CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. Between 74-89% of retail investor accounts lose money when trading CFDs. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
Between 54-87% of retail CFD accounts lose money. Based on 69 brokers who display this data. *Availability subject to regulation.
The financial markets in Canada have a relatively long and stable history, with the Toronto Stock Exchange (TSX) having grown to become the largest in Canada. In addition to the TSX, traders in Canada also have access to two alternative stock exchanges. NASDAQ Canada is based in Montreal, Quebec, while the Canadian Securities Exchange (CSE) is run by CNSX Markets Inc. and has its base in Toronto, Ontario.
With respect to derivatives, the Montreal Exchange (MX) is located in Montreal, Quebec and hosts trading on futures and options contracts based on stocks, indices, forex pairs, ETFs, interest rates and energy commodities. Furthermore, ICE Futures Canada is situated in Winnipeg, Manitoba and allows trading in canola (rapeseed) and western barley futures and options on the ICE platform.
Forex traders will be familiar with the Canadian dollar (CAD), nicknamed the Loonie, as Canada’s national currency. The CAD was also ranked as the fifth most popular reserve currency in 2017, amounting to approximately 2% of total global reserves. The Canadian dollar has historically benefited from Canada’s economic soundness, as well as its political and legal stability.
Factors that influence the Canadian markets include the price of key commodities exported by Canada, like oil and gold, since roughly 30 percent of Canada’s GDP comes from exports, mostly to the United States. Oil remains Canada’s largest export and a key strategic global commodity despite widespread efforts to reduce dependence on fossil fuels.
Trade tariffs imposed by the United States have been a recent issue for Canadian markets and the CAD, as has the renegotiation of NAFTA. This especially hit the TSX in 2018 due to the fact that so many listed companies depend on international trade.
The recent legalization of cannabis has also spurred growth in that sector, and a series of hostile takeovers and attempts in the cannabis and oil industries have shaken up the Canadian stock market somewhat by causing unusual volatility in affected share prices.
Financial regulation in Canada for online forex and contract for difference (CFD) brokers falls under the Investment Industry Regulatory Organization of Canada (IIROC). The Financial Institutions Supervisory Committee (FISC) coordinates regulatory activity, sets regulatory policy, and oversees financial institutions.
In the Canadian financial market model, the CSE has a continuous auction market for issues it lists, as well as for issues listed on stock exchanges elsewhere in Canada. The exchange’s high performance and low latency trading system ranks orders by price, broker and time. The CSE regularly adds services for traders that include risk management and routing services aimed at helping them meet their regulatory and client obligations.
When looking for an online broker to trade forex or CFDs with, make sure to choose a well-regulated broker that has a strong reputation with clients, since they should be suitable for entrusting a margin deposit with them.
Online brokers generally offer several trading account for traders, including:
Although Canada was only ranked 22nd for the ease of doing business by the World Bank, the country ranked 12th for getting credit and 11th for protecting minority investors, so this indicates a relatively favourable environment for traders.
Furthermore, according to Invest in Canada, Canada has one of the world’s strongest financial services sectors, with all forms of financial institutions well represented. In addition, foreigners had directly invested a cumulative amount of $121.5 billion in the country’s financial and insurance industries as of 2016.
Given the country’s prudent regulatory environment, this broad and stable financial base suggests decent growth opportunities for investors. The notable progress of the newly-legalised recreational cannabis industry has also provided an unusual opportunity for traders and investors alike.
Since Canada is so dependent on foreign trade, especially with the United States, its economy can be harmed substantially by tariffs, trade wars or the failure of major trade agreements. Such shocks can affect the USD/CAD exchange rate considerably when announced, thereby challenging forex traders looking for more orderly markets.
In a recent development, Reuters reported in April 2018 that Canada’s TMX stock market partially shut down, which halted trading over an hour ahead of time. The internal technical issues involved were fixed, but this worried some operators into considering different trading channels.
Many traders find Canada and its financial markets favourable to operate in due to the country’s relatively stable economy and political structure. When searching for a broker to trade through in Canada, people should check to see that they offer a suitable range of asset classes, a decent trading platform, strong regulation, and adequate financial security for a margin deposit.
Forex.com scored best in our review of the top brokers for canada , which takes into account 120+ factors across eight categories. Here are some areas where Forex.com scored highly in:
Forex.com offers one way to tradeForex . If you wanted to trade USDCAD
The two most important categories in our rating system are the cost of trading and the broker’s trust score. To calculate a broker’s trust score, we take into account a range of factors, including their regulation history, years in business, liquidity provider etc.
Forex.com have a AAA trust score . This is largely down to them being regulated by Financial Conduct Authority, segregating client funds, being segregating client funds, being established for over 19
Want to see how Forex.com stacks up against ThinkMarkets? We’ve compared their spreads, features, and key information below.
|USD/JPY Spread||0.90||0.10||DAX Spread||250.0|
|FTSE 100 Spread||150.0|
|Platform||MT4, Web Trader, NinjaTrader, Tablet & Mobile apps||MT4, Mac, Web Trader, Tablet & Mobile apps|
|Base currency options||USD, GBP, EUR||USD, GBP, EUR, CHF, JPY, SGD, AUD, CAD, NZD, CNH|
|Funding options||Bank transfer, Cheque, DebitCard,||Payoneer, Credit cards, Bank transfer, Neteller, BPAY, UnionPay, FasaPay, DebitCard,|