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To guide Filipinos in understanding how to access
Forex legally, this article will answer the following questions:
Is Forex Trading
legal in the Philippines?
How do I become a Forex trader in the Philippines?
What are the Forex Regulations in the Philippines?
How much money do I need to start trading Forex in the Philippines?
What are the Pros and Cons of Trading Forex in the Philippines?
Top Forex Brokers1 Get Started 74% of retail CFD accounts lose money Is Forex Trading Legal in the Philippines?
Yes, Forex trading is legal in the Philippines, but the Filipino regulators have made it difficult for a domestic Forex industry to develop. In 2013, they issued a statement suggesting that trading in Forex was illegal. Since then, they have allowed Filipinos to trade Forex, but in practice, they must rely on overseas brokers. Let's examine this further Are the Forex Regulations in the Philippines?
Here's what there is to know:
You may have read that the Philippines central bank, the Bangko Sentral ng Pilipinas (BSP), has licensed a few dozen“Foreign exchange/money changers” to conduct currency transactions. This gives the impression that there are“BSP-licensed Forex Brokers” that Filipinos can use to trade Forex. However, the authorized institutions are not online Forex brokers with charting platforms offering leveraged Forex pairs for speculation. Instead, they convert currencies for business or travel needs. The process is like entering a bank branch and asking to convert currencies from your bank account or physical cash-it is now how Forex traders operate.
Since there are no domestic Forex brokers that Filipinos can use to access the speculative Forex market, traders in the Philippines use overseas Forex brokers. While the Philippine Securities and Exchange Commission (SEC) and BSP discourage this, they have not ruled against individuals using foreign brokers.
The BSP has warned against specific brokers that market to Filipinos because they are concerned about unethical practices or fraud. I recommend avoiding these brokers Much Money Do I Need to Start Trading Forex in the Philippines?
Forex brokers in the Philippines offer accounts requiring a minimum deposit of as little as $100 (even less in some cases). Once you meet the minimum deposit requirement of your selected broker, you can start trading.
Of course, a smaller account size means smaller trade sizes. You may need more than the minimum account size to make the profitability worthwhile. If I start with a $100 account and double it over the year, it is an excellent percentage return, but a $100 profit over a year is not worth my time.
How Do I Become a Forex Trader in the Philippines?
Here are the most important steps:
Find a broker accepting Filipino clients.
Because of SEC and BSP regulations, you will probably need a foreign-regulated broker to fulfill your trading needs. I recommend using one from a well-regulated jurisdiction such as the US, Canada, UK, or Australia. These jurisdictions require Forex brokers to operate at the highest standards, with strict reporting and trade execution requirements, and most importantly, providing segregated accounts , holding client funds separate from their operations.
Test a trading strategy or copy trading service on a demo account.
Nearly all brokers offer a demo account without requiring a live account first. First, see if you can make money with a demo account. This phase is critical to your learning process: you will find out the percentage of your trades that are profitable and the size of your profits compared to your losses, how long losing streaks last, how many trades you get a month, etc.
If you are happy with your demo results, open a live account.
Don't rush in with your total savings and risk too much per trade because of a period of profitable demo trading. Start with small trade sizes on a live account and build up as profits accumulate.
Keep a trading journal and keep learning.
Trading is a continuous journey of improvement. Keep records, find out if you can improve, and learn from other traders-whichever trading method you pick, there will be traders posting about it online to help speed up your development Are the Pros and Cons of Trading Forex in the Philippines?
I have been an active Forex trader for more than a decade. I have profited from the markets, and it pays for my lifestyle. Because of that, I am biased and will have more pros than cons on my list! But I will try to remain as objective as possible
The Forex market operates 24 hours a day, 5 days a week. That makes it convenient to look at the markets around work or family commitments.
The most liquid time for Forex is the New York Open, which runs from 8 p.m. to 11 p.m. PhST. Filipinos with day jobs can easily trade the New York Open in the evenings, and it is not too late to disturb most people's sleep cycle. (I have friends in other time zones where the New York Open is in the middle of the night, and it is nearly impossible for them to trade during this time.)
Forex is leveraged. Trading with leverage allows me to control a large amount of currency with a small deposit or“margin.” For example, if my Forex account gives me 50:1 leverage, I can control $50,000 in currency with a $1,000 margin, amplifying my gains.
I do not need any special qualifications or licenses to open a Forex account with a broker. It is open to anyone.
Many Forex brokers have small minimum account sizes, such as $100, making it affordable for almost anyone to get started.
Forex is highly liquid. This matters because liquid markets have lower trading costs (such as spreads) and can be more easily traded on smaller timeframes, for example, by short-term traders looking to capture daily moves. Technical analysis is also a more reliable tool in liquid markets because it relies on crowd psychology as its foundation.
Because of Forex's popularity, many courses and educational materials are available for those who wish to learn how to trade.
Trade copying services allow customers to copy the trades of an experienced trader with a track record. The world's most popular Forex platform, MetaTrader , offers trade copying from thousands of traders (yes, thousands!) that anyone can copy for a subscription fee.
The opportunities given by the Forex markets are independent of the state of the economy. A recession may affect the country and create job losses, but the Forex market will give daily opportunities to make money. This is probably my favorite aspect of Forex and what initially drew me to it.
Demo accounts allow anyone to experiment to ensure they can be profitable and work through early mistakes without risking real money
Leverage increases risk because it amplifies losses as well as gains.
There is a lot of bad information published online about trading. It took me a long time to learn to verify claims about trading methods and systems.
There is a huge psychological element to trading that many struggle to master. When real money is on the line, people lose discipline and do not follow their strategy. For example, they take profits too early or hold on to losses too long (the opposite of what successful traders do).
People expect Forex to be mechanical. But there is nuance and discretion involved. Even when someone trades a system with objective rules, sometimes market conditions mean those rules do not work, and a trader must recognize those conditions and decide whether to adjust or not Line
While Forex trading is legal in the Philippines, Filipinos must rely on foreign brokers to access spot Forex for trading purposes with leverage and charting platforms. I recommend sticking to well-regulated countries that require brokers to operate at high standards to protect client funds and deliver fair trading execution. My preferred jurisdictions are the US, Canada, Australia, and the UK. The Philippines is in an excellent time zone for Forex because the most liquid time, the New York Open, is in the evening, which many people with day jobs can trade.
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