There are many scam brokers in the market. That’s why people aren’t in a hurry to start trading. In this article, we will tell you how to define a trustworthy broker from a fraudulent one, make your fears fade away, and trade happily after that.
Regulated and Non-regulated Brokers
To protect yourself, you should choose a regulated broker. Why is the request so strict? Let’s explain. A regulated broker is a broker whose actions are monitored by a regulator. Who is the regulator? It’s the type of supervision which aim is to prevent and investigate fraud in the market, keep it transparent and make sure that clients are treated with fairness, their funds are safe, and data is secure.
On the contrary, non-regulated brokers have no control of that kind. It creates opportunities for illegal market activities including unwarranted commissions, loose spreads, hidden Terms and Conditions, and even withdrawal restrictions. Traders and their funds suffer from this activity.
So, the best advice we can give you is to avoid brokers without regulation. The risk of trading with them is too high. You don’t have to take it because there are many licensed brokers whose services are reliable, and FBS is one of them. As a regulated broker, we can provide a significant level of protection. FBS operates following the policies, guidelines, and standards stipulated by Cyprus Securities and Exchange Commission (CySEC), license number 331/17.
What CySEC is
The Cyprus Securities Exchange Commission, or just CySEC, is the regulatory body for the financial industry. Its mission is to provide effective supervision to ensure trader protection. It is an independent regulatory authority that controls investment services and transactions in transferable securities carried out in Cyprus.
CySEC was launched in 2001 as a public legal entity, and then in 2004, Cyprus became a European Union member state. From that time, CySEC regulations and operations have had to meet the European financial regulatory framework’s terms.
What does all of that mean? CySEC operates under the branch of European regulators advocating for secure trading and therefore connects with European regulations such as the Markets in Financial Instruments Directive (MiFID) and The Markets in Financial Instruments Regulation (MiFIR).
MiFID and MiFIR are required for firms operating in the European Union. These European regulations are responsible for the transparency across the European Union financial markets.
Regulator is a Key
It’s essential to have a strong regulatory body such as CySEC to prevent money laundering and wrongdoing in the market.
The CySEC license is one of the most significant. People can rely on the companies regulated by CySEC because it guarantees protection and safety for investors and traders. The regulator monitors brokerage companies’ actions and transactions to ensure that they comply with the directives of the legal and regulatory framework.
Now we know more about the regulator, it’s functions and benefits. It’s high time to focus on the advantages traders take from working with CySEC regulated broker.
How a CySEC Regulated Broker Protects You
To avoid groundless arguments and excessive boredom of the theory, we want to show you the main CySEC pros by using FBS as an example. As a European licensed brokerage company, FBS meets all the requirements of MiFID and MiFIR.
So, why you should choose a CySEC regulated broker:
FBS operates in 31 European countries. As soon as you start working with the financial markets, you start economic relations. It’s a serious issue. But no worries, all your funds, and data that you provide FBS with stay safe.
The company is in full compliance with CySEC. Therefore, we ask you to go through the verification process. You upload a pack of documents identifying you, proving EU residency, and your financial status. It mitigates the risk of criminals using fake or stolen documents to open accounts and safeguard your identity and your assets. Moreover, verification is crucial for brokerage companies in fulfilling the legal and regulatory obligations to make the relations clear for its every side.
Transparency and fairness
Financial relations is a complex issue, as it was said before. That’s why transparency and fairness are of a high priority for a CySEC regulated broker. The regulator controls the reception, transmission, and execution of orders. If brokers fail to operate honestly, the regulatory body can impose penalties and sanctions on them. In this case, a broker is at risk of even losing the license.
To make services more lucid, CySEC has a list of brokers under its regulation. Just enter the name of a broker you are interested in and check whether it has a license.
Working with FBS prevents you from illegal practices such as tampering with the trading platform, price and commission manipulations, and client money withholding without any legal reason. The company also submits periodic financial reports to the regulator to prove the full transparency of its actions.
CySEC ensures that a broker is always ready to assist you in any situation, provide you with necessary instructions on trading, and a working support desk to resolve any problem you have. For such cases, FBS has a 24/7 support chat in your local language.
Moreover, we help you to master your money management risk skills. Before you start trading, FBS asks you to pass the survey to define your category: Demo or Retail. If you have a Demo category, you can trade in the real market conditions with no risks because it is just training when you aren’t experienced enough. We offer you free educational materials, expert webinars, and analytical articles to prepare yourself for the real trading. Three days after your last survey results, you can re-pass it for the Retail category and then dive into Forex trading.
If you’ve decided to become a trader, there are several aspects you should consider. Among them are spreads, leverage, and the general performance of the broker. But the most important thing is regulation. You are going to start trading with a company that will work on your behalf. In case you are a resident of the EEA country, the most relevant option for you is a CySEC regulated broker because it protects your interests on the highest level. Bear in mind, that FBS is a reliable and trustworthy CySEC licensed broker