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.
Kuwait is a small emirate strategically located between Saudi Arabia and Iraq at the head of the Arabian Gulf. The country’s financial sector began its modern history after the Iraqi invasion of 1991, which was repelled by a coalition led by the United States and is one of the six members of the Gulf Cooperation Council (GCC).
The primary stock market in Kuwait is called Boursa Kuwait and is located in Kuwait City. It was previously known as the Kuwait Stock Exchange (KSE) prior to 2014. Currently, the stock exchange is in the process of being privatised, before an initial public offering (IPO) available to Kuwaiti citizens.
The Boursa Kuwait breaks down its equity listings into Premier, Main and Auction markets. It operates an Over the Counter (OTC) service intended for local stocks of companies which are not listed on the main market, in addition to corporate bonds and sukuk or Islamic bonds that are structured in compliance with Sharia law.
The primary broad stock index for Boursa Kuwait is the market cap weighted All Share Market Index that tracks the price performance of all stocks listed on the exchange. Other major indices, that are also market cap weighted, are the Premier Market Index and the Main Market Index which respectively track the performance of stocks listed on the Premier and Main markets of the Boursa Kuwait.
The Kuwaiti dinar (KWD), Kuwait’s national currency is managed and issued by the Central Bank of Kuwait (CBK). The dinar is a valuable and relatively stable currency that is further subdivided into 1,000 smaller units known as fils. As of June 2007, the Kuwaiti dinar has been pegged to an undisclosed basket of other currencies, and its peg is managed by the CBK.
In 2016, the Bank for International Settlements (BIS) did not rank the dinar among the 35 most actively traded currencies worldwide. Furthermore, the KWD did not rank among the top currencies held as central bank reserves in 2018, according to a report by the International Monetary Fund (IMF).
The CBK is the primary financial sector regulatory authority in Kuwait, overseeing the regulation of financial firms and the local stock exchange with the aim to protect Kuwaiti investors and the country’s economy from global capital market volatility. As of 2010, the country’s securities markets are further regulated by the Capital Markets Authority of Kuwait with the mandate to ensure local securities law compliance and regulate securities activities in a fair, efficient and transparent way.
The CBK regulates forex brokers under regulatory guidelines issued by the Kuwaiti government, providing licenses to brokers who have the threshold amount of capital, as well as demonstrate good business practices. The CBK also runs a consumer protection unit that accepts and follows up on consumer complaints against financial services firms.
While few reputable online forex or CFD brokers are based in Kuwait, traders living in Kuwait can generally deposit funds to trade online using margin accounts held by non-Kuwaiti brokers who are open to accepting them as clients. However, selecting a broker regulated by the CBK offers certain benefits such as the broker having to maintain a positive local reputation, and could potentially allow for any local resolution of litigation in case of a problem.
Moreover, it is important to note that a foreign broker needs to be competently regulated in a strict jurisdiction. Brokers should keep their clients’ funds separated from their own, helping safeguard the clients’ assets and uphold good governance. Additionally, brokers should also have a decent range of services and a good general reputation with clients.
Another aspect to verify is if the broker provides a demo account. Many online brokers provide demo accounts with virtual money allowing clients to explore their services, practice trading and try out strategies. Additionally, brokers also provide funded accounts where traders make a minimum deposit to enable them to start trading live. Brokers regulated by the CBK should also provide Islamic accounts that are Sharia compliant with no swaps on rollovers.
If having the broker’s website and customer service available in Arabic is an important consideration, then make sure to ask about that service before opening an account. Almost all online brokers will provide a website and customer service in English, although many may also offer website text translated into Arabic.
With respect to the asset classes available to trade online, the choices can differ notably between brokers. While almost all online brokers provide some type of forex trading service, many traders prefer those that allow contract for difference (CFD) trading since CFD brokers usually let a trader take positions in a wider selection of tradable assets. Moreover, in regard to stock trading, Bourse Kuwait provides a transparent and fair market in Kuwaiti stocks and some corporate fixed income securities, including sukuks. Trades executed on the exchange are generally transacted in Kuwaiti dinar.
The Bourse Kuwait recently purchased and plans to use the X-stream trading system backed by The Nasdaq OMX Group. This upgrade is intended to allow the trading of international futures, options, exchange traded funds (ETFs), fixed income securities and sukuks listed on the Bourse Kuwait.
Kuwait has a small population of 4.2 million of which only about one-third are Kuwaiti nationals. The remaining population consists of expatriate residents from over 80 countries. According to export.gov, Kuwait provides additional opportunities for businesses as follows:
From an overall perspective when it comes to paying taxes, Kuwait achieved a rating of 7th among countries surveyed by the World Bank. The next best ranking for Kuwait was related to registering property, where the country achieved a rating of 69th.
As a consistent net exporter that has shown positive balance of trade numbers since 1993, Kuwait’s economy could be severely affected by instability in the Middle East. Another key factor that could seriously affect the economy is a change in the price of oil, since shipments of oil account for 95% of Kuwait’s total exports.
With respect to the World Bank’s ease of doing business rankings, Kuwait was ranked 159th in trading across borders, 134th in obtaining credit and 133rd in starting a business. The business environment in Kuwait was also seen as rather unfavourable for resolving insolvencies, obtaining electricity and enforcing contracts, with Kuwait ranking 115th, 95th and 77th respectively in those areas.
In summary, businesses and traders should expect Kuwait to provide a rather safe place to operate, and Kuwaiti financial institutions are regulated by Kuwait’s central bank, the CBK. Kuwait nevertheless had only one favourable ranking with the World Bank that related to paying taxes, while the country ranked a rather low 97th overall in ease of doing business.
When considering the available options for an online broker to trade forex or CFDs from Kuwait, traders should determine if they offer enough asset classes, have a good reputation, provide a full featured trading platform and are well regulated in their local jurisdiction.
Forex.com scored best in our review of the top brokers for kuwait , 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 EURUSD
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,|