Singapore, although it is officially known as the Republic of Singapore, is an island archipelago located between Malaysia and the South China Sea. It is a financial centre for trade in the Asia-Pacific region, on par with London and New York. Its primary island is densely packed, while its entire population is just under six million inhabitants. Its annual GDP, however, is roughly $340bn, thereby making it one of the highest GDP per Capita nation in the world. Singapore is also one of the Four Asian Tigers, along with Hong Kong, South Korea, and Taiwan.
Licensed forex trading brokers proliferate in this island community and are regulated tightly by the Monetary Authority of Singapore (MAS), which also acts as the country’s central bank and regulates all sectors of the financial industry, including banks, stocks, foreign exchange and insurance companies. When it comes to making your choice of Singapore-regulated forex broker easier, we have prepared the following ‘top 10’ list of brokers for your review.
Founded in 2010 in Melbourne, Australia, Pepperstone has grown to be a world leader in forex, processing over US$12.6bn of trading volume each day for over 300,000 satisfied traders across the globe. All funds are safely segregated in Tier-1 banking institutions per regulatory requirements from seven global regulators.
The firm is also a perennial award winner, taking the top honour of Best Forex Trading Platform in the Singapore market in 2021.
Plus500 was established in 2008 and has become a leading broker for CFDs in both Europe and Asia. The firm continues to invest in innovation and research and development, having recently opened a new R&D Centre in Tel Aviv.
The company has also chosen to sponsor several sports teams, ranging from the Brumbies of Australian rugby fame to Atlético de Madrid in Spain.
Founded in Tel Aviv, Israel, eToro has morphed over the years into an online brokerage powerhouse. Its user-friendly platform is the best of its kind to facilitate ‘copy trading’, the ability of one trader to implement the trades of a selected expert onto his personal account. It is now global, serving 20 million customers across the planet and offering thousands of financial instruments for trading.
Headquartered in Cyprus, eToro continues to innovate and grow while complying with a host of regulatory agencies. Funds are always safe, segregated in separate accounts at Tier-1 banks. If you like copy-trading and the ability to use customised portfolios for thematic purposes, then eToro may be your broker of choice.
IG was established in 1974 and now has over 239,000 worldwide clients. It is the number one provider of CFDs in the world and has access to over 17,000 markets for assets under its roof. IG is regulated by the MAS, as well as by a host of other international regulators of the first tier.
The firm has always been an innovator and at the forefront of the forex industry from 20 offices located in 17 countries. If you want the biggest and the best, IG is in that category.
AvaTrade was founded in 2006 and is headquartered in Dublin, Ireland. Per its website, the broker has been “pioneering online trading” for fifteen years (source: AvaTrade). It offers a wide range of popular assets industry-leading platforms and “generous trading conditions” (source: AvaTrade).
Its primary regulator is the Bank of Ireland, but it complies with the edicts of six other regulatory bodies across six continents, making it one of the most respected brokers for operating in a secure and safe manner.
AvaTrade has over 200,000 registered clients across the globe, over £60bn in monthly trading volume, and over two million trades executed every month. It also has offices in Dublin, Paris, Milan, Tokyo, and Sydney.
Saxo Bank is a fully licensed in Denmark under the auspices of the Danish FSA regulatory body. In 1998, the trading division, Saxo Markets, launched one of the first online trading platforms, breaking down barriers in the process. The firm is highly trusted, regulated in 17 jurisdictions, including Denmark, the UK, and Singapore.
Saxo has over 660,000 customers, who place over 180,000 trades per day at industry-leading price points.
The XM Group was initially founded in Cyprus in 2009 but soon expanded its operations to include support offices in Australia and Greece. The firm serves clients in over 196 countries and excels in the area of education materials for beginners. If you are a beginner and like MetaTrader 4, then XM may be well suited for you.
HYCM has a heritage of over 40-years, delivering excellent financial service and has positioned itself as one of the most trusted and transparent brokers in the forex industry. The firm offers tight spreads from 0.2 pips on over 300 instruments at execution speeds under 12 milliseconds. The management team has chosen the MetaTrader family of platform products for trading from desktop to mobile device.
HYCM has earned over 20 global awards for excellence, the most recent being the Best Forex Broker in Asia for 2021.
The company serves customers in over 140 countries from offices in five of the leading financial centres of the world.
Founded in the mid-1990s, OANDA was one of the early pioneers of online forex trading. It has grown to such a level that it is estimated that 20% of all forex spot trades pass through one of its server platforms. Known for its innovative trading practices and trading platforms, OANDA has always focused on customer satisfaction and performance excellence.
Among six regulators that have oversight over OANDA’s activities, MAS is one of them. The firm has also won the ‘Best Forex Broker Award in Singapore’ on numerous occasions.
Founded in 2009, EightCap operates out of Melbourne, Australia, but also has five other offices spread out around the globe. It has received a number of awards. Most recently, the Global Forex Awards recognised the firm as the ‘Best Global Forex MT4 Broker 2020’.
All client account deposits are held in segregated Tier-1 financial institutions per ASIC regulations.
Execution speeds are fast, and scalping, EAs, and hedging strategies are allowed on all account categories. The firm can offer tight spreads due to its network with premium liquidity providers. There is also no dealing desk since all trades are matched directly with liquidity sources.
For anyone visiting Singapore for the first time, it can be a culture shock with respect to the strict enforcement of all manner of rules, from where you might cross a street to what hurdles a forex broker must clear in order to have a presence on the island. These rules have a lengthy overbearing history with its citizenry, but the rules in the financial sector are designed to protect consumers from scams, unfair business practices, and bankruptcies. All accounts must be segregated from the operating funds of the brokerage, for example.
There is a combination of MAS-licensed brokers available to traders. There are several local forex brokers, as well as international brokers located offshore. As a Singapore citizen or foreigner living on the island, the MAS does not require that you deal only with this select group of licensed brokers. The rules permit you to use an offshore broker, but only if it is sufficiently regulated in its own country of origin. The MAS, however, stresses that it cannot be of assistance if and when a trader encounters foul play while trading with one of these offshore forex brokers.
There are tax benefits for individual retail forex traders. You are not taxable on your recorded gains, nor will a brokerage report these figures to the government taxing authorities. If you are a professional trader by occupation, then your transactions are taxable. If you are a professional, you may defer your tax consequences by dealing with an international broker who is offshore. Your profits are taxable, however, when the funds are transferred to a bank account in Singapore.
As an attractive financial centre, Singapore’s standard of living and AAA credit rating add to the allure of this location as a centre for operations to serve all of Asia. Singapore is also a high-tech powerhouse with supporting infrastructure – a reason why large financial institutions and liquidity providers flock to this locale. These factors also make it an ideal environment for forex brokers to operate their servers and provide their products and services to consumers throughout the region.
As a respected financial hub, it is no wonder that trading foreign exchange in Singapore has become very popular, based upon a supportive legal infrastructure and strict regulatory oversight from the MAS. The Singapore Dollar or ‘SGD’ is also considered to be one of the most stable and strongest of the world’s currencies, ranking in between the euro and the US dollar.
Any one of the above brokers could become an effective business partner for you, but always remember that trading foreign exchange is a risky endeavour. Preparation, practice, and a defined strategy will always help to mitigate those trading risks, but monitoring a broker’s performance is necessary, too.
Forex trading is flourishing in the island community of Singapore and for good reason. Its reputation as a stellar financial centre has drawn banks, liquidity providers, and forex brokers in droves due to its high standard of living, its high-tech infrastructure and its supportive regulatory environment.
For individual retail forex traders, trading profits are not taxable income, and there are a multitude of high quality brokerage houses to ensure a safe and secure trading experience.