Contents
- 1 What are the best NFA regulated Forex brokers?
- 2 What is NFA and how does it work?
- 3 How is NFA doing its job and what are the NFA Forex brokers?
- 4 What are the guidelines that every NFA FX brokers should follow?
- 5 How to check if the broker is regulated by NFA or not?
- 6 Should you trade with FX brokers with NFA regulations?
National Futures Association, NFA, is an independent, non-profit, and self-regulatory body in the United States of America. It is responsible for overseeing the services that are provided by different firms in the derivatives market that includes everything from ETFs, Forex, and OTC derivatives. The body was established by the Congress of the US in 1982, with the aim to ensure fair practices and conduct from different types of financial organizations dealing with the general public.
The NFA makes sure that every single company that wants to provide derivatives related services to the citizens of the US is a member of the body and follow the strict standards and regulations that are created by NFA. These regulations are ever-changing and every single company should make sure to always check the updates and changes on the regulatory framework. These regulations are not created to only keep traders safe from scams but to also resolve any types of issues and problems between companies and consumers.
There are many NFA FX brokers in the United States, and actually, they are the only ones who can offer Forex trading opportunities to the citizens of the USA. No company that does not own the license from this regulatory body is allowed to offer Forex trading opportunities to US citizens.
In today’s guide, we are going to discuss everything about this regulator. So, if you are looking forward to starting trading Forex in the United States, follow our guide carefully!
What are the best NFA regulated Forex brokers?
There are dozens of different Forex brokers that own licenses from NFA and this can make choosing the best one a bit of a challenge for many. To make your job a lot easier, we have done very intensive and hard research on our own and came up with the list of the best Forex brokers that offer services to the citizens of the United States and that are authorized by NFA.
Licences
FCA, CySEC, IFSC, ASIC, DFSA
Min. depo
$5
Leverage
1:888
Platform
MT4, MT5, WebTrader
XM
Licences
ASIC, FSA, FSCA, FFAJ, FSRA, FSC
Min. depo
100 USD
Leverage
400:1
Platform
MT4, MT5
AvaTrade
What is NFA and how does it work?
As time goes by, the Forex market is becoming more and more popular around the world. With this popularity, modern technology has brought a number of scam companies on the market that is creating a very dangerous environment. To make sure that you are staying as safe as possible, you should always trade with Forex brokers that own official licenses. One of the best-known regulatory bodies around the world is the National Futures Association, NFA, which regulates Forex brokers in the United States of America.
The agency has been around for a long time now since 1982 to be exact, but it only started regulating Forex since 2008. The agency is independent of the government, which means that it is responsible for the supervision and regulations of all the Forex brokers in the United States without any interference from the government. The main aim of the company was to fight against the scam companies and financial malpractice.
Although NFA is an independent body, it still has to follow some of the rules passed by the US congress about the regulations of financial entities. It also has to work in accordance with the US Commodity Futures Trading Commission, CFTC. For funding, because of the fact that the agency is an autonomous organization, it is not funded by taxpayer money and is self-funded. This money is generated through membership fees and fines.
NFA represents the only regulator of the Forex market in the USA, which means that every single one of the Forex broker based in the United States should have a license of the agency. As of now, there are more than 4200 firms and 55000 associates under the regulatory framework of NFA. Because of the importance of the job that it does, NFA is very important for the whole financial sector in the USA, not just the Forex market.
How is NFA doing its job and what are the NFA Forex brokers?
Simply put, NFA Forex brokers are the companies that own license from NFA and that follows very strict rules and guidelines of the company. NFA has a very important job of protecting and maintaining the transparency of the financial market in the country. Also, they have to protect every single participant in the market. To ensure that everyone is stating safe, NFA is creating and implementing many different rules and regulations for all financial organizations that are under the oversight of NFA. To make sure that everything is done right, NFA is carefully checking every single detail about every broker that applies for authorization.
Once the NFA gives out the license than it has the obligation to make sure that all of the guidelines and regulations are implemented. To make sure that this happens as it should, NFA is doing different types of investigation to make sure that the brokers are in compliance with the rules that are set by NFA.
If the broker fails to follow any of the guidelines, they will be fined with huge fees. NFA claims that they have zero tolerance for scams or other kinds of financial misconduct and will do everything to make sure that the market is safe and secure for everyone. Although the agency gains a huge amount of their money from fines, they are doing everything in their power to educate brokers and tell them every single detail about regulations.
They are constantly coming up with new ideas and programs to help future Forex brokers to prepare for the guidelines that they will have to follow. The team behind NFA is constantly ready and willing to provide much-needed help to the members of the framework to comply with their regulations and are doing everything to create stability on the market.
Can traders make complaints about NFA regulated FX brokers?
One of the main jobs of this regulator is to make sure that every single one of the complaints from traders is taken seriously. They make sure to start an investigation on every situation as fast as possible. As of today, traders can send any type of complaint with the help of the internet very easily, from their official website.
They have been accepting complaints online since 2001 and they were the first once to do so. NFA works very hard to inform everyone on the financial market about the things that they should know for successful trading. You can very easily sign up for e-mail newsletters, enroll in different types of online classes and webinars to make sure that you have as much information about the Forex trading market as possible.
What are the guidelines that every NFA FX brokers should follow?
The guidelines set out by the regulator are very strict to ensure that brokers maintain a safe, secure, and transparent financial situation on the market. The guidelines are taken very seriously by the NFA and they are not afraid to impose hard penalties if companies decide to not follow any of the guidelines. These penalties include everything from huge fines, revocation of licenses, and in the worst case, even imprisonment.
So, if a broker wishes to operate in the United States, they should keep in mind that there will be a lot of guidelines that they will need to follow. First and foremost, brokers have to follow safe and transparent market practices. While NFA welcomes competition on the market, they also make sure that every single detail that is shown on the broker’s website is 100 percent truth without any misrepresentation. Another very important requirement is the operating capital that the broker will need.
The Forex brokers who wish to operate in the United States should hold at least $20 million in operating capital. This is a lot, especially compared to any other FX regulator around the world. It once again proves how strict NFA really is when it comes to Forex trading.
Also, like many other regulators, NFA demands that the funds of the clients are kept in segregated accounts to make sure that in case of a bankruptcy, the money of the clients is kept safe. Also, brokers have to submit weekly financial reports to the NFA, to ensure that everything is going smoothly without any violations. Other than these weekly reports, FX brokers also have to submit an audit report every year, which is available on the website of the NFA for everyone. This is a great thing for those who are looking for brokers to trade with since it offers a huge level of transparency and trust.
Something that really sets out NFA from other regulatory bodies around the world is the fact that every single one of the Forex broker authorized by the NFA is required to hire only trained and knowledgeable staff. NFA actively takes part in making sure that every single person is qualified for the position that they have while working for the broker. Below we have prepared a list of some of the best FX brokers on the market, take a look!
XM
Min. Depo
$5
Licences
FCA, CySEC, IFSC, ASIC, DFSA
Leverage
1:888
Platforms
MT4, MT5, WebTrader
AvaTrade
Min. Depo
100 USD
Licences
ASIC, FSA, FSCA, FFAJ, FSRA, FSC
Leverage
400:1
Platforms
MT4, MT5
Exness
Min. Depo
$10
Licences
CySEC, FCA, SFSA
Leverage
1:2000
Platforms
MT4, MT5
FundedBull
Min. Depo
49 USD
Licences
N/A
Leverage
N/A
Platforms
MT4, MT5, cTrader
Forex.com
Min. Depo
$100
Licences
NFA, CFTC, FCA, FSA, IIROC and CIMA
Leverage
1:50
Platforms
WebTrader, MT4, MT5
CMTrading
Min. Depo
250 USD`
Licences
FSCA
Leverage
1:200
Platforms
MT4, WebTrader, Copykat
Plus500
Min. Depo
$100
Licences
FCA, ASIC, CySEC, FSCA, FMA, MAS
Leverage
1:30
Platforms
WebTrader, Windows 10 Trader
How to check if the broker is regulated by NFA or not?
It is very important to be able to double-check the information that was provided by the broker. With the NFA, it is a very simple procedure and can be done in no time. You can easily check out the status of a certain broker via the official website of NFA. All you need to do is to provide the name of the broker, pool name, or an NFA ID number. If the broker is registered with the NFA, it is required that they show their ID number Ron their website, which makes it very easy to check.
Generally, the website of NFA is very helpful and user-friendly. You can find any type of information that you might need very easily without much of a work. The regulator makes sure that no matter what you need, you can find it very easily on their website.
Should you trade with FX brokers with NFA regulations?
If you are a Forex trader in the USA, you do not really have much of a choice. Every single one of a Forex broker should own a license from this regulator if they wish to do their job properly. Because of the NFA regulations, the field of Forex in the USA is very safe and you should definitely go with the brokers that own license from the NFA.
Over the years, the agency has proved that its number one priority is the safety and security of Forex traders in the country.