Nordic countries are always regarded as a phenomenon of a kind, as a defining theme for most of them seems to be a success story of a strong and stable economy, and high standards of living – and Iceland is no exception.
The geographic location of this country does not necessarily call for guaranteed prosperity – a volcanically active land, which is mostly warmed by the Gulf Stream, it is hardly suitable for extensive agricultural production, however, the country successfully makes up for it with other natural resources.
In fact, Iceland has been named the seventh most productive country in the world, and the seventh most productive country by GDP per capita. In the sections to come we will have a closer look at the drivers behind the successful growth of the national economy, and what are the opportunities that it has to offer to the Forex traders.
As for now, let us give you a little bit of a general overview of this fascinating country. With a total territory of 102, 775 square kilometers, the country only has a population of 364, 134 people, which makes it the most sparsely populated country in the region.
Most of the population resides in the capital – Reykjavík, which, consequently, is regarded as the financial and economic center of Iceland. One can also assume that most of the Forex traders and brokers are also located there.
Although Forex trading is not that popular in Iceland, it is definitely very safe and properly regulated, and does have some unique features that a trader can take an advantage of. In the guide below, you will find some comprehensive information on what is the main regulatory body responsible or the Icelandic FX market, how are the local Forex trading brokers regulated, how can one find the best-regulated Forex broker in Iceland and more.
Although, as mentioned earlier, one can be sure that the Icelandic Forex market is very safe, it is, nevertheless, a complex task to find a brokerage that best suits your needs there. The most popular way of approaching it is spending a significant chunk of time on conducting research and assessing what your trading needs are – and which of the brokerages can best meet them.
In order to save you the trouble, we have decided to utilize the knowledge and skills that our team of experts is defined in order to examine all the brokerages available in Iceland today and find the best one for you. Below, you will find the complete list of the best Forex brokers in Iceland, their success rates, trading instruments, and the information about the license that they currently possess.
CySEC, IFSC, ASIC
CySEC, FCA, FSA
100 currency units
CIMA, FCA, NFA
As we have already mentioned, the national economy of Iceland is quite strong. This is particularly impressive since the country has made a long way to grow into what seems to be one of the strongest economies in the region, all while being regarded as one of the poorest in the 20th century.
The main component of the national economy is fishing, which makes up 40% of the countries export. On top of that, Iceland is the world’s largest producer of electricity. In an attempt to diversify the economy, the Icelandic government has put a significant investment in the development of the country’s science and technology sector, as well as the tourism industry, which is already catering to a significant number of visitors from all over the world, who are attracted by the infamous Icelandic whale watching.
The national currency of Iceland is the Icelandic króna, coded as ISK, which is regulated directly by the Central Bank of Iceland. The ISK is definitely considered to be an exotic currency, especially since Iceland is the second smallest country in the world that is using its own currency. Although not very popular on the international FX market, the ISK is quite often traded by the Icelandic traders, and usually in a pair with the USD.
As you can already tell, the economy of Iceland is quite diverse, and there are a number of features that one can definitely take advantage of. Similarly, one might find that trading the national currency might actually be quite profitable, however, if you a beginner, we recommend that you first try out trading some of the more popular currency pairs.
Moreover, if you are looking for the best online trading platform in Iceland, we suggest that you seek one that accepts payments in the ISK to avoid high commissions.
In an extension of the country’s overall commitment to customer protection and safety of the financial sector, the local FX market is strictly regulated. Below we will provide you with a breakdown of the main regulatory bodies that oversee the legit and smooth functioning of the Forex trading brokers, as well as the main functions that they perform.
Firstly, the Icelandic Forex brokers are directly managed by the Financial Supervisory Authority ( FME) that sets out rules for every company involved in the financial sector. This entity is an extension of the Central Bank of Iceland, and its main aim is to ensure sustainable development and safety of the country’s financial market.
Secondly, as mentioned earlier, the Central Bank of Iceland is a body that single-handily oversees and issues the country’s monetary policy and regulates the exchange rates. The latter is especially high on the agenda, ever since Iceland has suffered some devastating effects of the 2008 global financial crisis.
Finally, although Iceland is not an official member of the EU, it does fall under the regulations of the local bodies, as it is still a part of the European Economic Area (EEA). Similarly, the local Forex regulations are guided by the standards issued by Europe’s Markets in Financial Directives Authority (MiFID) and the European Securities and Markets Authority (ESMA).
Overall, one can definitely say that it is very safe to trade Forex in Iceland, however, some repercussions still need to be taken. For example, one should never blindly trust the information that the brokerage provides, and always check it against the regulatory body that it is licensed with.
Providing bonuses to their respective traders is a common tool of marketing that brokerages from all over the world use to both expand and sustain their customer base. There are two main bonuses that one can expect – either the welcome or the refill ones.
The former are gifted as a token of appreciation to the traders who have only just signed up with the brokerage. In turn, the refill bonuses are the tokens of appreciation that are issued periodically to the returning clients and are usually announced in advance.
When it comes to Iceland, the provision of such bonuses is strictly prohibited in abidance with the standards released by the MiFID and the ESMA. Nevertheless, there are other, much more beneficial trading instruments that one can expect the best Forex platform in Iceland to provide. Among them is the availability of leverage, which can ultimately multiply your trading returns.
When it comes to the trading software that the Icelandic brokerages resort to, one can definitely note that there is a variety available. However, among the most popular ones are the cTrader, MetaTrader4, and MetaTrader5. The latter is especially advisable both to the beginners and the experienced traders alike, as they are defined by both their efficiency and the user-friendly interface, and you can easily find loads of information on how to best use it.
Similarly, the payement options in Iceland are quite diverse. You can choose anything from debit and credit cards ( Visa, MasterCard) to e-wallets and PayPal. Another payement that is becoming increasingly among the Icelandic traders is SEPA, which allows creditors to get payement directly from the user’s bank account.
When talking about the specifics of the Icelandic FX market, it is impossible to overlook the option of mobile trading. If you are seriously committed to trading Forex, you will definitely appreciate the accessibility of the trading sessions at all times, which ultimately means that you can always react to the relevant market developments. If this future is important to you, then we suggest that you have a careful look at the top Forex brokers list that we have provided earlier to determine which one of the brokerages there offers it.
The combination of Nordic rationality and the European commitment to customer protection is probably what makes up for the success recipe of the Icelandic national economy. Although the local FX market is not yet high in popularity, it is already extremely safe and properly regulated – which is already more than many other, bigger markets across the world, manage to achieve.
If you are a citizen of Iceland, we can easily recommend that you explore the opportunities of trading within the conditions of your national economy. However, we suggest that you approach the choice of brokerage wisely and only sign up with the regulated Forex brokers in Iceland.