Forex Trading in South Africa - ZAR Brokers
Forex trading involves predicting whether currency values across the world will rise or fall. Correctly predicting how a currency value shifts can result in a profit. Is Forex trading legal in South Africa? Yes! In 2017, the daily forex trading rate in South Africa was estimated to be around USD 19.1 billion.
South Africa’s currency, Rand (ZAR), is also in the top 20 of the most traded currencies in the world. In 2016, it was estimated that R1,012,263,000,000.00 were traded. There is an increased appeal surrounding Forex trading because the market is open 24/7, has high liquidity, and Forex trading is quick-paced.
Despite the appeal, there are risks associated with Forex trading, as there are with any type of investment opportunity. To prepare you to enter into the world of Forex trading, we’ve described how to trade Forex in South Africa and various forex brokers in South Africa.
Start trading with IQ Option & invest your RANDS smartly!
How do you trade Forex in South Africa?
Getting started with Forex trading in South Africa is relatively simple and does not take long. All forex investment companies in South Africa have a similar process, so the process outlined here will fairly be the same across all the platforms you use.
Though the aspect of setting up an account and executing trades is simple, most experienced traders will tell you that 90% of trading involves preparation. To prepare, you will do a lot of research to understand what influences currency values and how they fluctuate over time.
Though the “buy low/sell high” mantra is the most common forex trading strategy, it’s not the only game out there. Carry trading occurs when you hold currency in a forex account, and it accrues interest. Different currencies will yield different interest rates.
Binary options are all or nothing options, meaning you will determine if the currency value will either rise or fall,l, and if you predict correctly, you’ll win a set amount of money. Shorting occurs when you borrow currency from someone, sell it while it’s valued high, then buy back later at a lower price. Shorting is risky because if the currency value does not drop like anticipated, you’ll still be on the hook for the cost.
One can make money from forex trading through carry trading, binary options, or shoring; aside from the preparation and types of trading, the following outlines the steps to setting up an account.
First, you’ll want to ensure you have a strong internet connection. Nothing is more frustrating than trying to execute a trade only to find that your internet is experiencing severe lag. Next, you’ll want to determine the best forex broker for you.
Luckily, we’ve done that research for you and have outlined the best FSB-regulated forex brokers in South Africa. Some online brokers have desktop platforms while others have mobile platforms; you can choose whichever meets your lifestyle. Once you’ve selected an online broker, you’ll go through the steps to opening the account. Again, these steps are relatively the same across all online brokers – enter your information, verify your identity, deposit funds into the account.
Some platforms will provide new users with a demo account equipped with virtual money so that users can practice strategies before committing to actual trades. After your account is set up and funded, you’ll be ready to trade.
Which broker is the best for Forex in South Africa?
Many stock brokers are available in South Africa, and the best stock brokers in South Africa will largely depend on trader needs and initial capital. You will also want to find a regulated broker through the Finance Service Conduct Authority (FSCA) and forex brokers with zar accounts. The following is a list of top regulated Forex Brokers in South Africa that support zar.
What is the best South African Forex broker for beginners?
If you are new to the trading and investment world in general, then look for online brokers that have demo accounts as a rule of thumb. Demo accounts will allow you to practice before trading with your money. Some brokers also have an excellent variety of educational resources, which is an added plus that you should search for. As the cliche goes, knowledge is power, and in this case, knowledge can help boost your earnings.
AvaTrade, The top forex broker, provides a free demo account you can use ! Use it.
How much money do you need to start trading Forex in South Africa?
The ideal amount of money needed to start trading Forex is more than one may think. Although there are online Forex accounts that will allow for trading with as little as $1, starting with such a minimum amount may not be the best for long-term gains.
In terms of Rands, the minimum amount to start Forex trading is right around R2,800. Some traders have been successful with R200 starting off, but it takes longer to accrue meaningful gains with smaller amounts. Experts suggest that you trade 1-2% of your deposited funds, so if you start with a lower deposit amount, then it will take longer for you to start earning substantial amounts of income.
Though it’s not impossible to begin with, lower deposit amounts it is much more challenging.
In sum, Forex trading is a popular trading option for those located in South Africa, and the popularity is only continuing to grow. The process of executing trades is relatively simple, but trades should engage in thorough preparation to ensure they are making strategic and educated trades.
Remember to look at things that influence the value of currency across countries. Typically, economies, commodities, and politics influence currency values, so it would be helpful to keep up to date on the latest world news.
We hope that all of this information has helped serve as a jumping-off point as you dive into the world of forex trading in South Africa, happy trading friends!
Join eToro community & start your trading journey now!