Forex trading has become a very popular form of investing for the retail sector over the last few years. High leverage and liquid markets have dramatically increased the interest in forex trading around the world. This has lead to regulators and governments regulating forex trading and it has become illegal in a few countries around the world. Some countries have regulated forex so highly that it’s nearly impossible to trade for a living. With that being said, is forex trading legal in Singapore?
Forex trading is completely legal in Singapore. Traders from Singapore are allowed to use any broker, not just brokers based locally in Singapore, opening up a huge amount of possible brokers. The Monetary Authority of Singapore are the governing body regulating the Singapore forex industry.
Forex Trading In Singapore – The Law
Good news for traders – forex trading is legal in Singapore. Not only is it legal, forex in the country is regulated by the MAS (Monetary Authority of Singapore). Having regulation is a great way to ensure that traders can stay safe within the markets, even though some traders may see regulation as a bad thing.
Forex is growing massively within Singapore and it’s rapidly becoming a powerhouse in the forex markets. Conditions are actually perfect right now for traders as the MAS have still got leverage for traders sitting at 1:500 as a maximum, meaning traders are able to generate huge potential returns even with lower amounts of capital.
Unlike in some countries, traders in Singapore are not required to only trade in the base currency of SGD (Singapore Dollars). This opens up the whole currency market to traders and allows the use of all trading pairs. Not only are all pairs on the table, commodities, crypto and all brokers are all on the table as well.
Unlike trading in India, crypto trading has remained legal in Singapore over the last few months and MAS have been fairly clear on their liking of cryptocurrencies. Crypto is still a fairly new industry in Singapore and it’s only been formally allowing exchanges since 2020, so I would advise keeping a tight eye on the regulations as I’m sure they will be changing over the coming months as the industry grows.
Tax For Forex Traders In Singapore
Tax is something that is often slept on by retail forex traders and it definitely needs to be taken seriously. If you’re a professional trader in Singapore, tax will need to be dealt with through an accountant unless you have knowledge of tax within the industry.
For retail forex traders, brokers in Singapore are under no obligation to report your profit and losses. This is great news but does mean that if you’re a profitable trader you will still need to deal with your taxes. I would highly advise consulting with an account if you’re consistently making profits within the industry and are Singapore based.
Choosing A Forex Broker In Singapore
When you’re trading forex, you will need a broker in order to execute your orders within the markets. There are thousands of brokers out there, all offering a different range of perks and trading conditions.
In Singapore, traders are able to use any broker they desire. Although Singapore based brokers need to be regulated by the MAS, traders are not obligated to only use Singapore based brokers. This is great news for traders as you’re able to use the best brokers in the industry, without having to worry about breaching regulations.
I would still highly advise you use a regulated broker like IC Markets, just to keep yourself safe from being scammed.
ForexBrokers.com have a very handy list of all of the top brokers for Singaporean traders. I would definitely recommend giving it a read if you’re hunting for the best broker. I would recommend trying to trade with a MAS regulated broker, if you’re given the option.
The Best Prop Firm Funding For Singapore Traders
Luckily, prop firm trading is completely legal in Singapore. Physical prop firms come with different regulations because that may push you into the bounds of being a professional trader, but online prop firms like MyForexFunds are extremely simple to setup.
There currently aren’t any leading prop firms setup in Singapore, which is a shame. However, the MAS don’t require traders to only use financial companies based in the country, meaning you are legally allowed to use online prop firms based outside of the country. Also, with the growth of the financial industry in Singapore over the last few years I would very much imagine that a prop firm may setup shop there in the near future.
I would personally recommend using a prop firm with more a global reach, if you’re looking for funding in Singapore. For instance, FTMO has a very much worldwide presence and offers funding of up to $400,000. I have used FTMO for years now so have a read of my full review here if you’re interested.
Why Is Forex Trading Becoming So Popular In Singapore?
Singapore is rapidly becoming a powerhouse in the forex trading industry. This is for a number of reasons… Firstly, the forex industry is just rapidly growing over the last few years. This is mainly due to social media and more people working from home than ever, people are spending more time trying to grow side businesses and grow their incomes online.
Secondly, Singapore is one of the only countries in the world that boasts a triple A credit rating. This shows the strength of the economy in the country.
Thirdly, there is a huge amount of perks of trading within the country. Tax is lenient for retail traders and the MAS allow brokers to offer up to 1:500 to Singaporean traders. This means that the barrier of entry to trading is very low compared to other markets and the potential to earn large profits is much more than within other industries.
Lastly, there is a great deal of education in Singapore. The country has great education in general, let alone in the forex industry. Some of the best retail traders I have met over the last 5 years have learned the skill in Singapore and there’s a huge amount of in person seminars taking place each year. I know that Asia Forex Mentor has a huge reach in the country and there are many more on YouTube too providing free education.
In Summary – Can You Trade Forex In Singapore?
In conclusion, it is completely legal to trade forex in Singapore. The Monetary Authority of Singapore do not require traders to use a Singapore based broker, so you’re able to use any broker you wish. Leverage is high at a maximum of 1:500 which provides perfect conditions for traders. Cryptocurrency is also completely legal in Singapore since 2020.
If you have any more questions regarding trading in the region please do drop a comment down below and I will do my best to answer any query.