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The dollar bill is one of the most active and outstanding currencies in the world, and that is why it is also in the most traded currency list. In fact, it takes part in more than 85 percent of Forex trade volume. US-$ is the world reserve currency. All major currency pairs contain US dollar on one side – either on the base side or quote side. Forex market is the largest market in the world, and it is growing with every passing day.
In case you are planning to start a trading career in Forex market, it is essential to find the best USA Forex broker in the market. And the decision shouldn’t be taken lightly. But at the same time don’t stress over it as there are many potential Forex brokers in the USA that have your back. With Best10forexbrokers.org, you can reach some of the top US Forex brokers.
I recommend you to check out my article called Dealing Desk and Non-Dealing Desk Forex Brokers.
Although the USA trading market offers enormous trading opportunities, it is challenging to protect retail traders from financial scams. That is why regulations were introduced for the Forex traders and brokers to control the risk and loss protection. For example, all Forex brokers in the USA should be registered with NFA. Let’s see what National Futures Association is.
National Futures Association (NFA)
NFA was created in 1982 to protect investors from deceitful Forex activities. And according to US Forex law, any person or entity that conducts business within the exchange market should be registered with NFA as a member. This ensures that the brokers follow the set of rules introduced by NFA. Members of the NFA also required paying membership dues so that NFA can remain completely independent.
Once registered with NFA as a member, a background screen of the member is performed after which the member can conduct business. The rules and regulations do not only benefit the investors, but it also ensures the market integrity. The NFA monitors the members to make sure that all laws are being abided by them. Further NFA has the authority to take action against the members who violate the rules and regulations.
Financial Industry Regulatory Authority (FINRA)
FINRA is another independent and non-governmental regulator for the firms that do business with the public in the United States. The mission is to protect the investors by regulating the brokers and by monitoring trading on US stock markets. FINRA enforces high ethical and moral standards for Forex brokers in the US that enhances the investor safeguards and market integrity.
These ethical standards are followed by the necessary resources and expertise for the regulations. With these basic protections, every investor can now rely on the fair financial market. FINRA ensures that the product or broker is tested, qualified and licensed and the advertisement of the product is truthful and not misleading. FINRA also educates the investors about the market transparency and rules so that the chances of frauds reduce to a maximum.
Securities and Exchange Commission (SEC)
SEC is a federal government agency that is responsible for maintaining fair security markets and to protect investors from scams. SEC oversees the investment advisors, dealers, organizations and Forex brokers in the US and promotes fair dealing and protection against frauds by establishing rules and regulations. There are various laws included in SEC’s disposal to accomplish its objectives. SEC monitors US Forex brokers and companies to make truthful statements and treat investors with honesty and fair manners. SEC was established during the Great Depression to encourage the confidence of the investors by providing the reliable information.
Securities Investor Protection Corporation (SIPC)
SIPC also lies in the list of non-profit corporations with the same goal of protecting the investors and clients of brokerage firms that are facing bankruptcy. All the dealers and brokers including Forex brokers are required to be registered under the securities exchange act of 1934. To break it down for the readers, SIPC ensures that the investors get protection on their money in brokerage firms that are facing bankruptcy.
When the brokerage firm goes bankrupt and is registered by SIPC then the cash and securities held by the firm may be protected up to $500,000 including a $250,000 limit for cash. Security investor protection covers most types of securities that includes mutual funds, stocks and bonds. To protect your payments, you are required to make payments to the firms and brokers that are members of SIPC. Send checks to the business address of the firm and never make a check out of sales representative.
Federal Deposit Insurance Corporation (FDIC)
FDIC is an agency US federal government that conserves the confidence of the public in banking systems by iensuring their deposits. This agency was also created during the great depression in response to bank failures and losses to the bank customers. FIDC examines and supervises around 4000 banks for safety and soundness. FDIC responds immediately when a bank fails to protect the insured depositor. To promote and preserve public confidence, FIDC identifies, monitors and addresses the risks deposits. It only insures the deposits and does not insure mutual funds, securities and similar type of investments.
These are some of the agencies and corporations that work for the benefit of investors. Registering with these corporations decreases the risk of frauds. And will provide protection for brokers that are registered and verified by these authorities and corporations. The process of choosing the right Forex broker in the US has become very easy as you can find a trusted broker on our site. That has the permission to provide trading services to the US citizens. These authorities oversee all Forex trading activities in the United States. The key thing to consider about these institutions is that their regulations are based on legal and ethical procedures of online trading community.
Remember that there are authorities that are working to make the trading process easier for you. And we are making an effort to help you in reaching those potential Forex brokers in the US that can maximize your output. Now you know about the rules and regulations that a qualified and authentic Forex broker has to follow. We wish you good luck on choosing the right broker and to enjoy success in the trading market.