Considering the size of Sweden’s population, for many people, it comes as a surprise that Forex trading is very popular in Sweden, with many opportunities and diversity. However, when you take into account Sweden’s economy itself, it should start making more sense. Currently, around 2.3% of all Forex trading activity comes from the Swedish Krona, so you can get an idea of how big Forex is in the country.
Throughout the last years, Swedish people have been enjoying an excellent Forex market, with many opportunities for all sorts of trading. Swedish Forex trading is distinguished by high quality, manifesting itself in aspects like safety, security high standard of service. Considering all of this, it is easy to understand why Swedes would love Forex trading so much.
In this guide, we will be taking a brief overview of how Forex trading in Sweden works, what opportunities are available for the Swedes, what kind of legal entities are regulating the market, and generally what to expect as a Forex trader in Sweden. Additionally, below we’ll be providing you with our shortlist of selected Forex brokers in Sweden. If you are looking for great brokers to start your trading journey with, you can be sure that you can count on our list, which was composed after doing hours upon hours of research, taking into account only some of the most important details that every trader is looking for.
Our list of best Forex brokers in Sweden
We all know how much hassle choosing your broker can be, considering you have to take into account a whole lot of things, such as your safety, how much benefit you’re getting from each broker, how it will work for you well into the future, and much more. There are many brokers satisfying all of these qualities, but there are equally as much that fail miserably.
This is why we are happy to present you with this list, which will help you by saving you time that you would have to spend on tedious research, as we are the ones who have already happily done so! Check out all the available brokers down below, and enjoy some of the best trading experiences in Sweden!
FCA, CySEC, IFSC, ASIC, DFSA
MT4, MT5, WebTrader
ASIC, FSA, FSCA, FFAJ, FSRA, FSC
FCA, ASIC, CySEC, FSCA, FMA, MAS
WebTrader, Windows 10 Trader
CySEC, FCA, SFSA
NFA, CFTC, FCA, FSA, IIROC and CIMA
WebTrader, MT4, MT5
MT4, WebTrader, Copykat
Forex regulation in Sweden
As a trader who is looking out for their safety and security, the regulatory environment should be one of your primary focuses. Why? Because the only thing that can legitimately guarantee your safety is the strong regulatory authority that has your back by watching the brokers and ensuring that they are following all the safety guidelines.
If this is something that you accrue a lot of importance to, then you will be happy to hear that Sweden has one of the best regulatory environments in the world. Trading safely is definitely something that you can expect in Sweden, and go on to make your profits with full peace of mind. The regulatory authorities in Sweden have always aimed to not only create the best trading conditions for Swedish traders specifically but to also take the market to the direction which harmonizes with the EU standards and regulations that are accepted all across the European Union.
This can be seen in Sweden’s effort to accept most of the recommendations and financial practices introduced by the MiFID (Markets in Financial Instruments Directive) of the EU. This allowed Sweden to present itself as one of the Forex trading countries with the best regulatory environments. This also allows Sweden to safely accept brokerages that offer services across many other European countries. Who are the regulatory authorities in Sweden, how do they work, and in exactly what ways do they guarantee your safety?
Finansinspektionen is the official financial watchdog of the country. It was officially formed in 1961, resulting from a merge of two previous government regulatory bodies, the Insurance Supervision Authority, and the Swedish Bank Inspectorate. The main function of Finansinspektionen is to oversee the activities of all companies that offer financial services to the country, and this, of course, includes Forex brokers as well. The goal of this combination was to create one unified, centralized regulatory body that would have more power and effective means to better-regulate the market. Needless to say, it was successful.
Finansinspektionen has done an absolutely excellent job of improving the Swedish Forex market conditions as much as possible. Thanks to their effective operation, Sweden is now regarded as not only one of the best markets to trade on for profit, but also one of the safest ones as well. Let’s have a quick look at some of the things that Finansinspektionen has introduced to take the country’s market in a positive direction.
Brokers who are seeking to be officially licensed from the government of Sweden specifically can seek to obtain the license from Finansinspektionen. The obtainment of license has certain requirements, and only the brokers that manage to satisfy these requirements get to obtain a license.
The license itself is not absolutely mandatory for a broker to offer their services to the Swedish traders. Since Sweden is a part of the European Economic Zone, and is subject to the standards of the MiFID, any broker that is licensed form any other regulators of the member countries such as CySec or BaFin, is legally qualified to offer their services in Sweden as well.
Nevertheless, many companies that are focusing on the Swedish market are voluntarily and actively applying for the license themselves. Why? Because being licensed by a country’s government is an ultimate form of validation for a broker, and seeing as there is so much opportunity to offer services profitably in Sweden, many brokers are happy to obtain the license of their own volition, despite no legal requirement.
However, the question is, is it safe for you to go with a broker in Sweden that is not licensed by Finansinspektionen? Well, the answer is it depends. In general, you should always make sure that you are dealing with a locally-licensed broker, as in case of having some kind of a dispute with them and needing to involve authorities, then this tedious process will be taking place in accordance with the local laws and regulations, with which you are much more likely to be familiar, and be much more comfortable throughout the process.
On the other hand, although your candidate broker may not be licensed by Finansinspektionen specifically, it may have a license from some other regulator, such as FCA or CySec. These two regulators satisfy the same standards as the Finansinspektionen does, and are also affiliated with MiFID. Technically, if you can trust a broker licensed by Finansinspektionen, you can trust a broker licensed by FCA too. The point is, if you are really interested in dealing with a specific broker, you should not discount them just based on the fact that they are not locally licensed if they satisfy all other safety requirements.
However, even considering that, you still always need to do the appropriate research and conclude for yourself whether or not the broker is trustworthy, and the right choice for you personally. Now, let’s talk about some of the specific practices by Finansinspektionen.
Caps on leverage
Although for many people having access to high leverage is important, it can be a very detrimental feature at times. In general, this is a subject that has a lot of different opinions around it. For some people, the ability to earn lots more money by having access to high leverage can be amazing, and the more leverage the broker offers, the higher the chances of them using their service. Indeed, in the right hands of an experienced trader who knows what they’re doing, high leverage can be a godsend.
On the other hand, for many people them especially beginner/inexperienced traders, high leverage can serve as their demise. With abnormally high leverage of one-to-thousands, there have been a lot of cases where these inexperienced traders have lost lots and lots of money. To counteract this, the EU countries, in accordance with the recommendation by ESMA, have made efforts to restrict brokers from offering high leverage for the traders.
Sweden, as a country looking out for the safety of its traders, was one of the countries that accepted this recommendation, and now, like most other countries following ESMA’s recommendations, maximum leverage is 50:1. No matter what your stance may be on this issue, what you need to know is that Sweden’s primary goal here is to look out for your safety. Indeed, this has proven to be one of the most effective tools for increasing safety, not only for Sweden but for any other country that has implemented this strategy.
Negative balance protection
One of the biggest problems that many traders faced, among them especially the ones that would utilize high leverage from the brokers, was losing more money than they have initially invested. This can definitely be one of the worst things that could happen to you as a trader, because not only would you lose your deposit, but you would owe more money to the broker on top.
This was one of the main reasons as to why restrictions on leverage were introduced in the first place. However, on top of that, the regulators over the world have introduced the negative balance protection rule as well, which works amazingly well for the protection of traders. In a nutshell, the negative balance protection practice ensures, that the traders can not lose any more than their deposited amount. Especially for beginners, this is a great feature, as it can definitely be easy to make some kind of a mistake that may result in a lot of financial damage. Having this kind of safety net can be a gamechanger for these people.
Restrictions and rules CFDs
Similar to leverage, CFDs have been delivering mixed results in terms of safety for many people. On the one hand, for some people, they have been a source of a lot of profit, but on the other hand, many people;e have lost a lot of money due to their risky nature. To counteract this, Sweden, among many other European countries,s have banned the sale of very high-risk CFDs, as well as restricted the brokers from advertising them to the traders.
CFDs are still available for the traders but in limited form. Additionally, the brokers themselves have to also make sure, that they supply as much information to the traders as possible regarding these CFDs, especially in regards to the risks and dangers that come with trading them. This can be seen in the requirement of the brokers having to publish regular disclaimers warning about the dangers of these assets, as well as detailed reports showing what percentage of the customers are losing the money with leveraged services and CFDs.
This kind of approach to increasing the awareness has been doing wonders not only for the Swedish market but for every other country where the regulators implemented it. Prevention is definitely one of the most successful approaches to making sure that the traders remain safe, and we can see the results with our own eyes!
Sweden’s regulatory environment in summary
As you can see, all of the requirements and implementations that Finansinspektionen introduced were made in mind with increasing the traders’ safety. Any Swedish citizen that is interested in getting started with Forex should be delighted with the fact that not only does Sweden have some of the best trading conditions and opportunities in the world, but at the same time, safety is prioritized, and your needs and financial well-being is heavily monitored by the government. If safety is one of the primary deciding factors for you, then trading in Sweden is definitely your cup of tea!
Currency trading in Sweden, and Sweden’s national currency
Currency trading has always been one of the most popular avenues in Forex trading for any country. Sweden is no exception for this, and many of the Swedish traders opt for currency trading over the other commodities. The national currency of Sweden is the Swedish Krona. Let’s have a quick overview of the currency, its history, and its current state, as it related to currency trading in Sweden right now.
The Krona has been the national currency of the country ever since 1873. The code of the currency is SEK, under which it is listed on the Forex exchanges. Although Sweden is a part of the EU for a long time now, it still has not adopted the Euro and has chosen for the Krona to remain its national currency. The Krona itself definitely has a long history, as the central bank of Sweden, is world’s oldest central bank.
Sweden’s economy, and what are the main influences on the Swedish Krona?
As a country with a complex and large economy, Sweden’s national currency can be influenced by multiple different factors. Sweden itself has very strong economic ties to many different sectors, such as telecommunications, pharmaceuticals, vehicles, and much more. The country’s economic roots are spread in a very diverse way, which has allowed the country to propel itself to high levels of prosperity.
The main trading partners of Sweden are the USA, Germany, the UK, Norway, Denmark, and Finland. Sweden itself has always made sure to be an exporter country, and it has been doing wonders for its economy. Now that we understand who the country is doing the business with and how to let’s discuss some of the main factors that play into presenting Sweden’s economy as it is, and how these factors are affecting its economy in various ways.
First and foremost, Sweden is dependent on the performance of the EU and its member counties, Germany more than anyone among them. The reasons are obvious, as these countries are Sweden’s biggest trading partners. Naturally, the strategic steps are taken and implemented by the Riksbank, also have their direct correlation on the condition of the SEK. Finally, seeing as SEK is a “risk-on” currency, changes to the price of oil also are a major factor affecting SEK.
These were, of course, only a few of the main examples. There can be tons of more things that can be a factor affecting the Swedish Krona. However, what you need to know is that there are always many opportunities to earn money by trading the Swedish Krona. The possibilities are abundant on the market, and the trader that is willing and able to take them has the world of opportunities available to them.
What else can you trade on with Sweden based Forex brokers?
While Forex currency trading is an amazing way to earn money in Sweden, the commodities are really where it’s at. No matter what kind of a specific type of a commodity you are looking for, it’s highly likely that you will be able to satisfy your needs when trading in Sweden.
The country has strong economic ties to natural resources such as iron and timber. As mentioned, oil prices are one of the main factors that affect the country’s currency, so trading on oil can prove to be really profitable in Sweden.
If oil is not really your thing, you can make use of Sweden’s opportunities in fields like telecommunication, pharmaceuticals, vehicles, and much more. Some of the best companies in the world are representing Sweden in these fields, so there is always a lot of possibility for a lot of profit. The industrial sectors, such as mining, engineering, etc. are in a very strong spot in Sweden right now, so you can expect some of the best opportunities on the global scale in these fields.
Which commodity/asset should you go for?
Well, it entirely depends on you. The best thing is to make sure that you are aware of all the important details and have a reasonably well-thought-out strategy before you choose your trading asset and proceed. Also, you have to make sure that your broker offers the necessary opportunities for the asset of your interest. As we mentioned, our list of recommended brokers is full of options that can all be a great choice for anyone, with all of them have gone through extensive reviews and screening.
What we would encourage you is to decide what kind of an asset/commodity you want to trade on, choose the broker that offers the best opportunities for your interest, and just start! Preparing and strategizing is important, but at the end of the day, you’ve got to just jump in and get started. And in Forex, the best time to get started is yesterday, and the second-best time is now!
So, what can we say about trading Forex in Sweden?
Despite not being a country with the biggest population and economy in the world, Sweden is definitely one of the best Forex markets in the world. This is thanks to their very strong economy, which is also very diverse, allowing for a lot of avenues to explore for each and every trader, despite what specifically they may be looking for.
These are what we believe to be the biggest advantages of the Swedish Forex market:
- Great regulatory environment
- Very high security
- Strong economy
- Opportunity for a lot of options to trade on
If you’re a Swede interested in getting started with Forex, then you can consider yourself lucky, as you have access to some of the best Forex opportunities in the world. Most importantly, you have the luxury of full peace of mind, thanks to Finansinspektionen’s amazing regulatory effectiveness. If you are looking to trade safely and securely while being a part of a great big Forex community and having access to all the opportunities for making money, then you are at the right place!