Forex trading is completely legal in Canada. But before going with any broker, be sure the broker is licensed by the IIROC or authorized locally by a regional regulator.
Forex, or foreign exchange, can be defined as a network of buyers and sellers who exchange currencies with one another at a set rate.
Forex trading is similar to trading in stocks or other securities; it involves trading one currency for another. The main goal of forex trading is to accurately forecast whether the value of one currency will rise or fall in relation to the other.
Forex trading is completely legal in Canada, just like in other countries. However, the laws and regulations can appear more complex. In Canada, the Investment Industry Regulatory Organization of Canada (IIROC) oversees the forex trading market in this country on a federal level. Additionally, there is a regulator for each region of the nation.
The 3 provincial organizations that control foreign exchange in Canada are:
The Ontario Securities Commission (OSC) is an independent agency that regulates the forex market; it is not a part of the government. The Ontario Securities Commission has been given official approval by the FTRACC to act as a regular, but a supplemental, regulator of Canadian Forex brokers.
British Columbia Securities Commission is also an independent regulator for Forex trading in Canada. There are currently 10 commissioners on this commission, and their job is to protect brokers, financial institutions, and personal information from various types of fraud and scams.
Autorité des Marchés Financiers (AMF) is the body in charge of overseeing financial regulation in the Canadian province of Quebec. The AMF's goal is to uphold the laws regulating the financial sector, particularly in the areas of securities, deposit institutions (other than banks), and the distribution of financial goods and services.
One can trade foreign currencies through any number of forex brokers in Canada. The broker must be registered with IIROC or authorized locally by a regional regulator.
Sign up on the broker's website to open a forex trading account. You will have to provide basic personal information, such as confirming your identity, trading goals, risk tolerance, and source of capital for verification, and after that, you will be ready for forex trading.
Forex trading is not restricted in Canada, but you must be aware of the regulatory bodies and eligibility requirements for forex trading. Make sure you have all the necessary paperwork and confirmation on hand for the verification.