With a population of over 37 million people, Canada has a thriving Forex scene.
Canadian Brokers Comparison
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Regulators | ASIC, CMA, CySEC, FSCA | ASIC | IIROC | BVI, FSCA, LFSA | ASIC, FSA | N/A |
Year Established | 2005 | 2019 | 1971 | 2006 | 2015 | 2007 |
Execution Type(s) | ECN/STP | Market Maker | ECN/STP, No Dealing Desk | ECN/STP | ECN/STP, Market Maker | ECN/STP, Market Maker |
Minimum Deposit | ||||||
Average Trading Cost EUR/USD | 1.2 pips | 1.2 pips ($12.00) | N/A | $4.00 | 1.0 pips ($10.00) | 1.2 pips |
Average Trading Cost GBP/USD | 1.4 pips | 1.6 pips (16.00) | N/A | $24.00 | 1.7 pips ($13.00) | 1.3 pips |
Average Trading Cost Gold | $0.16 | $0.84 | N/A | $45.00 | $0.30 | $0.16 |
Trading Platform(s) | MetaTrader 4, MetaTrader 5, cTrader, Proprietary platform, Web-based | MetaTrader 5 | MetaTrader 4, MetaTrader 5, Proprietary platform, Web-based | MetaTrader 4, MetaTrader 5, NetTradeX | MetaTrader 4, MetaTrader 5, Proprietary platform | MetaTrader 4, MetaTrader 5, Web-based, ATpro platforms |
Islamic Account | ||||||
Negative Balance Protection | N/A | N/A | ||||
| Visit Website | Visit Website | Visit Website | Visit Website | Visit Website | Visit Website |
FP Markets
In Summary ECN trading with leverage up to 1:500FPMarkets is a well-established forex and CFD broker operating out of Sydney, Australia’s financial capital. However, as a Canadian trader, don’t let the fact that these guys are located in Australia put you off. As it so happens, Australia’s financial regular, ASIC, is more lenient when it comes to leverage than regulators in the USA, EU or the UK are. This allows FPMarkets to offer their clients leverage as high as 500:1. FPMarkets is considered to be one of the best forex and CFD brokers in the world today, and they tend to stand out from the crowd thanks to their very diverse range of tradeable assets.
Pros & Cons
- Choice of trading platforms and auxiliary trading tools
- Very competitive cost structure and excellent asset selection
- Low minimum deposit requirement and leverage of up to 1:500
- Well-regulated and trustworthy
- Availability of Iress geographically restricted
Focus Markets
In Summary The best Forex broker for cryptocurrency tradersFocus Markets is the best Forex broker in Canada for micro-lot trading with a minimum trade size of 0.1 lots or 1,000 currency units. Traders get the MT5 trading platform, which supports algorithmic trading, and the balanced asset selection exceeds 500 trading instruments. Focus Markets onboards Canadian traders via its unregulated but duly registered St. Vincent and Grenadines entity.
The Raw account offers raw spread trading from 0.0 pips for a commission of $3.50 per side or $7.00 per 1.0 standard round lot. Customer support is available 24/5, and traders can deposit via bank wires, credit/debit cards, and Skrill.
Pros & Cons
- 24/5 customer support
- Competitive swap rates on leveraged overnight positions
- A well-mixed asset selection
- MT5 trading platform
- Limited payment processors
Friedberg Direct
In Summary Competitive spreads + deposit insurance up to 1 million CADFriedberg Direct was founded in 1971 and has since become one of the largest independent brokers in Canada. Friedberg Direct is governed by the Investment Industry Regulatory Organization of Canada or IIROC. That also means it will be covered by the Canadian Investor Protection Fund (CIPF) which covers a depositor up to $1,000,000 if a member firm fails. Friedberg Direct is powered by AvaTrade Technology.
Pros & Cons
- Very Competitive Spreads
- Deposit Protection
- No Bonuses
- No Education Offering
IFC Markets
In Summary 1:400 maximum Forex leverage with floating spreads from 0.4 pipsIFC Markets offers its NetTradeX platform alongside MT4/MT5 and shines with its unique Portfolio Quoting Method, allowing traders to create synthetic assets and generate trading opportunities. PAMM accounts cater to traditional account management services, and IFC Markets offers competitive, commission-free Forex spreads from 0.4 pips or $4.00 per 1.0 standard round lot. Therefore, I rank IFC Markets among the best Forex brokers in Canada.
High-frequency traders and scalpers benefit from fast order execution and VIP trading conditions for deposits above $50,000, which include flexible trading conditions. The IFCM Trading Academy provides beginners with a well-structured educational program.
Pros & Cons
- Excellent regulatory track record and secure trading environment
- Outstanding asset selection and patented PQM asset generation technology
- Extremely competitive commission-free trading cost structure
- Valuable research and educational section, low minimum deposit, and high leverage
- No direct support for social trading
PU Prime
In Summary Ultra-low trading fees for $10,000+ portfolios.I rank PU Prime among the best Forex brokers in Canada as it offers a choice of trading platforms, fully supports algorithmic trading, and has dedicated solutions for copy and social traders. The well-balanced asset selection covers seven sectors, and traders get five account types with a minimum deposit requirement of $50. PU Prime offers a choice of commission-free and commission-based accounts, and it also features a cent account with a $20 deposit requirement.
PU Prime publishes quality daily market commentary, which includes actionable trading setups. PU Prime also has a proprietary mobile app and 24/7 customer support.
Pros & Cons
- Well-balanced asset selection and competitive commission-based fees
- Full support for algorithmic, copy, and social trading
- Upgraded MT4 trading platform, MT5, and proprietary mobile app
- Partnered with Financial Commission making clients eligible for up to €20,000 in compensation.
- $10,000 minimum deposit requirement for ultra-low trading fees
Axi
In Summary Spreads starting from 0.0 pips + leverage up to 1:500Axi ranks among the leading Forex/CFD brokers in Canada. It has an annual trading turnover exceeding $2.4 trillion, and the excellent trading infrastructure includes 20+ liquidity providers. Free VPS hosting for qualifying traders delivers low-latency 24/5 algorithmic Forex trading. Traders get MT4, which Axi upgrades with Autochartist plus the MT4 NextGen suite. It adds advanced management tools, sentiment trading, and enhanced ordering.
Beginner traders can benefit from the Axi Academy and webinars, while copy traders can rely on the embedded MT4 service. Axi maintains competitive trading fees with raw spreads for a commission of $7.00 per 1.0 standard round lot.
Pros & Cons
- No minimum deposit and high leverage for most international traders
- Autochartist plugin for MT4 and API trading for algorithmic traders
- AI-powered third-party trading analytics platform PsyQuation
- Excellent trading costs and social trading plus educational resources in 24 languages
- Limited asset selection
Forex Trading in Canada - Regulations and More
The Canadian Investment Regulatory Organization (CIRO) regulates Forex trading in Canada. Established on January 1st, 2023, through the combination of the Industry Regulatory Organization of Canada (IIROC) and the Mutual Fund Dealers Association of Canada (MFDA). The CIRO is a non-profit, national self-regulatory organization (SRO), similar to the IIROC and MFDA.
Canada is unique, as it remains divided into multiple jurisdictions along the lines of its provinces and territories. Each province has a regulatory body that can provide additional rules over and above IIROC requirements. Canada is one of the few developed nations that allow its citizens to invest their money with overseas Forex brokers that are unregulated in Canada.
Understanding IIROC Regulation
IIROC has a comprehensive rule book for Canadian Forex brokers that govern how clients’ deposits are held, how much leverage is allowed and what information must be disclosed. When a Canadian Forex Broker is regulated by IIROC, it also means they will be protected by the Canadian Investor Protection Fund (CIPF) which covers depositors up to $1,000,000 each if a Forex broker fails. The best Forex brokers in Canada will have this level of coverage.
IIROC will set out a Canadian Forex brokers’ minimum capital requirement and screen every single employee for suitability of professional qualifications and good character. The maximum leverage which may be offered to any retail client by an IIROC regulated Canadian Forex broker is 50 to 1, which is a relatively generous limit for a Western OECD nation: in comparison, in the European Union, the maximum leverage is 30 to 1. Unless you are trading a very small account, 50 to 1 is enough leverage to enable profitable trading but still control risk so you do not lose your entire online Forex trading account overnight.
Verifying IIROC Regulation
It is easy to verify which Forex brokers in Canada are covered by IIROC. You can do that by scrolling down to the bottom of the homepage of the Forex broker to see their regulatory information. Some Forex brokers in Canada also put this information in the “About Us” section of their websites. You can visit IIROC’s website directly where it will list which Forex brokers in Canada they cover – this is the best way to verify that the information provided by the Forex broker in Canada is correct.
Is Forex Trading Legal in Canada?
Forex trading is legal in Canada. Forex brokers and service members must have a membership with the Canadian Investment Regulatory Organization (CIRO) and a regulatory license from any of the ten provincial regulators, which creates varying regulatory environments within Canada. Since each of the ten provinces regulates Forex traders residing within its jurisdiction, many international Forex brokers choose not to operate in Canada. The compliance fees to ensure a broker complies with the ten districts and the potential number of clients make Canada unattractive for offshore brokers.
The CIRO and provincial regulators classify Forex as a security or derivative. The Canadian Investor Protection Fund (CIPF) offers protection of up to C$1,000,000 per taxable account, plus an additional C$1M per RRSP/RRIF account and RESP account for total coverage of C$3M.
How to Choose the Best Forex Broker in Canada
Each Forex trader has requirements and preferences, determining the best Forex broker in Canada for their trading strategy. Still, all competitive and trustworthy Forex brokers in Canada will offer a similar core trading environment.
Traders should ensure their Forex broker in Canada offers the following:
- Transaction Costs - Trading fees directly impact each strategy and profitability. A competitive cost structure features commission-based pricing environments with raw spreads between 0.0 and 0.01 pips on major currency pairs for a commission below $7.00 per round lot, plus a volume-based rebate program. Alternatively, commission-free alternatives should have minimum spreads of 0.7 pips or less. Traders who keep leveraged overnight positions should ensure reasonable swap rates, including positive ones if applicable, exist.
- Regulation - Canadian Forex traders must trade with a broker regulated by the Investment Industry Regulatory Organization of Canada (IIROC). Legit offshore Forex brokers do not accept Canadian-resident Forex traders, and those who do are scam brokers to avoid. IIROC-regulated brokers participate in the Canadian Investor Protection Fund (CIPF), which covers depositors up to $1,000,000 should a Forex broker fail.
- Trust - Traders should trade with an IIROC-regulated broker presenting a spotless track record spanning 10+ years to ensure a time-tested trustworthy trading environment.
- Account Types - Many Canadian Forex brokers have simplified their account types with the most notable difference between competitively priced commission-based account types and more expensive commission-free alternatives, with few exceptions.
- Security - Secure Forex brokers encrypt communications between traders and themselves, including the back office for deposits and withdrawals and the trading platform, where traders manage portfolios. 2FA will increase the security features, especially for mobile traders, and the best Forex brokers in Canada have cyber security teams monitoring traffic 24/7.
- Instruments - A well-balanced asset selection offers traders trading and diversification opportunities, but the requirements for each trader differ. Therefore, I recommend checking the broker’s asset selection to ensure the required trading instruments are available.
- Customer Support - Most brokers offer 24/5 customer support, but traders should check with their broker about office operating hours, contact methods, and response times. Phone support is an often overlooked support method, but the best option should an emergency arise.
- Fees - Besides trading fees noted above, quality brokers will have no additional or hidden costs. Traders should avoid brokers with non-trading fees, like deposit and withdrawal fees. Other fees to avoid are platform and data fees, administrative fees, and inactivity fees applicable after three months of dormancy.
- Deposit & Withdraws - Canadian Forex traders should ensure their broker has no internal transaction fees and low minimum requirements with a choice of e-wallets and preferably cryptocurrency deposits and withdrawals.
- Demo - Beginners and seasoned traders require demo accounts without expiration but with customization options to reflect their planned live portfolios. Beginners can test the trading environment and incorporate educational lessons, seasoned traders will use it to test and tweak strategies, algorithmic traders will bug-fix and test solutions, and copy traders can evaluate signal providers.
Differences in Trading Rules for Canadian & American Brokers & Trading Platforms
Different rules apply to Forex brokers in Canada compared to Forex brokers in the US. For example, there are different leverage and margin rules between Forex brokers in Canada versus the US. Also, many Forex brokers in the US will not accept accounts from Canadian residents. If you are looking for a broker that offers the best currency trading platform in Canada for your trading needs, all the trading platforms offered globally are available from Forex brokers in Canada. For example, MetaTrader 4 and MetaTrader 5 are a standard for many Forex Brokers in Canada.
How to Choose a Forex Broker as a Beginner Trader in Canada?
While traders have different needs, certain core requirements will always ensure a secure and competitive trading environment. My comprehensive analysis of Forex trading in Canada focused on the criteria below, as they are necessary for all Forex traders.
The best Forex brokers in Canada will offer the following:
- Regulation: A clean regulatory record of 10+ years with trader-friendly regulators. While Canadian traders can consider CIRO-regulated Forex brokers, I recommend Forex brokers regulated in New Zealand, the Seychelles, Mauritius, Belize, South Africa, and Dubai, as they balance trader protection and competitiveness. They often include an investor compensation fund, independent audits via the Hong Kong-based Financial Commission, and third-party insurance protection.
- Trading Fees: Trading fees are the most defining aspect of the competitiveness of a Forex broker. Therefore, major currency pairs should not exceed costs of $8.00 per 1.0 standard round lot or 0.8 pips. Volume-based rebates will decrease final trading fees.
- Trading Platforms: I recommend MT4/MT5, as they support algorithmic and copy trading via third-party providers, including ZuluTrade and Myfxbook Autotrade. MT4/MT5 also connects to third-party trading tools like Capitalise AI, Trading Central, and Autochartist. cTrader is another alternative for Canadian Forex traders, next to proprietary trading platforms.
- Asset Selection: An asset selection of 300+ trading instruments ensures proper diversification and cross-asset trading opportunities.
- Deposits and Withdrawals: I advise low minimum requirements, with a choice of e-wallets and preferably cryptocurrency deposits and withdrawals.
How Do I Start Trading Forex in Canada?
Forex traders in Canada should start with in-depth education, which provides the foundation for successful trading. Understanding the impact of trading psychology on market decision-making and deploying strategies to overcome this hurdle is one of the most notable challenges faced by those starting their Forex journey. For many traders, it takes a long time to accomplish.
Beginners can use demo accounts to test strategies and evaluate signal providers and algorithmic trading solutions. However, they must understand the limitations as this cannot replicate the real-world psychological impact of live trading.
Here are tips once Forex traders in Canada feel comfortable approaching live trading:
- Respect Forex trading as a high-skilled profession.
- Have realistic profit expectations concerning your account size.
- Beginner traders should start exploring a trading strategy that has stood the test of time, like the MACD Crossover Strategy or Fibonacci Retracement Strategy, before developing their customized trading strategy
- Understand leverage and use proper risk management.
- Trade from a quiet place.
- Avoid emotional decision-making.
- Explore the importance of algorithmic trading.
How Do You Trade the Canadian Dollar?
The Canadian Dollar is a commodity currency, as Canada relies heavily on the oil sector and other hard commodities and precious metals. Some Canadian Sollar strategies exploit the relationship between global net oil exporters, like Canada, and oil importers, like Japan. They therefore trade the CAD/JPY pair, but Forex traders should keep an open mind and explore all possibilities since the US Dollar is the default oil quote currency.
Technical analysis forms the basis for most Forex traders, and the most profitable ones rely on algorithmic trading. MT4 is the leading algorithmic trading platform, and it is available in Canada.
Day Trading in Canada
Day trading in Canada is legal, where, unlike its southern neighbor, there is no pattern day trader (PTD) rule or a minimum portfolio of $25,000 to start day trading. Still, Canadian brokers will monitor your account and may implement minimum deposit requirements to offer leveraged day trading.
Here are some things to consider before day trading in Canada:
- The Superficial loss rule, also known as the 30-day rule, applies, meaning if a trader sells a stock at a loss and rebuys it or a similar one within 30 days, they cannot claim a capital loss, which has tax implications
- Canada usually treats income from day trading as business revenue rather than capital gains, which also impacts your tax bracket, already among the highest globally
- Know your broker’s policy concerning margin, settlement times, and account type limits, including TFSAs and RRSPs
- Ensure your broker offers ultra-fast order execution, deep liquidity, low fees, volume-based rebates, Level II data, and algorithmic trading
- Start with a smaller portfolio, ideally above C$5,000 and below C$10,000
- Understand the impact of leverage on risk management
- Know how lot sizes impact risk management
- Approach day trading in Canada as a high-skilled profession
Low Spread Forex Trading in Canada
Low-spread Forex trading in Canada is something all Canadian Forex traders should consider. I rank trading fees as the most defining aspect of brokers, as they directly impact profitability, determine the trading environment’s competitiveness, and reveal which strategies a broker actively supports and passively discourages.
Here are my rules for low-spread Forex trading in Canada:
- A raw spread account with spreads from 0.0 to 0.1 pips for a commission not exceeding $7.0 per 1.0 standard round lot
- A commission-free account with spreads on Forex majors not exceeding 0.7 pips
- A volume-based rebate program
Here is an overview of trading fees for low-spread Forex trading in Canada:
- Spreads (competitive spreads start from 0.0 to 0.1 pips)
- Commissions (charged per order if applicable, but should not exceed $7.00 per 1.0 standard round lot)
- Swap rates (charged on leveraged overnight positions)
- Currency conversion fees (which most brokers fail to disclose)
Understand the three basics of low-spread Forex trading in Canada:
- Trading fees depend on the asset, apply to each transaction, and are the most frequent fees traders pay.
- Swap rates are the most ignored trading costs and could become the most significant fee per trade, depending on the strategy. They apply to leveraged overnight positions, which triple on Wednesday to account for trades kept open over the weekend.
- Currency conversion fees apply each time a broker exchanges one currency for another, including trading, and traders are often unaware of this hidden fee.
What Is the Best Forex Trading App in Canada?
The best Forex trading app in Canada depends on the trader’s preferences and requirements. Here are the top contenders:
- MT4 remains a market leader due to its connections to 3rd party trading tools, support for algorithmic trading, 25,000 EA’s, custom indicators and plugins, VPS hosting and more
- MT5 is a close second but has 10,000+ upgrades via EAs, plugins, and custom indicators
- MetaQuotes, the developer of MT4 and MT5, stopped technical support for MT4, but introduced a unified code editor, meaning MT5 is on track to overtake MT4
- cTrader is a reasonable alternative with a much smaller product and service portfolio but a superior user interface, better charting software, and improved algorithmic trading capabilities for developers and traders
MT4 Trading Platforms in Canada
The best Forex brokers in Canada offer the MT4 trading platform, which remains the leading algorithmic Forex trading platform. It also features the most versatile trading infrastructure. MetaQuotes, the developer of MT4, stopped technical support for MT4 to push its successor, the MT5 trading platform.
Adoption has been slow since MT5 launched in 2010. After MetaQuotes unified the code editor, allowing MT4 applications to run on MT5, more Forex brokers offer MT5 alongside MT4. Newer brokers only provide MT5.
Here are five core facts about MT4 to consider:
- MT4 connects to third-party trading tools, including Capitalise AI for code-free algorithmic trading, Trading Central for actionable trading recommendations, and Autochartist for automated chart pattern recognition
- Traders can upgrade MT4 via 25,000+ EAs, plugins, and custom indicators, but quality ones are not free
- MT4 connects to third-party copy trading providers like ZuluTrade, DupliTrade, and Signal Start, ensuring copy traders have a well-diversified pool of signal providers
- MT4 allows advanced algorithmic traders to connect their solutions via API to the trading infrastructure of their Forex brokers
- MT4 supports 24/5 Forex trading via VPS hosting.
How to Avoid Forex and CFD Scams?
While online trading revolutionized the retail financial market and continues to evolve positively in most areas, regrettably, scams have followed.
Here are my tips on avoiding Forex and CFD scams:
- Understand markets and realize what they represent by starting with in-depth education, which helps you spot scams
- Irrelevant to how good their offer sounds, avoid unregulated brokers
- Scam brokers call under the guise of helping beginners trade, which is a red flag, but legit brokers never call traders
- Scammers rely on social media to show fake live portfolio screenshots with linear portfolio growth or high success rates with the occasional loss with outsized returns, usually in groups, forums, channels, and via direct messaging. Therefore, never trust social media
- Never pay for trading bots, which only enrich sellers and fail to deliver long-term results
- Avoid paid-for educational courses, mentors, and trading coaches, offered primarily by failed traders who recover losses by selling useless products and services
- Ignore anything that promises quick profits from small deposits with no knowledge needed
- Consider that professional Forex traders average less than 12% annual profits consistently with few exceptions
- The majority of successful Forex traders do not share their strategies, use copy trading, or offer private lessons
Bottom Line
Forex trading in Canada is legal but presents a fractured and challenging regulatory environment, as each of the ten provinces regulates Forex individually, and all brokers must be IIROC members. Most offshore brokers avoid Canada due to its uneven regulatory approach. The Canadian Forex market has a restrictive regulatory environment but offers the highest investor compensation fund, with maximum coverage of up to C$3,000,000 per individual.
A few well-known and highly trusted Forex brokers cater to Forex traders from Canada, where traders have few restrictions on which strategies that can be deployed, but do lack access to some competitive trading tools available elsewhere.
You might also be interested in reviewing the below top brokers:
