Singapore is a financial powerhouse in Asia that is responsible for at least $300 billion worth of Forex transactions occurring within a single trading day, making it one of the major players in the Forex markets. Singapore is known for its business-friendly attitude and high standards of living, which qualifies the country for being one of the most sought after investment destinations in the entire world. Singapore can be an expensive affair for expats; however, the country has nevertheless attracted numerous businesses from all sectors, including financial companies and Forex brokers.
The Monetary Authority Of Singapore (MAS) is the sole Governmental agency responsible for regulating and supervising the activities of Forex brokers in Singapore. The MAS also acts as the central bank and a financial regulator for all financial firms that currently operate out of Singapore. MAS regulated brokers should follow all regulations as stipulated by the Government and should be able to tweak their operations to suit any changes in regulatory frameworks as advised by the Government. The MAS has a long and illustrious history in the financial markets and has been a significant presence in the financial markets since 1971.
The MAS assumes the responsibility of maintaining the stability of the Singapore economy, but the Monetary Authority of Singapore does not play a direct role in the regulation of the economy, which is carried out by other components of the Singapore Government. Unlike other central banks, the MAS does not influence any rate change decisions or affect the Singapore Dollar (SGD), but the central bank does have the right and authority to function as a banker to Government agencies as well as other financial entities.
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Forex Trading In Singapore
Singapore is attributed as the fifth largest Forex center in the world; after the global heavyweights that include New York, London, Europe, and Japan. Singapore is one of the biggest economies in the world and has a higher per capita than some of the other larger and more established countries.
Singapore is a small Asian nation that has quickly established itself as a major contributor to the global financial markets through its regulatory reforms and affinity to modifying its economy to suit the global markets. Forex trading is gaining enormous popularity among local investors as well as expats that have a substantial business presence in the country.
Although Singapore does not impose any large restrictions on Forex trading, there are several subtle differences in trading such as a higher margin requirement and some limitations on automated trading strategies. Otherwise, MAS does not limit the freedom enjoyed by traders while investing in the Forex market.
The MAS Regulatory Guidelines For Forex Trading
Forex brokers in Singapore enjoy a free and transparent marketplace that is free from any major interference from MAS or any other Government agency. The MAS stipulates a core set of regulatory rules in its operational framework that is adopted by more than 1000 major financial institutions and other private companies in the financial sector. The MAS has made it compulsory for Forex brokers to obtain a valid MAS license to be able to operate in Singapore.
The MAS issues licenses after analyzing the core fundamentals of a company and by understanding its operation protocols to ensure that the entity follows all existing laws of the nation. The MAS has complete authority over its regulated members and can award or revoke licenses according to the conduct of a MAS regulated member in the financial markets. MAS Forex brokers are continually supervised and audited for their performance, and MAS is very consistent in its regulatory oversight when it comes to protecting the rights of its consumers and investors.
All brokers are required to provide periodic audit reports to the concerned authorities, and Forex brokers regulated by MAS should hold their client funds in separate accounts. MAS does not allow its regulated brokers to mingle client funds with their operating capital, which helps the regulatory agency to ensure that the broker does not misuse client funds for any other purposes. Forex brokers in Singapore are also expected to have no conflicts of interest with its clients, and should not tamper with the platform or price feeds. If any broker is found to have indulged in any activity that created a non-favorable trading condition for a trader, the MAS is quick to impose substantial penalties on the broker, and the broker also faces the risk of having their license revoked.
Singapore has an elaborate regulatory framework that is designed through its MAS Act. The MAS Act is regularly amended and reviewed to incorporate new regulations and recommendations according to the changes in the Singaporean as well as the global economy. The MAS Act is further divided into several sub-categories that are specifically designed for each financial component, and the Singapore Government has created an extensive framework of rules that incorporates all aspects of regulating the different financial firms operating out of Singapore. A
lthough traders are free to choose international and overseas Forex brokers for their trading and other investment goals, Forex brokers in Singapore should be regulated by the MAS and have a valid Capital Markets Service License. The authorities have explicitly requested investors from Singapore to deal with MAS regulated brokers so as to ensure a safe and secure trading environment. Choosing an overseas broker forgoes a trader’s right to receive any assistance of financial aid in tackling financial scams, which can prevent the investor from approaching the Singapore Government for any problem resolution.
How To Determine The Authenticity Of MAS Regulated Forex Brokers
The MAS has an official website that provides all information on regulated entities and the rules that govern financial entities. The online resource is a great avenue for ensuring the authenticity of Forex brokers in Singapore and by verifying the regulatory licenses to prevent traders from falling into financial scams. The MAS also has a zero tolerance policy towards consumer abuse, which has helped the central bank of Singapore to earn the trust and confidence among a majority of investors from Singapore.
Traders should use the fantastic MAS online portal for staying abreast with the Singapore financial environment, as it is usually the best platform for learning about scams or industry warnings that are aimed to protect investors from any financial crimes. The Singapore Parliament is highly committed to deterring financial scams, and Singapore enjoys one of the lowest cases of broker scams or other financial malpractices. The MAS also enforces strict anti-money laundering laws that prevent brokers from freely transferring money to any other country without following the proper protocols.
Being a financial hub, Singapore is expected to be a pioneer in the field of regulations and to ensure the safety and integrity of its investors. Therefore, Singapore is certainly one of the best countries if you are looking for a safe and reliable broker.
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