United Arab Emirates (UAE), a country consisting of seven emirates of Abu Dhabi, Fujairah, Ajman, Dubai, Ras Al Khaimah, Sharjah, and Umm Al Quwain, is one of the most interesting Forex markets right now. Not because it’s the biggest or the most prosperous one, but because it definitely has its own character.
Forex trading is really popular in the country, and it’s getting more and more popular by the day. Not only among the traders and the people who are interested in getting started, but among the brokers themselves too. In fact, thanks to some very favorable conditions like flexibility and relaxed laws and regulations, UAE is one of the most popular destinations for Forex brokers. This, obviously, while it may be very welcome by some people, many people feel a bit of a concern due to this relatively weak regulatory environment. Is there a cause for concern, and an increased risk of being susceptible to scams and other types of negative consequences?
If you are interested in getting started with Forex trading in UAE, and these are the very questions that you have right now and want some measurement and clarity on these points, then this guide is for you! Here, we will discuss what the current Forex market of UAE looks like, what are the relevant regulations and entities protecting you, and what kind of trading options are waiting for you. By the end of it, you should have a solid understanding of how everything works, and be in a much better position to start off your trading journey.
Our personal UAE forex brokers list
After reviewing dozens of international and local brokers that are also available in UAE, we have identified several of them that we believe are ideal for the local traders. These brokers are great because not only are they offering a high quality of service by international standards, but they are very compatible with the local trading populace due to their specific options that are sought-after by many traders form this region. We encourage you to take a look at all of these brokers and find the one that works the best for you. You can rest assured that we only picked the best-of-the-best, so no matter which one you choose, you’ll be good to go!
FCA, CySEC, IFSC, ASIC, DFSA
MT4, MT5, WebTrader
Desktop, WebTrader, Mobile
FCA, ASIC, CySEC, FSCA, FMA, MAS
WebTrader, Windows 10 Trader
Regulatory environment – are there any regulated Forex brokers in the UAE?
This is the part where it’s really interesting. You see, UAE is one of the top Forex markets in the world, at least in terms of the number of people involved in trading, as well as the number of brokers. In Dubai, there are so many brokers operating, that you can find pretty much any kind of a broker that would fit any kind of taste. The main reason for this is very relaxed and flexible regulatory conditions. These conditions were created by the official regulatory body in the UAE.
Central bank of UAE
The regulatory body for Forex trading in the country is the Central bank Of UAE (CBUAE), and it serves as the general regulator for every emirate of UAE. It was founded back in 1973, mainly because of the fact that the country started gaining a big momentum economically after discovering their oil. Over the years, CB of UAE has grown very much in power and has become one of the exemplary banks in the world. Today, besides the monetary policies and managing the currency of the country, it also serves as the regulatory body for the Forex and other similar markets.
Here’s the interesting part – CBUAE was initially very conservative and strict with their policies, as well as what the brokers were allowed to do. However, with the increased globalization of the country, and as it realized its economic potentials, these all changed, and they started coming up with rules that were very attractive for international brokers. The result is what we see today – countless brokers flocking to the UAE market.
Over the years, not only did the market gain strength from the international companies but from the companies and investors from the region as well. Nowadays, UAE is the main Forex and financial hub of the region and is likely to remain so without competition.
As the number of brokers increased heavily, the need for more effective and focused regulatory practices was being more and more apparent. With the regulations and restrictions being so relaxed, there were a lot of cases where traders got scammed and lost their money. As a result, CBUAE reviewed these laws again, and since then, it has found a perfect balance of regulatory practices, where the danger of brokers operating in an unethical and fraudulent manner has dwindled down significantly, while simultaneously allowing the restrictions and requirements to be flexible enough for the market to still remain ver effective for the brokers.
In general, the separate emirates do have their own specific regulations and policies in some aspects, but overall, at the end of the day, it’s CBUAE that has the “final say” in the most important matters and serves as the main regulator for all emirates involved. To this day, it is thanks to the effective implementations made by CBUAE that UAE has managed to become such a highly-regarded, top destination for Forex brokers.
What are some of the requirements imposed on the UAE Central Bank regulated Forex brokers?
CBUAE has multiple different sets of requirements and laws that they have implemented in order to control and regulate the brokers in the country. These requirements, taken together, have been absolutely amazing in shaping the UAE Forex market into what it is today. Let’s discuss them one by one.
One of the first things that CBUAE did was introduce the need for a license. The license could only be obtained by only the brokers who would satisfy the necessary requirements that would be set by the CBUAE. These requirements would all be aimed at ensuring that the broker is conducting their business in a legally, fairly, and in a way that is conducive to the traders’ and the whole market’s well-being.
Minimum required capital
One of the main requirements for obtaining the license is for the broker to have a minimum operating capital. This would be determined based on the overall activities, as well as the transactions performed by the broker. As was determined, this amount can vary anywhere between 1 million AED all the way to 30 million AED, depending on the broker.
One of the other main tools that CBUAE uses to control the activities of the brokers is by requiring regular, detailed audits. These audits are required to be submitted by brokers periodically, so the CBUAE can make up to date and fresh reviews and assessments. These audits are common across many different Forex regulators all over the world and are very effective and important tools. They allow the regulators to make sure, that the business is conducted in an ethical and transparent manner, which would’ve been harder without them.
If an audit or an analysis indicates that the broker is not following the requirements as needed, the regulators can then take appropriate action, and resolve the issue. Needless to say, this is one of the central tools for CBUAE.
Owned by UAE nationals
Another one among the main requirements is that the brokerage needs to be under the sponsorship and ownership of a UAE national, who will be the owner of at least a 51% stake in the company. This ensures that the brokerage is operated with the national interests in mind, and prioritizing the well-being of the UAE citizens.
Should you go with CBUAE-licensed brokers only?
As we have discussed, CBUAE is a very effective regulatory body, and thanks to it, the market conditions are excellent for the traders, providing them with safety and high-quality brokers. However, it is well-known, that many UAE natives are trading with non-CBUAE-licensed brokers as well. One common question that we get is if you should be trading with brokers in UAE that are not licensed locally.
The answer is that it depends. Usually, if you have a choice between two legitimate brokers, where one of them is CBUAE-licensed and the other is not, it always makes sense to go with the broker that does have a CBUAE license. The reasons should be obvious – you have more layers of security, firstly because you know that the very government of yours has deemed the broker trustworthy enough to be operating. Secondly, if it ever comes to a point where you have some kind of a dispute with the broker and you need to seek outside help from the authorities, then your case will be handled based on the local laws and regulations, with which you are much more likely to be familiar.
On the other hand, we would also like to stress the point, that you shouldn’t completely disregard all brokers who are not licensed by the CBUAE. If you are considering an international broker who has demonstrated their trustworthiness for many years and has very positive feedback from thousands of traders online, then just because they don’t have a license from CBUAE, it doesn’t mean that they’re not trustworthy.
At the end of the day, you are the only one who knows what’s best for your specific needs and requirements, so the best advice would be to give it a thoughtful analysis yourself, and conclude which option is the best for you. With our amazing list of brokers, you have a lot of different options to go through, and we are absolutely sure that you will find at least one broker from our list that will perfectly fit your needs!
What trading avenues do the UAE based Forex brokers offer?
UAE Forex market has an excellent diversity and choice for the commodities to trade on. However, perhaps the “best” commodity to trade on in the country is oil. Indeed, as a UAE native, you wouldn’t be too surprised to hear this. Oil has been the central piece in the country’s economy for many years now and is single-handedly the main reason for it to be so prosperous.
Naturally, the residents of the country who are trading Forex are much more likely to be trading on oil and much more likely to be successful at it. The volume for precious mineral fuels – basically oil – exceeds $90 billion in volume, which is absolutely massive. If you are a UAE native looking to get started with trading, you should definitely not miss your opportunity to use your home country’s amazing trading potential for oil.
On the other hand, if you want to stand out from the crowd and do something else, you definitely won’t be met with a lack of options. UAE is one of the major exporters of gems and precious metals, with the volume resting at over $45 billion. If you are interested in commodities that are more “secure” as compared to oil, which can be so volatile, then you can feel free to make use of this market. Whether it is gold that you want to trade on, or anything else, the options are abundant.
Besides the ones mentioned, there are tons of opportunities to trade on machinery and computers, vehicles, plastic, and more. As mentioned, variety is not even the slightest issue with the UAE market. The only thing you need is to take a look at all the options and choose what exactly it is that you’re looking for. Depending on your needs and requirements, like if you are looking for something safe and more stable, or conversely, something volatile but with bigger possible profit, there are lots of choices you can make.
Pros and cons of UAE Forex trading brokers
As is the case with anything else, the UAE Forex market has its own specific pros and cons. Make sure to take these details into account when making your decision on whether or not you want to get started with trading here:
- One of the best Forex ecosystems in the world
- Thriving oil market
- Lots of great local and international brokers
- Great regulatory authorities
- Relatively weaker national currency
- License not complusory
So, are you ready to start trading with UAE based Forex brokers?
The UAE has an excellent Forex market. Thanks to their amazing regulatory environment, combined with their strong economic role in the world thanks to their huge oil reserves, they have really shaped up to be a very strong market. All of this, combined with some amazing brokers that are operating there and joining the market every year, the UAE citizens have some really great opportunities to trade safely, securely, and most importantly, profitably.