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“Regulated” is the least informative word on a broker's homepage. Every firm in this industry is regulated by someone; what differs enormously is what that someone requires — the capital the firm must hold, whether client money is legally segregated, whether you can lose more than you deposited, and whether anybody pays you back if the firm fails. A licence from one authority can be worth an order of magnitude more than a licence from another.
This directory profiles the 16 authorities that license the overwhelming majority of retail forex and CFD activity. For each one you get the retail leverage cap, the compensation scheme and its ceiling, whether negative balance protection is mandatory, the client-money segregation rule, and the complaints route that exists when the broker stops replying to email.
| Regulator | Jurisdiction | Tier | Max retail leverage | Compensation limit | NBP | Brokers listed |
|---|---|---|---|---|---|---|
| ASICAustralian Securities and Investments Commission | Australia | Tier 1 | 1:30 | Not applicable | Yes | 0 |
| BaFinBundesanstalt fuer Finanzdienstleistungsaufsicht (Federal Financial Supervisory Authority) | Germany | Tier 1 | 1:30 | 90 percent of the claim, capped at EUR 20,000 per investor | Yes | 0 |
| CBICentral Bank of Ireland | Ireland | Tier 1 | 1:30 | 90 percent of a client's net loss, capped at EUR 20,000 | Yes | 0 |
| CFTCCommodity Futures Trading Commission | United States | Tier 1 | 1:50 | Not applicable | No | 0 |
| CIROCanadian Investment Regulatory Organization | Canada | Tier 1 | Set by margin rates rather than a flat cap | CAD 1,000,000 per client per account category for property held by an insolvent member | No | 0 |
| FCAFinancial Conduct Authority | United Kingdom | Tier 1 | 1:30 | GBP 85,000 per eligible person per firm for investment business | Yes | 0 |
| FINMASwiss Financial Market Supervisory Authority | Switzerland | Tier 1 | No statutory cap | CHF 100,000 per depositor per bank, covering deposits rather than trading positions | No | 0 |
| FSA JapanFinancial Services Agency of Japan | Japan | Tier 1 | 1:25 | Not applicable | No | 0 |
| MASMonetary Authority of Singapore | Singapore | Tier 1 | 1:20 | Not applicable | No | 0 |
| NFANational Futures Association | United States | Tier 1 | 1:50 | Not applicable | No | 0 |
| SFCSecurities and Futures Commission | Hong Kong | Tier 1 | No statutory cap | HKD 500,000 per investor, covering exchange-traded products on Hong Kong's recognised markets | No | 0 |
| CySECCyprus Securities and Exchange Commission | Cyprus | Tier 2 | 1:30 | EUR 20,000 per covered client | Yes | 0 |
| DFSADubai Financial Services Authority | United Arab Emirates (Dubai International Financial Centre) | Tier 2 | 1:30 | Not applicable | Yes | 0 |
| FMAFinancial Markets Authority | New Zealand | Tier 2 | No statutory cap | Not applicable | No | 0 |
| FSCAFinancial Sector Conduct Authority | South Africa | Tier 3 | No statutory cap | Not applicable | No | 0 |
| SEBISecurities and Exchange Board of India | India | Tier 3 | No retail OTC forex permitted; exchange margins apply to listed currency derivatives | Set by each recognised exchange for claims against defaulting members, subject to published per-investor limits | No | 0 |
NBP = negative balance protection. “Brokers listed” counts the brokers reviewed on PipDig that hold this licence.
Tiering regulators is a judgement, not a formula, but it is a judgement with concrete inputs: minimum capital requirements, whether client money must sit in a statutory trust or segregated account, whether a compensation scheme pays out on firm failure, whether an independent ombudsman can force redress, and how visible and enforceable the public register is. A tier-1 licence does not make a broker good — it makes the downside of a broker failing much smaller.
Tier 1
High minimum capital, enforced conduct rules, a public register that is genuinely policed, and an independent complaints or compensation route that pays out when a firm fails. These are the licences worth paying a wider spread for.
Tier 2
Real supervision and a public register, but thinner capital requirements, a smaller compensation ceiling, or a retail regime that leans on the home regulator of a passported entity. Perfectly usable, with more homework required.
Tier 3
Licensing exists, but there is no compensation scheme, no leverage cap, or the regime simply does not contemplate retail margin FX. Treat the licence as a minimum bar rather than a guarantee.
Clone websites and “licence borrowing” are the two most common frauds in this industry, and both are defeated by five minutes on a public register. Never take a licence number from the broker's own footer at face value — start at the regulator's register and work back towards the website.
If the answer to any of those is unclear, ask the broker in writing before funding. A firm that cannot name its regulating entity and licence number in a single sentence is telling you something useful. Glossary definitions for the concepts above are in the forex glossary.