FAQ
Frequently Asked Questions
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All Forex brokers based in Australia must become authorised by the Australian Securities & Investment Commission (ASIC), the Australian financial markets regulator.
What is ASIC?
The Australian Securities and Investments Commission (ASIC) is a regulator in Australia established in 1998 and is one of the Top-tier Regulatory authorities in the world, with strict procedures and thorough monitoring. ASIC is not a government run organisation, however it’s responsibilities include regulating and overseeing leveraged foreign exchange transactions, financial service markets, and the overall protection of retail clients.
What does ASIC do?
- Regulates company and financial services including banks, credit unions and mortgage and Forex brokers, and enforces laws to protect Australian consumers, which includes Forex Traders.
- Carries out daily supervision of the retail foreign exchange market, with a focus on combating misconduct within the financial markets while fostering trust, improving performance, and upholding integrity.
- Investigates and takes legal action against individuals and entities that break financial laws. (ASIC is able to impose penalties, and sanctions, and enforce civil and criminal proceedings. This is helped by the fact that ASIC works closely with other regulatory agencies, such as the Australian Competition and Consumer Commission (ACCC), Australian Prudential Regulation Authority (APRA) to ensure regulatory cooperation and effectiveness.)
When was ASIC established?
ASIC was established in 1998 as a national regulatory authority
Where can I find further information about ASIC?
ASIC’s website is asic.gov.au.
What protection does ASIC provide Forex traders?
ASIC provides many protections afforded by a trusted regulatory jurisdiction such as efficient compliance and enforcement of regulations.
Is Forex trading legal in Australia?
Yes, Forex trading is legal in Australia and is regulated by ASIC. (Australian Securities and Investment Commission), which supervises and regulates financial markets and ensures that brokers are complying with the Corporations Act of 2001.
Australian Dollar
Forex traders will be aware of the Australian dollar (AUD) as Australia’s national currency (often referred to in the forex world as “the Aussie”), with the AUD/USD being one of the more commonly traded currency pairs in the global forex market.
Forex markets and Australian forex brokers are affected by the monetary policy as regulated by the Reserve Bank of Australia (RBA), which issues and manages the Australian dollar overall.
The RBA ensures the stability of Australia’s national currency, and provides oversight to risk in the financial system and works on growing. Australia’s overall economic success.
The main stock market in Australia is the Australian Securities Exchange (ASX), located in Sydney. The ASX’s markets offer a broad range of asset classes that include equities, futures, derivatives, exchange-traded funds (ETFs), exchange-traded products (ETPs), and commodities.
Is Forex Trading Taxed in Australia?
Yes, Australian citizens and residents must list any income from trading in Australia – this includes any profits earned from forex trading. Alongside this, any losses from trading forex can be recorded, depending on how your tax professional files your tax return, as well as whether you are trading Forex as an individual or under a business name.
Can I trade forex with a small amount of money?
Yes, you can trade forex with just $100. However, your ability to do so will be dependent on two factors: minimum deposit requirements and contract size availability at your chosen broker. To start trading forex with for example $100, you’ll need to ensure the broker allows you to open a live account with a small minimum deposit, and it’ll also need to let you trade micro lot contracts $100 (just 1,000 units of currency). Thankfully Many forex brokers allow minimum deposits of $100, and will offer micro contracts once you’ve opened a live account to trade forex.
$100 might seem like a small amount of money for trading and investing, but it is actually very common for forex traders to start their trading journey with small deposits in order to practice with the features of a platform. If you want to see some low-cost options for trading forex, have a look at our Best rated Brokers.
ForexZone Top Tip
Open a demo account to firstly learn how to use your broker’s trading platform. You can practice your chosen forex strategy using virtual money before entering any real (live) trades. Once comfortable, you can move on to live trading with the real balance in your live account.
How do I get started trading forex in Australia?
If you want to begin trading forex in Australia, it’s critical to start your forex journey by choosing a forex broker that is well-regulated and properly licensed in Australia by the Australian Securities and Investment Commission (ASIC). There are five essential steps to get you started as a Forex Trader in Australia:
- Choose a reputable brokerthat is properly licensed and regulated by ASIC by verifying their credentials on the ASIC website.
- Familiarize yourself with your broker’s trading platform.Check out all available mobile and web apps and explore all your broker’s trading platforms (ForexZone recommends starting out with your broker’s free demo account).
- Fund your trading accountusing the available deposit methods that are most suitable for you. PayPal has become a popular way to fund forex trading accounts, -as it has a massive international presence with a broad range of supported currencies.
- Create your trading plan.Even the best traders can lose money, but the key to long-term success lies in sticking to a trading plan that keeps your average losses low (in relation to your average profits).
- Place your first trade.Choose your preferred trade size, and open a long position by clicking buy on a given currency, or open a short position by clicking sell. You have now entered the world of Forex Trading.