Here are the best Forex brokers in Malaysia, compared and reviewed. When comparing brokers we look at group regulation, trading conditions, bonuses, platform support and reputation.
|– Best FX Broker Asia Award 2017
– Flexible up to 1000:1 Leverage
– Lots of informational resources
|$30 welcome bonus for all clients (T&Cs apply)|| CySEC
My experience with FXTM
FXTM is an impressive broker who understands how their clients want to trade online. The platform choice is wide, fast trade execution, the customer service is responsive, and the trading conditions don’t get much better. FXTM offers swap-free Islamic accounts and is willing to make sure your entry into Forex trading is a great one. I hope you enjoy FXTM as much as I have over the years.
|– Regulated in Malaysia
– Best FX Broker Asia Award 2017
– 1000:1 Leverage
– Lots of educational resources
|$30 welcome bonus for all clients|| FSB
My experience with AvaTrade
Avatrade is a fully regulated broker in Malaysia with good educational resources and support for MT4. What I appreciate with Avatrade is the combination of good leverage, a low minimum deposit, and tight spreads; this setup will give you a good starting point for successful trading. Avatrade offers mobile trading so if you want to trade on the go, this could be a good feature for you.
|– Ultra-thin spreads as low as Zero Pips making trading even more profitable
– Minimum deposit 5$ for Micro and Standard accounts and 100$ on Zero accounts
|$30 No Deposit Bonus and then 50% up to $500 and 20% up to $5000 of bonus||IFSC||Open Account
My experience with XM
XM is a fantastic place to trade. The technology and the analysis tools are all there for you to make the trading day easy and a lot of fun. The zero account option that we recommend here offers ultra-thin spreads and some even with zero pips which makes the trading even more profitable. Trade with MT4/MT5 on your desktop, with webtrader in your browser, or with apps on your Android or IOS mobile phones.
|– Leading beginner broker
– Easy to use platform
– 400:1 Leverage
– Available to Malaysians
|50 USD|| CySEC
My experience with Etoro
Etoro has social trading as a central component of this platform. This allows you to find successful traders or those who have the same approach to trading, and you are able to follow and mimic their trades. Weekly promotions, welcome bonuses, good leverage and quality technical analysis make Etoro a contender for this list of respected brokers.
||55% bonus on all deposits – not just the initial one.||None||Open Account
My experience with InstaForex
InstaForex is an extremely popular brand in Malaysia offering a generous bonus and good trading conditions, and I don’t have much negative to say about it. I first tried InstaForex years ago because it was one of the few ECN brokers available with high leverage and an MT4 connection. Most spreads are fixed so risk management is easy to do, but then again, there are no big wow factors to this broker. If you are looking for a regular broker, with fast trades and good platforms, then InstaForex should be on your shortlist for consideration.
|– Free Signals for Forex Malaysia signups!
– Works with MetaTrader platform
– 400:1 Leverage
– Offers a mobile version of the platform
– Available to Malaysians
|50% Bonus up to $2000|| CySec
My experience with Easy Markets
EasyMarkets is wonderful for the new trader because they really do roll out the welcome mat. The offer free trading signals to our clients, which is a huge help to any trader. They also offer education and set you up with an account manager to make sure you understand the ropes before you start trading for yourself. The technology is smooth, you can trade on mobile, and their deal cancellation feature has saved me a couple of times.
Choosing a Forex broker
When it comes to real accounts, brokers will sometimes have different tiers of accounts for you to select from. Based on how much capital you intend to deposit with the broker, the account size will be bigger, and you will get more access to account managers, data, signals and ultimately lower spreads and higher leverage.
Brokers usually have demo accounts, which are free accounts where you can practice your strategies and trading, and real accounts that are funded by your bank account or credit card.
A demo account is particularly for beginners as well as for the professionals for testing different trading strategies. Some demo accounts will be time-limited, where after your demo period you will be encouraged to sign up for a funded account. Most brokers allow you to keep your demo account once your real account is created.
The spread is the difference between the buying price and the selling price. It is with this difference that a broker makes their money. Different brokers will offer different spreads and the difference is often determined by the kind of broker you are going to trade with, and also the deal they have with their liquidity provider.
Leverage is additional capital borrowed from a liquidy provider which enables traders to open larger positions than would normally be possible with their existing account balance. It is presented as a ratio – example 50:1.
Leverage is used because the movements in the currency markets, so if traders did not have access to leverage the gains would be too small. Brokers usually offer leverage anywhere from 200:1 to 800:1, depending on what liquidity provider they are doing, and also dependent on your experience as a trader. When it comes to leverage, traders need to be very careful and understand it well.
Leverage is important to understand because it can either work for you or against you. It’s advisable that for retail traders with a little experience to be careful with the amount of leverage that you use in your trades because the risk exposure can be significant. As your trading history grows, and the broker sees that you are trading successfully, they could offer you increased leverage on your account.
Brokers have different minimum deposits starting as low as $5 and going up to $500. I would always recommend that you consider that you only want to deposit an amount of money that you are comfortable losing because while trading can be very successful, it can also be very unsuccessful.
Available Tools at Forex Brokers
Brokers usually offer forex tools like calculators, economic calendars as well as trading signals so that you have all your trading information in one view. The main tool that any trader will be using is either MetaTrader 4 or 5 or the platform that is offered by the broker for the purpose of researching and enacting the trades.
When you sign up with a broker, ask the account manager what tools you will have access to for free, and which they will charge you for. This is often posted on their website, but having this discussion with the broker before you have made your first deposit will get you more from them for free.
It is important that you choose a broker that offers customer service since you will be able to communicate. It is safe to say that all brokers offer customer service 5 days a week, it is only the more advanced accounts that will give you access to a dedicated account manager and weekend assistance.
There is a controversy about if giving bonuses away for first-time traders should be allowed. Some regulators in Europe have decided that it should be stopped, while others around the world still allow it. That said, some brokers offer bonuses based on the amount that you deposit to your account, and others give you offers or run tournaments. Some offer no deposit bonuses to get you started.
Important note: do not rely on bonuses because they are often come with fine print and are used as a mechanism to drive in new customers. You will not be able to withdraw them.
Types of Forex Brokers
Before you sign up with a new Forex broker, it’s important to understand that not all Forex brokers are the same as they’re structured on different trading models and make money in different ways.
The Forex Brokers can be separated into two major categories:
- Dealing Desk Brokers (DD) or Market Makers;
- Non-Dealing Desk Brokers (NDD) which can be divided into two categories:
- Straight Through Processing (STP);
- Electronic Communication Network + Straight Through Processing (ECN+STP);
Dealing Desk Brokers
Dealing Desk Brokers, also called market makers, is where the broker sets their own price rates for currency transactions. In essence, a Dealing Desk Broker will fill their clients’ trades by taking the counterparty of the trade. This means the Forex Broker trades against its own client base.
In a Dealing Desk environment, there is obviously a conflict of interest because the Forex broker makes money not only from charging you a spread but they also profit from your losing trades. However, the main advantage of choosing a Dealing Desk Broker is that they require a very low amount of money to open an account with.
Non-Dealing Desk Brokers
The Non-Dealing Desk market environment is designed to give you true pricing and true execution with no price re-quotes. A Non-Dealing Desk Broker will automatically offset and then transfer your orders directly using the Interbank market. This allows you to bypass the dealing desk and only trade against the market.
Unlike the Dealing Desk Broker, a Non-Dealing Desk Broker will not keep clients’ orders internally, which means there is no conflict of interest. However, the main disadvantage of a Non-Dealing Desk Broker is that the minimum amount to open an account is usually higher.
ECN Forex Brokers
ECN is derived from Electronic Communication Network and is a trading network focused on the execution of currency transactions in a direct manner. The price quote you receive from your broker is derived directly from the Interbank market. An ECN broker will give traders the opportunity to interact with each other as the buy and sell transaction are matched by the liquidity providers.
The main benefit of using an ECN Forex Broker is the fact that you have access to the Interbank market, but the main disadvantage is that if there is not enough liquidity to execute your order, you’ll often get re-quotes.
ECN+STP Forex Brokers
STP is derived from Straight Through Processing and this type of Forex Brokers operates in a Non-Dealing Desk environment. An STP Forex broker operates the same way as an ECN broker does, but the only difference is that it’s processing orders in a more efficient way. Unlike an ECN broker, an STP broker can also act as a Market Maker if your order cannot be executed in the Interbank market. This will ensure that your order will not get re-quotes and you will almost certainly you’ll get your order filled.
The main disadvantage of an STP Forex Broker is that you’ll receive dynamic (varying) spreads that connected to market volatility and available liquidity.
Is the forex broker a non-dealing desk or dealing desk broker?
A dealing desk forex broker is one who interferes with your orders, by monitoring them and then often places a trade against their position. On the other hand, the non-dealing desk broker offers you direct access to the foreign exchange markets. The main difference between the two is that the dealing desk brokers usually have fixed spreads while non-dealing desk brokers have variable spreads as they are getting the rates from a liquidity provider.
Forex Commissions and Spreads
Commissions and spreads are the costs of doing business in the Forex market. These costs are charged by the brokers per trade as a fee in return for executing orders.
The first, and main source, of income for brokers, is the two-way quotation system. Generally, when you’re looking at a quote and deciding whether to buy or sell a currency you’ll notice that the broker will give you two quotes: the Bid and the Ask price.
The bid price is the price at which you sell, while the ask price is the price at which you buy. The asking price will always be greater than the bid price. The difference between the bid price and the ask price is called the spread.
If the quotes of the spreads are very small, or what is called tight, that means they are very competitive. If the spreads are wide, the broker is trying to make more money from their customers who trade these pairs. It can be that the pairs have very little liquidity or that the broker is trying to make additional profits from their customers who trade these pairs.
In order to make money as a trader, you have first to overcome the spread. Forex brokers generally offer two types of spreads:
- Variable spreads: which is determined by currency pair liquidity and market volatility.
- Fixed spreads: which are pre-agreed in advance by your broker and are not influenced by market conditions. Fixed spreads are usually found for the major pairs with higher liquidity and sometimes limited to certain account types.
To read more about spreads and what the spread tells you, we have an article here.
Generally, commissions in Forex trading are similar to the spread in the sense that they are charged on every order placed. Unlike the Forex spread, commissions aren’t determined by either market volatility or by currency liquidity, but by your broker. Forex brokers generally offer two types of commissions:
- Fixed commissions: The standard pricing structure offered by the majority of Forex Broker is around $3 per each $100k notional value trade. Usually, you’ll have to pay a commission both when you open and close a position, so it’s the full round turn cost that we have to keep in mind.
- Variable commissions: This commission pricing model is determined by your total turnover, in other words, your total volume traded. With the variable commissions, a broker may also charge the volume commission rate based on the account balance and the total volume traded.
The bottom line is that no matter what type of the fee structure you prefer there is one certainty – there is a cost of doing business in the Forex market. Additionally, you have to consider that aside from the transactional costs of trading there might be some extra costs like data feeds fee, overnight rollovers and other hidden fees that some obscure broker might have. Our team at Forex MY has put together a list of what we consider are the best retail Forex Brokers available for you, and a list of Islamic Swap-free accounts available.