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Forex Trading Japan 2018

Forex trading in Japan is really popular. Japan has one of the highest amount of retail Forex traders in the world. 

The official FX regulator in japan is  now  FSA Japan, which stands for Financial Services Agency Japan over its old name – JFSA – Japanese Financial Services Agency.  

There are only a handful of retail Forex brokers in Japan that dominate the market. Japan’s retail Forex market has the lowest leverage in the world, which is set at a maximum of 25:1. Though the most recent update coming to Japanese brokers is a move to lower the leverage from 25:1 to 10:1. 

The new rule is expected to be introduced in the middle of 2018. The Japanese Financial Services Agency or  FSA Japan doesn’t encourage Japanese residents to open Forex trading accounts with brokers overseas, they goes as far as labeling them as “scams”. This is overly blown out of proportion.

For more information on FSA Japan rules and regulations visit there website: https://www.fsa.go.jp/en/

That is why many Japanese Forex traders choose a regulated FOREIGN broker, so they are able to trade with higher leverage and receive other benefits that are not available to FSA Japan regulated brokers.

We have compiled a list of overseas Forex brokers that accept residents of Japan – See below.

fsa japan

The top retail forex brokers that dominate the Japanese market are listed below (FSA Japan Regulated):

 

  • GMO Click Securities
  • DMM Securities
  • YJFX
  • Rakuten Securities
  • Gaitame.com

Other FX brokers that accept Japanese residents but are not FSA Japan regulated can be found below:

ic markets
Broker TypeECN
RegulationsASIC
Min Deposit$200.00
Account Base CurrencyUSD, AUD, EUR, GBP, CAD, JPY, NZD,CHF, SGD, HKD
Max Leverage 500:1
Trading PlatformsMetatrader 4/5, cTrader, Webtrader, API Trading, MAM / PAMM
blackbull markets
Broker TypeECN
RegulationsFSCL and FSPR
Min Deposit$200.00
Account Base Currency USD EUR GBP AUD NZD SGD CAD JYP ZAR
Max Leverage 500:1
Trading PlatformsMetatrader 4
tickmill
Broker TypeNon Deal Desk (NDD)
RegulationsFCA
Min Deposit$25.00
Account Base CurrencyUSD, EUR, GBP, PNL
Max Leverage 500:1
Trading PlatformsMetatrader 4, Webtrader
fxchoice
Broker TypeECN
RegulationsIFSC
Min Deposit$100.00
Account Base CurrenyUSD, EUR, GBP, AUD, CAD, BITCOIN, GOLD
Max Leverage 200:1
Trading PlatformsMetatrader 4/5

Exactly why do Japanese traders choose to go with a foreign FX broker?

There are a few reasons why Japanese traders go for foreign brokers. The reasons are mainly to circumvent the strict regulations which some traders found unfavorable although FSA intention for imposing those restrictions is to ensure better safety for traders. Below are some of the reasons:

  • Higher leverage – Japanese regulated brokers offer a maximium leverage of 25:1, where as overseas brokers can offer up to 1000:1 leverage.
  • Negative balance protection – The JFSA, now known as the FSA Japan, do not allow brokers that operate within japan to offer clients with Negative balance protection.
  • Bonuses – Japanese regulated FX brokers cannot advertise or offer special deposit bonuses and offers
  • Trading restrictions – Most fore brokers in Japan place restrictions on trade. Traders who want to trade with certain strategies like Hedging, scalping, arbitrage and EA trading are restricted.
    The key reason for the restriction is that the majorities of Forex brokers that operate in Japan are OTC brokers. More than 80 percent of Forex brokers in Japan operate through the OTC model. This means to stay in business and not file for bankruptcy, their traders have to lose money through trading. The trading environment is thus not perfect but restricted by brokers. The implication is that the traders gain is the brokers’ loss and the brokers gain is the traders’ loss.