though many companies, which now offer serious services, have moved their operations to this European nation.

For this reason, many traders look for companies that are installed in countries that offer a greater degree of security due to their laws, the tradition in the financial services sector and regulation among other factors.

A country that offers these conditions is, precisely, Australia.

Australia is among the eight most important financial centers in the world, along with the United Kingdom, the United States, Japan, Singapore, Switzerland, Hong Kong and France, and they operate within the Asian session.

Australia is a country that in recent years has experienced great growth in the financial services industry and has strict regulation in this area, which is exercised by the ASIC (Australian Securities and Investments Commission), the main regulatory body of financial services in that country.

The functions of ASIC are the following:

ASIC’s function is to regulate the financial services and the market of Australia. It is one of the main authorities when it comes to regulating OTC (Over The Counter) markets (including Forex), and its functions include the regulation as well as the control of all the companies that offer financial services, such as Forex brokers and option brokers binaries which are operating and registered from Australia.

ASIC seeks to ensure that all financial services companies that are registered and have a license to operate honestly, loyalty and efficiently.

The boom in financial services in that country has led to the creation of important Forex brokers (and other markets) in Australia. Likewise, many brokers have moved their operations or have installed subsidiary offices or brokers in that country to take advantage of the benefits offered.

The main advantages of trading with an Australian Forex broker are the following:

Australia is a developed country with a strong and important economy, and therefore has strong regulations on financial services. Likewise, this sector has had an important growth during the last years which has been developed under this regulation.

All Australian brokers are under ASIC regulation, which means that they must comply with strict regulations on financial services. This gives the client greater security concerning the handling of the funds and the practices of the broker.

Australian brokers offer the possibility of opening Mini accounts with deposits of only $200 and even less, which are ideal for beginner traders. This differentiates Australia from other countries, where relatively large minimum deposits are required for a particular trader to open an account and operate in the market.

Among the brokers that operate in Australia, we have XM, FXOpenAus, EasyMarkets, Pepperstone, AvaTrade, FX Primus, HyMarkets, ICMarkets, ThinkMarkets, Axitrader, to name a few.

No excessive restrictions are imposed concerning the operations of the clients, neither regarding the margin or leverage offered by the broker. Not the same as in the case of the United States, for example, where the maximum leverage is 1:50 and hedging is not allowed (open two positions in the opposite direction on the same instrument and at the same time).

The Australian Dollar was among the main drivers of the currency world, losing 0.6% against the United States Dollar and touching a minimum of 4 months. That movement comes immediately after the disappointing labor data of Australia which showed that the third-quarter wage price index went up 0.5% (quarter-on-quarter) and 2.0% (year-over-year), which did not arrive at analysts’ forecasts of a rise to 0.7% and 2.2%.

Meanwhile, the central bank of Australia had been predicting that wages would rise.

Currently there is a season of positive earnings and better ratings compared to a year ago, there is a good reason for buyers to take control and take advantage.

But, as always, trading in Forex has its risks and is not suitable for all investors. Regardless of whether it is on this continent or any other, before deciding if you want to start the operation, you must carefully consider your investment objectives, level of experience and risk.

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