Is forex trading legal in Malaysia? How to choose a reliable forex trading platform

Current Status of Forex Trading in Malaysia: From Ban to Legality

Previously, engaging in forex trading in Malaysia carried legal risks, but now everything has changed. Malaysia has explicitly permitted residents to conduct forex trading through compliant channels, opening new opportunities for investors.

However, the answer to Is forex trading legal in Malaysia is: Yes, but only if you choose platforms that are properly regulated. This is crucial because in a market with many untrustworthy players, not all platforms claiming to offer forex services are reliable.

Comparative Analysis of 5 Popular Forex Trading Platforms

To help traders quickly find suitable platforms, we have conducted a horizontal comparison of several well-regarded forex brokers currently operating in Malaysia:

*Customer service needed for adjustments

How to Identify Legitimate Platforms: Start with Regulation

When choosing a forex platform, investors should prioritize regulatory credentials. Currently, the most reputable forex regulatory agencies worldwide include:

🔹 Australian Securities and Investments Commission (ASIC) — One of the strictest global regulatory standards; platforms with ASIC licenses must hold an AFSL (Australian Financial Services License) and an ACN code.

🔹 UK Financial Conduct Authority (FCA) — A benchmark for European financial regulation.

🔹 US Commodity Futures Trading Commission (CFTC) — Provides legal protection for US traders.

🔹 EU Markets in Financial Instruments Directive (MiFID) — A unified European regulatory standard.

Quick methods to verify license authenticity

Taking Mitrade as an example (ASIC license number: 398528):

1. Visit the ASIC official website (asic.gov.au)
2. Enter the company name or AFSL number in the license search system
3. Confirm the status is “Current” (under regulation)
4. Check “Licence Authorisation Conditions” for specific business scope

Six Key Considerations When Choosing a Platform

1. Trading Cost Components

The actual costs of forex margin trading include three parts:

• Spread: The difference between buy and sell prices, usually 0.5-2 pips
• Commission: Calculated based on trading volume; some platforms (like Mitrade) have eliminated it
• Overnight Fees: Calculated as: number of lots × contract size × opening price × fee rate percentage

For example, trading 1 lot of EUR/USD with 1:200 leverage requires only $580 margin, with potential gains up to $4,000, resulting in a return on investment of 689%.

2. Forex Pairs and Trading Instruments

A quality platform should offer over 100 forex pairs and extend to stocks, indices, commodities, and ETFs, enabling comprehensive asset allocation without opening multiple accounts.

3. Entry Barriers and Leverage Flexibility

• Mitrade: Minimum deposit only $50, leverage range 1-200x
• FOREX.com: Minimum deposit $250, more conservative leverage
• FXTM: Ultra-low leverage accounts up to 1:3000, suitable for aggressive traders

4. Payment Methods Convenience

Different platforms support different deposit and withdrawal options depending on regions. Ensure the platform supports your preferred payment methods (bank transfer, e-wallets, etc.) and understand transfer speeds and fee policies.

5. Customer Service Responsiveness

From account opening, live trading, to withdrawals, customer support may be needed at various stages. Choosing a platform that offers 24-hour multilingual support is more reliable.

6. Trading Tools and Analytical Resources

A professional trading platform should be equipped with:

• Multiple chart types and technical indicators
• Real-time market news and analysis reports
• Economic calendar and data previews
• Risk management tools (stop-loss, take-profit settings)

In-Depth Review of Mainstream Platforms

Mitrade quickly gained market share with its “low spreads + high leverage + zero commissions” combo. As a rising star, its core strengths are: regulated by ASIC, a low threshold of $50, flexible leverage, and a wide range of trading instruments. A Trustpilot score of 4.7 reflects user approval. New users receive a $10 bonus upon registration, plus an additional $90 for trading, totaling a $100 account opening reward.

FOREX.com, as a top US broker, operates under licenses in eight jurisdictions with the strictest regulation. Its $250 minimum deposit and conservative 50x leverage attract risk-averse investors.

IG, established in 1974, is a veteran in the industry. Offers over 100 forex pairs combined with stocks, indices, and commodities, with a proprietary Webtrader platform providing smooth operation. Be aware of hidden costs like real-time data subscription fees and premium stop-loss orders.

FXTM is known for high leverage, supporting up to 1:1000 on major currency pairs. Multiple account types cater to different trading styles, but inactive accounts for 14 days may lead to permanent deletion of demo accounts.

eToro pioneered social trading. Its Openbook feature allows copying other traders’ strategies, friendly for beginners. However, its spreads are relatively high, putting pressure on trading costs.

Quick 3-Step Guide for Beginners

Step 1 - Choose a Platform: Prioritize platforms with Tier-1 regulation, compare trading costs and service quality.

Step 2 - Open a Demo Account: Use free demo funds (usually $50,000–$100,000) to familiarize yourself with platform features and test strategies.

Step 3 - Start Small with Real Trading: After depositing, begin with minimal lot sizes to accumulate real trading experience.

Overall Recommendations

When selecting a forex trading platform in Malaysia, safety and cost-effectiveness are equally important. Overall, Mitrade, IG, and FXTM are widely recognized for their stable regulation, competitive trading costs, and rich market tools.

Investors should choose based on their risk tolerance, trading frequency, and capital size among these proven platforms. Remember, the answer to Is forex trading legal in Malaysia is yes—as long as you choose legitimate brokers.