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Forex Trading in Germany


Traders from Germany account for a large portion of Forex traders. There are many popular German Forex brokers that contribute to a strong and healthy German economy. Top German Forex brokers are not required to hold a license with the local BaFin (Bundesanstalt für FinanzdienstleistungsaufsichtFederal Financial Supervisory Authority) but commonly hold a license with one of the major regulators.


Regulation for German Forex brokers


Germany does not regulate the Forex market; instead, it licenses and regulates the German Forex and CFD brokers so that they may actively accept German traders. Many German Forex brokers that offer online trading access hold offices in major financial hubs within the Eurozone such as London and Frankfurt.

The best German Forex brokers are typically registered with BaFin (Bundesanstalt für FinanzdienstleistungsaufsichtFederal Financial Supervisory Authority) and are MiFID (Markets in Financial Instruments Directive) compliant. Many of these top German brokers hold further licenses with one of the larger European regulators such as the FCA (Financial Conduct authority) of the UK or CySEC (Cyprus Securities and Exchange Commission). These regulated Forex brokers can be considered the safest.

There are, of course, other jurisdictions and regulatory bodies, such as the Australian Securities and Investments Commission (ASIC) in Australia for example, but there are also many other ‘weaker’ jurisdictions from which brokers operate. This doesn’t necessarily mean that they are all ‘bad’ brokers, but it is true that it is often much easier for brokers to get registered in these jurisdictions as they tend to have lower capital requirements, looser policies and procedures, and limited oversight and enforcement powers. It is, therefore, advisable to choose a German Forex broker that is licensed and regulated by the FCA or any other of the EU watchdogs and strong regulators.

Forex Trading in Germany and EU


All German and overall Forex brokers operating within the Eurozone have recently been limited by the ESMA (European Securities and Markets Authority) to offering maximum leverage of 30:1 to all their retail customers. Further limitations on cryptocurrency trading and even bans on certain trading products, such as ‘binary options trading’, have also been enforced by the ESMA. Though other jurisdictions allow higher, or sometimes even unlimited, maximum leverage settings and have not yet banned any trading products, it can be beneficial for retail clients to keep their trading under better control with these ESMA-enforced rules.

Traders should always be very cautious when using high leverage settings as they impose a high risk. A 30:1 leverage on major currency pairs already increases one’s risk exposure quite drastically.

Trading conditions of top Forex brokers in Germany


Our review highlights a list of the top German Forex brokers based on regulation, security, reliability, professionalism, customer service and, of course, trading conditions, to help you find the best Forex broker located in Germany for your specific needs. We highlight predominantly regulated brokers because we trust that the best brokers would always seek proper licensing and regulation.

When it comes to trading the Euro (EUR), one of the major currencies that it is traded heavily against on a daily basis is the US Dollar (USD) in the EURUSD currency pair. It makes sense to look for a local German Forex broker because they often offer the best market spreads for EUR pairs as well as fast execution.

However, it isn't just the local currency can be traded very well with the best German Forex brokers. Many of the leading Forex brokers offer an overall outstanding trading environment, very competitive spreads, fast execution speeds, a large range of trading products and many other great features, such as the option to engage in copy or social trading for example.

Example of a top Forex broker for German traders


Almost all top German Forex brokers offer leading trading platforms such as MetaTrader4 (MT4) and its younger brother MT5 or cTrader. Some brokers also offer their own proprietary trading platforms that are often very intuitive, easy-to-use and feature rich. These top brokers offering Forex and CFD trading typically allow traders to test their trading platforms and the environment by offering a demo account option among their trading accounts.

Top German Forex brokers, such as XTB, offer access to a wide range of financial markets and the option to trade CFDs, Forex, shares, commodities, cryptocurrencies, ETFs and indices.

 

Conclusion


German traders can choose from numerous Forex brokers. German traders can also trade anywhere they like as Germany doesn’t impose any legal provisions to Forex trading. German traders who are looking for Forex, shares or CFD trading opportunities may also be accepted to trade across the Eurozone with brokers that are MiFID (Markets in Financial Instruments Directive) compliant.

Check out our comparison table and ranking of Germany’s top Forex brokers above to help find the best Forex brokers that are best suited to your needs. If you need more in-depth information or are looking for more brokers to choose from, check out our detailed individual broker reviews and other comparison tables.