Best Forex Broker South Africa 2023

In this guide on the top forex brokers in South Africa, we go over the top-rated brokers on a variety of factors. We base our guides on hours of research and outline our top picks. Minimum deposit, low fees, account opening, regulation, trading platform, and more are taken into consideration.

Best Forex Trading Platforms South Africa 2023

Here is our list of the South Africa Forex Brokers for 2022. We’ve detailed their benefits and given you our opinion on where they might lack. You should read the guide on trading platforms in South Africa.

• Plus500 – Our Top Pick for Forex CFD Trading In South Africa
• Pepperstone – Best Low Spread Forex Broker South Africa
• AvaTrade – Best Forex Broker App South Africa
• XM – Best South African Forex Broker for Education
• FXTM – Best Customer Service Forex Broker South Africa
• FXCM – Best Algorithmic Forex Broker South Africa

>> Want to Trade Forex? Check out our guides on:

• Forex Brokers offering Low Spreads
• Day Trading Mobile Apps for 2022

What to Look for?

When picking the best south African forex broker, we advise you to remember the following.

Regulation 

The company you pick should be registered with at least one financial regulating authority. The Financial Sector Conduct Authority (FSCA) is the regulating body in South Africa. Your brokerage firm needs to follow all the rules and regulations set out by the FSCA.

Account Security 

The best will make your account security a top priority. Account security features help ensure that your account is protected from growing cyber threats. Features such as two-step authorization should be included. This ensures your personal information is kept safe.

Currency Pairs Offered 

You need to make sure to find a broker that offers the exact currency pairs that you are interested in. The best offer traders a wide selection of currency pairs.

Fees & Commission 

Some charge a wide range of trading and non-trading fees. If you’re a retail trader then it’s best to choose a broker with low commission fees. It’s important to be aware of all the fees in advance. 

Rollover Interest 

Rollover interest is charged by a broker when a position is held at the end of a trading day. Different brokers might charge different rollover interest rates. Low rollover interest rates are best for beginner forex traders.

Platforms Supported 

A user-friendly platform goes a long way to improving your experience. You should choose one that gives you access to premium platforms such as MT4, cTrader, MT5, or proprietary. Some offer their proprietary solutions, which offer unique tools and features.

Leverage and Margin 

Leverage is when you use borrowed capital to open a trade position or make an investment. This has the potential to increase your returns, but it increases your potential risk at the same time. High leverage trades usually lead to higher risks. This will depend on how successful the trade is.

Margin risk is the financial risk that comes with achieving an expected margin. This refers to the probability that a specific economic change will negatively affect your expected outcome.

Account Types

There are different account types available to different types of users. You should know what you are looking for and need. Different account types usually come with different trade fees and account minimums.

Mini or Micro Accounts: A mini account, also known as a micro account, is an account aimed at smaller investors to access the market. This account type best suits beginner traders who plan on trading small volumes.

Retail Accounts: A retail trader trades their own money but does not trade for a living. Some cater more to retail traders with lower fees and no minimum account balance.

VIP or Professional Accounts: A VIP or professional account is designed for traders who make large deposit amounts and actively trade large volumes. These accounts offer custom-tailored services for professional traders. Account-holders are generally charged lower fees along with more competitive account fees. 

Demo Account

Most platforms have Demo accounts available. These are also known as paper trading accounts. This allows you to invest virtual money in a real-time market simulator. This is particularly useful if you’re a beginner.

Deposit Methods

They should offer a smooth and straightforward deposit method. A simple process and deposits should be available. Make sure they offer the deposit method you want to use. These include credit cards, bank transfers, e-wallets, crypto transfers, and others.

Base currency and the ZAR

You’ll want to look for a broker that offers currency pairs with the South African rand (ZAR) as the quoted currency. 

Always make sure you choose one that offers a selection of base currencies you are interested in. The best will have a wide range of currency pairs available.

Order Types 

These are the most common order types that you should know.

Market orders are the most common order types. These orders will instantly execute a trade at the current market price.

Limit orders are another essential type of order to understand. A buy limit order is placed to buy at a specific price or lower. You place a sell limit order to sell at a specific price or higher.

Pending orders are orders that are still waiting to be executed at a specific price in the future. 

Stop orders prevent your order from being executed until the price of your security reaches a specific point. 

Stop loss orders are a type of order designed to prevent additional losses. If the price movement of the security goes against you, then the order won’t be executed.
Trailing stop orders are a type of stop loss order that changes depending on the price fluctuation of the market.

Mobile Trading 

A mobile trading platform is a more condensed version of a standard desktop platform. This allows you to manage your portfolio through an app on your smartphone. This is useful if you are looking to trade on the go. Make sure you choose a versatile and well-designed app.

Type of Brokers 

Market Makers create the market prices for their clients. This means that they will often take the other side of a trade in order to control fixed prices.

Both Straight Through Processing (STP) and Electronic Communication Network (ECN) brokers do not create market prices. These let their users trade at current market prices. They only act to connect trading parties.

Education and Research Available 

Education resources are vital for new traders. Some examples of useful resources are tutorial videos, how-to articles, and community forums. 

They should provide a variety of market research. Access to in-depth currency price movements will showcase its performance and potential growth on the market. This allows you to perform a thorough market analysis.

Tools Available 

You should choose a company that offers a range of trading tools. This includes charting tools, price alerts, and analyst ratings. 

Trading comes with high financial risk. This is why it’s important to choose a platform with risk management tools. These significantly help with your strategies.

Customer Service 

They should provide access to hands-on 24/7 customer support staff. It’s essential to have easy access to support. This is especially important for beginner traders. Make sure you can quickly get in touch with staff for any urgent advice or technical issues.

Execution Speeds 

Order execution is the time that it takes to complete a buy or sell order. Each order is sent through to your broker to be executed on your behalf. Fast order execution time is essential if you’re interested in day trading.

Hedging and Scalping

Scalping is a short-term strategy that involves trading quickly closing a trade with tight pips. 

Hedging is another common strategy used by active traders. It involves placing orders on both sides of a currency pair. *

*Check with your provider to see if they allow scalping/hedging

Risks of trading Forex

While Forex trading comes with high potential gains, it also comes with high risk. Before jumping in you need to understand the most common risks involved.

Margin and leverage risk is when a sudden price movement in a trade might result in immediate losses above the amount you invested.

Exchange rate risk is the potential loss caused by changes in the value of a currency. This is due to the constant shifting of worldwide supply and demand.

Interest rate risk refers to the profit and loss made by changes in global interest rates. One of the most significant factors in the Forex market is interest rate changes made by the eight global central banks.

Forex Fees Explained

Spread

The most apparent fee is the spread. This is the difference between the buy and sell price in a currency pair. The lower or tighter the spread, the less you will spend on the trade. Trustworthy companies make their spreads public for all currency pairs.

Rollover fees

The rollover fee is a small fee charged for holding a position overnight. These are only avoided by opening and closing trades on the same day. If you’re looking for a cheaper broker, then you should make sure that their rollover interest rates are low.

Deposit and withdrawal fees

The best charge no fees for deposits and withdrawals. This is an easy way for some to make money off clients. Some might charge a flat fee, while others charge an amount percentage. This makes large deposits and withdrawals very expensive.

Minimum deposit

Most require a minimum deposit amount to open an account. This amount varies. Some will only require a minimum of R50, while others might R5000 or larger deposits.

FAQ