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Pakistan is a country in south Asia.
The currency of Pakistan is the Pakistani Rupee (PKR).
When it comes to retail forex trading activity in the country, the Securities and Exchange Commission of Pakistan (SECP) is the primary regulatory body overseeing and ensuring that practices within the sector remain transparent, fair, and in line with the national financial regulations. SECP’s mandate not only covers the forex trading domain but also extends to other areas of finance and capital markets, emphasizing the protection of investors and the development of a modern and efficient corporate sector.
To create our list of some of the best forex brokers in Pakistan, we sorted the brokers according to the following criteria:
- highly regulated global forex brokers
- local deposit and withdrawal methods
- costs and commissions of the broker
- general quality of services offered
What are the best forex brokers in Pakistan?
Below is our curated list of the best forex brokers for traders living in Pakistan, with details and information about the country laws, the features, and the characteristics.
Is forex trading legal in Pakistan?
As a forex trader, you will be glad to note that forex trading in Pakistan is legal. Trading in Pakistan is regulated by the SECP (Securities and Exchange Commission of Pakistan).
The only major rule or restriction that forex traders in Pakistan must abide by when trading with a broker is that the currencies they trade should be well regulated within their own countries by some kind of national authority. This means that major currencies such as EUR, USD, CNY, AUD, and others are allowed to be traded without issue.
Commodities trading is also permitted within Pakistan from certain SECP compliant brokers. Cryptocurrency trading however is not legal and therefore not catered for within Pakistan.
How to trade forex in Pakistan
The SECP of Pakistan allows for international forex brokers to offer services in the country. This means that if you are a Pakistan-based forex trader, you can open an account with one of these top forex brokers if they are available in Pakistan and from there you simply have to follow the broker’s own regulation to start trading forex.
The steps here are simple and mean that you just need the relevant documents to complete ID and address verification before funding your account.
What should Pakistani traders look for in a forex broker?
With Pakistan forex trading, due to the fact that the market is open to all international brokers offering service in the country, you may find a variety of offers and broker conditions on your search.
Here are a few tips that can help you stay safe and choose the best forex broker in Pakistan.
1. Look for trusted brokers in order to avoid fraudulent firms:
Since the SECP does not regulate the forex market in Pakistan, this means you will be choosing an international broker. The most important thing here is recognized regulation.
This means you should try to select a broker regulated by one of the top-tier bodies such as CySEC, the FCA in the UK or ASIC. These are a few of the top names to look out for when it comes to trusted forex regulatory bodies as well as brokers that are ESMA compliant.
2. Choose the best broker for Halal trading
If you are an Islamic trader, you also need to ensure you choose a broker that offers good conditions for Halal Trading. Swap-free accounts do not charge any overnight fees and so are generally considered to be OK for Islamic trading.
If you want to know more about islamic accounts you can check out this guide to the best Islamic forex brokers.
3. Choose a broker with low fees
Due to the fact that none of the brokers offer PKR as a base currency, you will inevitably have to pay conversion charges on deposits and withdrawals. In that case then, you will need a broker that keeps these fees as low as possible to minimize your own costs.
How to verify if a forex broker is regulated in Pakistan
Since the SECP does not directly regulate the forex market in Pakistan, you will be dealing with some of the top international forex brokers regulated around the world.
These regulations and your specific broker status can be checked through the following links depending on who the regulator is.
When checking the ESMA regulatory status, you will need to know the European country of registration for your broker, but nevertheless, all European registered brokers with CySEC are typically compliant with ESMA regulations.
Is forex trading taxable in Pakistan?
Forex trading is taxable in Pakistan.
The Capital Gains Tax that you will have to pay depends on how long the position has been open and the following rates apply:
- 0-1 year: 10%
- 2 years: 7.5%
- 3 years or more: 5%
In comparison with some other countries, this Capital gains tax of Pakistan is in fact quite reasonable.
[Disclaimer: we are not accountants, we have done internet research. If you don’t know how to handle this matter, we strongly suggest you contacting Pakistani authorities before proceeding]
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