Is It Worth Trading with The Maltese Forex Brokers?

The Republic of Malta is an archipelago in the Mediterranean sea, right next door to the South of Italy, Tunisia, and Libya. Being located at the crossroads between Europe and North Africa, it seems like this island state has combined the best of the two worlds and ended up with a unique, vibrant culture and fascinating ancient history. For a long time, this country has primarily served as one of the most popular travel destinations, and thousands of tourists from all over the world were attracted by its antique architecture, picturesque scenery, and great nightlife. However, it was not until recently that Malta became known for something other than being a popular vacation spot.

With the entire territory amounting to 316 square meters and a population of over 475, 000 people, Malta is the 8th most densely populated countries in the world. Although the country’s national economy has never been particularly viewed as a shining example of success, it has definitely come a long way to become what it is right now – stable, fast-developing, and full of opportunities. Such a notion is no accident, as the Maltese government has been very dedicated to leveling up the national economy, and making the local economic environment attractive to both the local and foreign investors. As a result of such continuous efforts, almost every major segments of the Maltese economy has flourished in the last few years, and the local Forex trading market was no exception. In the guide that you are about to read we will discuss the best Forex brokers in Malta, the main regulatory body that oversees the smooth functioning of the FX market, and the opportunities for profits that the traders can benefit from.

Maltese Forex brokers we chose for you

Choosing the broker that is right for you is never an easy task – this is the statement, that we never cease to repeat in each and every single one of our guides. The choice that you end up making will be the single most important deciding factor when it comes to your security and the profits that you make. Although there is no single formula on how best to approach choosing the broker that will ultimately suit your trading best, one can definitely agree that the process will require a lot of time and effort, as well as a significant amount of research that you will have to conduct. In order to rid you of some stress that comes with this entire procedure, we decided to provide you with a complete list of the best Maltese Forex brokers, that both meet all the requirements of the local regulatory body and offer you the best Forex trading platform in Malta.

XM Group

XM Group Forex Review

Minimum deposit

5 USD

Licences

CySEC, IFSC, ASIC

Maximum leverage

1:30*

US Clients

No

Forex.com

Forex.com Review

Minimum deposit

100 currency units

Licences

CIMA, FCA, NFA

Maximum leverage

1:200

US Clients

Yes

IQ Option

IQ Option Review – can the broker be trusted?

Minimum deposit

10 USD

Licences

CySEC

Maximum leverage

1:1000

US Clients

No

License and regulation of top Maltese brokers

In an attempt to boost the majority of the sectors of the national economy, Maltese authorities have undertaken numerous measures to make the overall environment of every local market attractive and full of potential. Similarly, when it comes to FX trading, the regulations that are currently in place aim to strike the perfect balance between ensuring the security of customers and not limiting the market’s sustainable development.  Having assessed the way in which the local regulatory body oversees the smooth functioning of the Forex trading brokers in Malta, we can definitely say that it does a great job of, if not achieving, then definitely getting very close to the perfect balance that we have mentioned above. We will now go into some more detail about what the main Maltese regulatory body is and what are the main regulations that it imposes upon the local Forex trading market.

Malta Financial Services Authority (MFSA)

The main regulatory body in Malta is the Awtoritàgħas-Servizzi Finanzjarji ta’ Malta, or the Malta Financial Services Authority ( MFSA). Created back in 1988, this entity has been undergoing a lot of changes, with the most significant being the assumption of the responsibilities of the Malta Financial Services Centre, Central Bank of Malta and Malta Stock exchange. The MFSA is completely autonomous and reports directly to the Maltese Parliament. On top of that, the body enjoys a large amount of power in the country’s financial sector. The MFSA has the power to regulate, monitor, and oversee the smooth and secure functioning of the financial sector, as well as advise the government on the relevant policies and instigate investigations into the potentially harmful and illicit practices.

The main sectors that the MFSA oversees are the securities market, insurance, pensions, banking, investment, and, of course, the Forex trading brokers in Malta. When it comes to the main strategy that drives the operations of this regulatory body, it is mostly revolved around two key factors  – consumer protection and ensuring the market’s growth and expansion. Given the overall state of the country’s national economy, the financial sector, and the Forex market in specific, it is easy to see that the body is doing an amazing job of meeting both of its key goals. We will now have a closer look at how the MFSA manages to remain one of the most efficient FX regulatory bodies in Europe.

What would it take you to get the MFSA license?

The Forex trading brokers in Malta who wish to offer their services to the local traders are required to obtain an official license from the MFSA. In order to do that, the broker will have to demonstrate that they are sufficiently qualified to operate in this fast-growing market. Moreover, after the license is obtained, the MFSA continues to closely monitor its licensees to ensure that the requirements that it put forward are met at all times. This is achieved via constant audits and reviews that the brokers have to submit for the MFSA’s periodic reviews. Such reports mostly, but not exclusively, focus on the breakdown of all financial activities, traders’ success rated, and many more.

Moreover, European brokers who wish to operate in Malta are also permitted to do so and are not required to obtain a license from the MFSA. Although this might seem like a recipe for disaster and a potential security issue, it truly is not. Malta is a part of the European Union (EU) and, thus, the regulations issued by the MiFID extend onto it. What this means is that the European brokers, that have already obtained a license from any other EU-based regulatory body are fully permitted to provide their services in other EU member states, although they would, however, be required to notify the MFSA of their intention to do so.

The public must know everything about a broker!

Before we go deep into discussing the specific regulations that the MFSA implements to directly control the efficiency and transparency of the Maltese Forex market, we would like to address one additional measure that the organization undertakes for the purpose of protecting local traders. This regulatory, along with many others in the region, realizes that it’s crucially important that the traders have a clear understanding of what the FX market encompasses, how it operates and what are the potential risks involved. For the purpose of making this information accessible and widespread, the MFSA utilizes various channels to get the message through. The most efficient and comprehensive among those is probably the organizations’ website, where a trader can find the complete breakdown of the relevant information on the country’s FX market, Forex trading brokers in Malta, and potentially risky tools of trading, such as leverages and the Contracts For Difference (CFDs).

A required level of operational capital

One of the most common regulatory measures that various entities demand their licensed brokers to abide by is the minimum operating capital that the broker needs to possess in order to provide its services. This particular regulatory measure is a great way for the MFSA and other entities of a similar nature to ensure that the broker is not operating on the verge of bankruptcy, and, indeed, is a legit broker as opposed to being a scam scheme. When it comes to Malta, brokers there are required to possess a minimum of 730 000 EUR, and, in order to obtain the license from MFSA, they need to provide sufficient paperwork that proves it. Although simple at first sight, such a measure did actually prove to be highly effective, as the amount of con artists among the legit Forex trading brokers in Malta has reduced drastically.

Qualifications of the senior members of staff and management

On top of the more common, widely used regulatory measures, many countries tend to come up with their own, more nuanced conditions, for their local brokers. This is no surprise, since every Forex market is different in its own way, and, since it relies hugely on the human factor, is often subjected to the cultural differences and the country’s unique mentality. Similarly, the MFSA has adopted a measure that caters specifically to the needs and basic security of the Maltese traders.

The introduction of certain standards for the qualifications of the senior members of the brokerage, its team of experts, directors, and relevant shareholders is the best way to make sure that only the profound professionals are allowed to offer their services in the country. Prior to giving out a license, the MFSA carefully reviews the staff of each of the Forex trading brokers in Malta and bases its decision on whether or not they are good enough to become its official licensee.

Reporting violations and encouraging investigations into illicit activities

The resurgence of FX market regulations has definitely put an end to the extreme influx of the scam schemes and frauds that occurred within it. However, the unfortunate truth is that no amount of regulations will be able to get rid of the con artists once and for all. It is, therefore, extremely important for the countries to have an efficient reporting mechanism in place, that will allow any individual to point a finger towards a malicious broker or the illicit activity that they either witnessed or experienced. The trick to this is not only having a simple and accessible channel for whistleblowing but also investing in creating a safe environment where a person can report a violation without having to fear retaliation that will inevitably follow. The MFSA takes special pride in being able to provide such channels, and successfully reducing the number of Forex trading scams with efficient monitoring of the regulated Forex brokers in Malta.

Are bonuses allowed in Malta?

Even the best of the best Forex brokers in Malta or elsewhere in the world are in constant search of the new traders to expand their client base. There are a variety of marketing tools and promotions that the broker can use to appear more attractive to its potential clients. Among them are the bonuses that many brokers gift to traders to kickstart their respective trading sessions. There are two main types of bonuses – the welcome and the refill bonuses. Welcome bonuses are usually gifted to the new traders for signing up with a broker or upon making the first deposit. On the other hand, refill bonuses are issued periodically to the returning clients as a token of appreciation from their broker.

For many, the availability of such bonuses is the deciding factor on whether or not is worth joining the broker. It is, therefore, necessary to say that Forex trading brokers in Malta, like in many other European countries the provision of such bonuses is strictly prohibited. Nevertheless, the are many other tools that are no less beneficial and that many of the Forex trading brokers in Malta can provide.

How to get started with Maltese brokers? – Final conclusion

Anyone who has reached the age of legal adulthood, and has managed to meet the requirements of their respective brokers will be able to start trading in no time. Moreover, the cost of getting started is no cost at all. What we mean by that is that there are no additional fees or costs of actually joining the broker, however, you will be required to make the deposit that you will later use in your consequent trading session. The amount of minimum required deposit varies depending on the broker that you end up choosing, and some of the top Forex brokers in Malta might be asking for as little as 5 USD, while others will require a minimum of 500 USD.

The short answer to that is yes, definitely. The opportunities that this fast-growing market has to offer cannot and should not be overlooked. The local regulatory body, MFSA, does a terrific job at both ensuring the smooth functioning of the local FX market and the consistent dedication to consumer protection. The process of licensing also translates into only the best and most qualified being able to offer their services in the country, and, the list of top Forex brokers in Malta continuous to grow simultaneously with the market itself. If you are a citizen of Malta and thinking about trying out trading Forex, we highly recommend that you give it a go!