Top Forex brokers in Romania, and how to find them

Romania borders Bulgaria, Ukraine, Hungary, Serbia, Moldova, and the Black Sea to the southeast. Upon joining the European Union in 2007, Romania has come a long way to boost its economy and financial sector to meet the standards of the EU. The country is still using its national currency (Romainian Leu) coded as RON, and is projected to adopt Euro once the country fulfills needed conditions.

As of right now, the country has a population of over 19 million people. Romania has long become and still remains to be one of the regions’ most attractive destination for investors from all over the world. The EU membership helps the economy of Romania modernize, and industrialize. With the advancements in the economy, interest in financial investing and active trading increases. Forex and CFD (Contracts for Difference) trading in particular is becoming more and more popular in the country. In this guide, we’ll discuss all you need to know to pick the best broker in Romania.

Our recommendations for top Romanian Forex brokers

The broker selection process can be lengthy and stressful, as there are so many brokers that need to be compared. In addition, traders need to take into account various factors, such as: regulations, fees, platforms, available assets, and customer service. To aid you in this process, we’ve reviewed multiple brokers and created a top list.

Forex trading regulations in Romania

The main regulatory body that oversees the smooth functioning of the entire financial sector of Romania is the Romanian Financial Supervisory Authority or the Autoritatea de Supraveghere Financiară (ASF). The regulatory body was created as a result of the merging of a number of outdated bodies – Private Pension System Supervisory Commission (CSSPP), National Securities Commission (CNVM), and the Insurance Supervisory Commission (CSA). The main functions of the ASF include ensuring security, smooth functioning, and development of the insurance, pensions, investment, and Forex trading market in Romania.

The regulator is completely autonomous and reports directly to the Romanian Parliament. Moreover, it operates in a way that incorporates both the standards issued by the European Securities and Markets Authority (ESMA), as well as the regulations specifically for the specifics of the Romanian FX market. It is clear that the body is functioning in the most efficient way possible, as trading Forex is becoming more and more popular in Romania. We will now provide you with a detailed assessment of what are the specific regulations imposed upon the Forex trading brokers in Romania.

In order to be able to offer their services in Romania, local brokers need to obtain their license from the ASF. The process of doing that is quite complex and time-consuming, however, in the long run, it is extremely beneficial both to the brokers and traders alike. When it comes to the former, having a license from the official body automatically elevates the brokers’ prestige and attractiveness to the potential traders, as the license clearly shows that the brokerage is both qualified and suitable to operate on the market. In turn, traders that choose licensed brokers automatically acquire that additional layer of security, and confidence that in case of something not going well, they will have the ASF step in on their behalf.

It should also be mentioned that since Romania is an EU member state, European regulations regarding Forex and CFD trading are applied in the country. In particular, financial markets in Europe are governed by the Markets in Financial Instruments Directive (MiFID).

Regulatory requirements on Contracts for Difference and leverage

Use of leverage is strictly controlled in the EU. High leverage is associated with increased risks. Leverage helps traders increase their purchasing power, and as a result, potential for more profits. On the downside, high leverage often leads to devastating results, especially for beginner traders. For this very reason, leverage is often called a double-edged sword. According to the EU directives, in Romania, brokers are not allowed to offer more than certain amount of leverage:

• 30:1 – for major currency pairs
• 20:1 – for non-major currency pairs, gold and major indices
• 10:1 – for commodities other than gold and non-major equity indices
• 5:1 – for individual equities and other reference values
• 2:1 – for cryptocurrencies

Financial safety measures

Brokers operating in the country are required to offer negative balance protection, which guarantees that traders will not lose more money than what’s on their trading balance. In addition, brokers are required to keep deposits made by their clients in segregated bank accounts. Account segregation adds safety, as even if the broker is liquidated, traders will be able to receive their money back. Moreover, brokers operating in the EU, need to be a part of the compensation scheme.

Popular trading platforms in Romania

It’s important to select the right trading platform when starting the trading journey. The most popular Forex trading platforms are MetaTrader 4 (MT4), and cTrader. However, these platforms do not support multi-asset trading. In addition to Forex and CFDs, if you are planning to trade stocks, futures and options, you should go for the MetaTrader 5 (MT5). MT5 is a multi-asset software, more advanced than the MT4, however, a bit more complex. All three platforms come with mobile and web terminals, and support automated trading using algorithms.

Summary

Overall, Forex trading in Romania is becoming increasingly popular. The activity is regulated by the Romanian Financial Supervisory Authority (Autoritatea de Supraveghere Financiara – ASF) in the country. However, it should be mentioned that the number of local brokers is very limited. On the upside, residents of Romania can open trading accounts with international brokers, such as XM, Plus500, AvaTrade, and more.

FAQs on top Forex brokers in Romania, and how to find them