Forex trading involves buying and selling currencies like the Malaysian ringgit, US dollar, and many more. Trading currencies can be a way to speculate on economic conditions around the world or to diversify your investment portfolio. However, before you get started, it’s essential to review the top forex brokers in Malaysia and pick the right one for you.
Your broker will determine how much you pay for trading, what currency pairs you have access to, and what trading tools you can use to spot opportunities, among other factors.
In this guide, we’ll review the best forex brokers in Malaysia for 2020. We’ll also cover everything you need to know about how to choose the best forex broker for you and provide a step-by-step guide on how you can get started trading forex today.
How to Trade Forex in Malaysia in 3 Quick Steps:
Can’t wait to start get started with forex trading in Malaysia? You can place your first currency trade in just three easy steps:
Step 1: Open a Trading Account
Open a free trading account with our recommended Malaysia forex broker, eToro.
Step 2: Deposit Funds
Once you have completed the registration and verified your account, you can deposit funds.
Step 3: Begin Trading
Choose from the currency pairs on offer, set your trade preferences and confirm your order.
75% of retail investors lose money when trading CFDs with this provider.
Step 1: Compare the Top Forex Brokers in Malaysia
There has been an explosion of online forex brokers operating in Malaysia in recent years. That’s a good thing for traders, but it also means that deciding which broker is right for you can be a bit challenging.
To help you out, we’ve reviewed six of the best forex brokers in Malaysia that you can open an account with today.
1. eToro - Market Leading Social Trading Platform
eToro is one of the most recognized brokers in the forex trading industry. As a social trading platform, it allows you to engage with other users, and it even offers copy trading tools. These allow you to copy the portfolios of any of eToro’s over 12 million traderswith the click of a button.
This broker offers a great range of currency pairs, with major, minor and exotic pairs all available. You can forex trade with leverage of up to 1:30, meaning you can turn a $100 trader into a $3,000 dollar trade.
eToro does not charge any commissions for trading forex pairs. You’ll only be charged for spreads for each trade you make. The spread can vary depending on the currency pair you use, but they’re always competitive on eToro. There is also a withdrawal fee of MYR 20 ($5) and an inactivity fee of MYR 40 ($10).
Unlike other forex brokers, eToro offers only one type of account, which requires a minimum deposit of MYR 800 ($200). It supports numerous payment methods such as credit/debit cards, Neteller and PayPal. There’s also a $100,000 demo account you can use to trial the platform.
eToro has made the forex market accessible to Malaysian traders by providing a user-friendly trading platform and allowing new traders to copy expert traders’ trading activities automatically. It also includes a proprietary trading platform that can be accessed directly using your web browser or through a mobile app for iOS and Android devices.
This broker is regulated by reputable regulatory bodies such as the FCA, CySEC and ASIC. Also, it makes use of the latest security systems and encryption technology to safeguard its servers against intrusion. Its clients’ funds are segregated in separate bank accounts, so you can trade in confidence.
- Forex Pairs: Trade majors, minors and exotics
- Zero Commission: Just pay the spread for forex trading
- Copy Trading: Mirror top traders' portfolios
- FCA, ASIC and CySEC regulated
- High Minimums for CopyPortfolios: $5,000 required
2. Plus500 - Low Fees and Advanced Charting
Plus500 is a leading online broker that also accepts Malaysian forex traders. It is regulated by top-tier agencies like the FCA in the UK, ASIC in Australia, CySEC in Cyprus and MAS in Singapore. Also, to comply with regulatory policies, all client funds are kept in segregated bank accounts.
This broker offers an impressive range of over 60 forex pairs which you can trade with up to 1:30 leverage. Other instruments available on the platform include stocks, commodities and cryptocurrencies, all of which are traded as CFDs.
This broker offers two types of trading accounts. The minimum deposit requirement for the Standard account is MYR 400 ($100) and offers a maximum leverage of 1:30 for forex trades. There is also a Professional account, which you will have to apply for, that comes with leverage of up to 1:300 at no extra cost. On the downside, you must have performed an average of 10 transactions of significant size over the previous four quarters for you to get a Professional account. Also, your portfolio must exceed MYR2,000,000 ($500,000) to qualify.
Plus500 offers a proprietary trading platform that is user-friendly and easy to navigate. It comes with advanced charting tools that will allow you to add your indicators, select different chart views and trade directly from charts. There is also a mobile trading app that is compatible with Android and iOS devices. The platform also includes price alerts, which you can use to stay on top of forex movements on the go.
The only downside to Plus500 is that it offers relatively limited trader education materials. There are only a few guides and videos, while other brokers offer significantly more to help beginner forex traders get started.
- Risk Management: Stop losses, take profit levels, and more
- Advanced Charts: Numerous technical indicators
- Price Alerts: Never miss a trading opportunity
- No Trader Education: Limited educational guides
3. Capital.com - Impressive Proprietary Trading Platform
Capital.com is a popular forex trading site that was established in 2016 and operates in over 50 countries, including Malaysia. It allows you to trade a wide range of forex pairs with up to 1:30 leverage and uses AI trading technology to help with decision making.
It is regulated by respected agencies such as the FCA and CySEC. In addition, all clients’ funds are fully segregated from the company’s funds and kept in well-established banks. Also, it is audited by Deloitte and all transactions abide by PCI data security standards.
Capital.com offers three account types: Standard, Plus and Premium. The Standard account requires a minimum deposit of MYR 400 ($100). On the other hand, the minimum deposit for the Plus account is MYR 12,000 ($3000) while the Premium account requires a minimum deposit of MYR44,000 ($10,000). All the accounts offer 1:30 leverage and negative account protection.
This broker also provides a user-friendly proprietary trading platform that comes with an extensive charting package, technical indicators and drawing instruments. There is also a mobile trading app that can be downloaded directly from the Apple App Store and Google Play Store.
- Minor and Exotic Forex: Wide range of currency pairs
- Trade Smarter: Utilizes AI technology
- Mobile Trading: Impressive app
- No Automation: Lacks support for automated trading solutions
4. AvaTrade - Offers Competitive Spreads
Originally known as AvaFX, AvaTrade is a well-established online forex broker with a long track record. It offers various platforms for algorithmic and social trading, including MetaTrader 4 and 5, both of which are ideal for forex and offer a range of advanced trading tools.
This broker offers Malaysian forex traders access to a wide range of currency pairs, including exotic currencies. On AvaTrade, you don’t have to worry about paying commissions applied. You’ll only be charged for spreads. For example, the EUR/USD currency pair is charged 0.9 pips and offers leverage of 1:400.
The downside is that the broker charges an inactivity fee of MYR 200 ($50) per quarter after 3 months of dormancy. In addition, an administration fee of MYR 400 ($100) will be deducted from your account after 12 consecutive months of inactivity.
The process of opening an AvaTrade account is relatively easy with a minimum initial deposit of MYR 400 ($100). Its web and desktop platforms offer a lot of features and customization. In addition, you can download native applications for Mac, Windows, Android and iOS. AvaTradeGO is the mobile version that provides simple and quick summary views and trades.
AvaTrade has an education center and extensive resources for novice traders. Some of the main sections of the education center include its trading for beginners course, educational videos and a forex eBook. There is also the public economic calendar that offers useful insights about the forex market.
- Competitive Spreads: Starting from 0.9 pips
- Trader Education: Extensive educational resources
5. FBS - Best for Professional Malaysian Traders
FBS is a popular online forex broker that offers its services around the world. Since its establishment in 2009, it has significantly grown in size, capacity and technology. FBS utilizes a hybrid model of Straight Through Processing (STP) and an Electronic Communications Network (ECN).
It is licensed and regulated by both CySEC and IFSC. Also, as part of regulatory requirements, its traders’ funds are kept in separate accounts and FBS does not use them in its operations. In addition, FBS has encrypted its website with Secured Socket Layer (SSL).
This broker derives its revenue primarily from spreads and swap rates for positions held overnight. Spreads are highly competitive and start at 1 pip. They may increase depending on the liquidity of the currency pair. Another plus to trading forex with FBS is that this broker does not charge for deposits and withdrawals.
FBS offers six account types to meet the needs of a wide range of traders. There is the Cent account that requires an opening balance of MYR 4 ($1) with floating spreads starting from 1pip and a leverage of up to 1:1000. The Micro account requires an opening balance of MYR 20 ($5) with spreads starting from 3 pips and a leverage of up to 1:3000.
The initial minimum deposit on the Standard account is MYR 400 ($100) and it offers a leverage of up to 1:3000. The Zero Spread account requires an initial deposit of MYR 2000 ($500) with 1:3000 leverage and MYR 80 ($20) commissions per lot. The ECN account requires an opening balance of MYR 4000 ($1000) with the floating spread starting from 1 pip and commissions of MYR 24 ($6).
- Highly Regulated: Licensed by CySEC and IFSC
- Minimal Fees: No deposit or withdrawal charges
- Expensive Trades: High spreads
6. IG - Over 80 Forex Pairs
IG is a premier forex broker that offers an extensive range of currency pairs, excellent trading and research tools, competitive rates as well as extensive educational resources. It was founded all the way back in 1974 and is regulated by ASIC, JFSA, MAS, FINMA, FCA and CFTC, so it’s one of the safest platforms around.
With over 80 currency pairs, IG offers plenty of choice to forex traders. As well as major and minor currency pairs, you can trade exotic and emerging currency pairs. IG also offers a wide range of other instruments as CFDs, including stocks, cryptocurrencies and indices.
IG includes a proprietary WebTrader platform, which is one of the most intuitive and well-designed trading platforms in the industry. It is highly customizable with an extensive charting package. There is also a streaming market coverage feature dubbed as IG Live that comes with alerts, analytics and signals. If you want to automate your forex trades, you can also install MetaTrader 4 and link it to your IG account.
IG is fully transparent about the fees it charges. The EUR/USD currency pair is charged at a spread of 0.75 pips plus an additional 1.2 pips mark-up. Other charges include a MYR 36 ($12) inactivity fee, a MYR 200 ($50) account documentation fee and a 0.50% conversion fee. ProRealTime charts also cost MYR 120 ($30) per month.
- Advanced Platform: Extensive charting package
- Automated Trading: Access to MetaTrader 4 software
- Trustworthy: Regulated by reputable bodies
- High Fees: Charges traders for live data and charts
Step 2: Learn About Forex Brokers in Malaysia
Before you start trading forex, it’s important to understand what role Malaysia forex brokers play in the currency market.
What is a Forex Broker?
Also known as a currency trading broker, a forex broker is a firm that gives access to the foreign exchange market for purposes of speculation.
A forex broker acts as an intermediary between you and the broader forex market. When you place a forex trade, your broker will buy currency on your behalf or create a contract for CFD trading of forex.
Nowadays, the process of creating a forex trading account is straightforward and can be done online. You simply need to register and verify an account, deposit funds and then start trading. Most brokers offer leverage, so that you can borrow capital to make larger trades.
How do Forex Brokers Work in Malaysia?
Forex brokers in Malaysia are required to be registered and licensed by the Securities Commission of Malaysia (SCM) to start operating. Other regulators include the Labuan Financial Service Authority (LFSA), Bank Negara Malaysia (BNM) and the Sharia Advisory Council.
Recently, these regulators introduced new guidelines to further regulate forex trading. So, it is expected that more forex brokers will emerge in Malaysia in the coming years.
What are the Regulations for Forex Brokers in Malaysia?
Initially, the Malaysian government had banned forex trading and termed it as an illegal activity. Anyone found engaging in forex trading was charged hefty fines and even incarcerated.
Fortunately, over the past few years, the government has eased its hard stance. Now, forex trading in Malaysia is legal provided that you are dealing with a registered and licensed broker. Investing abroad is legal in Malaysia and using an offshore broker is considered as having a foreign investment.
How to Choose a Forex Broker in Malaysia?
To be a successful forex trader in Malaysia, you have to choose a broker that suits your preferences and needs. Due to the ever-growing nature of forex trading in Malaysia, there are many forex brokers available, making it difficult to choose the best one.
We recommend keeping the following factors in mind to help you find the right broker for you:
- Regulation and licensing – It’s vital you choose a broker that will keep your personal details and your funds secure. Go for top forex brokers that hold licenses from respected governing bodies, such as the UK’s FCA, Australia’s ASIC and Cyprus’ CySEC.
- Currency pairs – Check to make sure your preferred currency pairs are available before signing up. The available trading pairs can vary a lot at different brokers, particularly when it comes to minor and exotic pairs.
- Fees and charges – All of the Malaysian forex brokers we recommended are fully commission-free, which is a huge advantage for high volume traders. However, keep in mind that you’ll still pay a spread on every forex trade, and high spreads can add up over time. You’ll also want to look into what fees your broker charges outside of trading, such as deposit or withdrawal fees and inactivity fees.
- Trading tools – It’s important to have the right trading tools for you. Whether you’re a beginner and want to use copy trading tools like those on offer at eToro, or if you want to use the advanced charting and analysis tools that come with MT5 brokers, you should check what;s on offer before signing up.
- Educational resources – As a new forex trader, one of the most important factors to look out for when choosing a forex broker is the variety and depth of educational resources it can provide you. Most reputable online brokers offer educational materials such as videos, articles, e-courses, seminars and webinars at no extra cost.
- Banking – You’ll want to make sure your preferred payment method is accepted. For example, some brokers accept PayPal, while others accept Neteller and Skrill. We also recommend ensuring the minimum deposit is in your budget range.
- Customer service – It is important to choose a broker that offers quality and reliable customer services. This is to make sure that you can get immediate assistance in case you encounter issues related to the trading platform’s functionalities or the withdrawal system. Ideally, your chosen forex broker can be contacted via email, phone and social media during a wide range of hours.
- Platform and user experience – The trading platform your broker provides will be critical to your forex trading experience. To start, it should be easy to use even for beginner forex traders. Ideally, you’ll also want the platform to be available as a mobile forex trading app so that you can monitor your currency trades on the go. When it comes to charting and analysis, platforms can vary widely. Some brokers offer basic charting software with a few technical indicators, while others have advanced software with hundreds of indicators. MT4 brokers like AvaTrade and IG also give you access to MetaTrader 4, which includes forex trading signals, algorithmic trading, and automated trading.
Step 3: Open a Forex Trade
To help you get started with forex trading, we’ll walk you through the process with eToro. We like to use eToro for forex trading because it has competitive spreads, includes a social network for following other traders, and offers access to most major and minor forex pairs. eToro also lets you deposit money using popular e-wallets like Neteller and PayPal.
But, if you chose another forex broker in Malaysia, don’t worry. The process for placing a forex trade is largely the same across platforms.
Create an Account and Verify Your Identity
The first process to start forex trading on eToro is to register an account. You will only need to fill the registration form and accept the terms and conditions. Alternatively, you can register through your Facebook or Google account.
Verification is a compulsory part of the eToro registration process. You are required to upload a copy of your passport or government-issued ID to as proof of identity and utility bill and bank statement for proof of address. Note that the utility bill and the bank statement should not be more than 6 months old.
After going through the registration process, you will need to fund your account to start trading. Just click on the ‘Deposit funds’ button and choose your preferred deposit method.
Fortunately, eToro supports a wide range of payment methods such as credit/debit cards, PayPal, Neteller, Skrill, wire transfer and online banking.
Once you have deposited funds in your account, go to the ‘Trade Markets’ section and choose ‘Major Currencies’ to access the currency pairs available. eToro features numerous technical analysis tools and indicators that you can use to decide what forex pair to trade.
To place a forex trade, click ‘Trade’, decide which currency in the pair you want to buy, and specify how much money you want to invest. When you’re ready, click ‘Trade’ to complete your forex trade.
There is also a feature on eToro known as CopyTrader that allows you to follow the trading activities of other traders on the platform. Simply choose the trader you want to copy, allocate the amount you wish to invest and copy their trades automatically and in real-time.
Finding the right forex broker in Malaysia is essential to your success as a forex trader. It’s important to find a broker that offers a good range of currency pairs, low fees, a high-quality trading platform, educational resources, and solid customer support, among other factors. Thankfully, you’ll find exactly that winning combination in the six top Malaysian forex brokers we featured.
If you’re ready to get started trading forex, we recommend choosing our pick for the best forex broker in Malaysia, eToro. With no commission, a great range of currency pairs, and social trading tools, this broker ticks every box. Simply click the link below to get started on eToro today.
eToro: Best Malaysia Forex Broker 2020
- 0% commission forex trading
- Wide range of currency pairs
- Social and copy trading tools
- Highly regulated
To ensure we bring you the most reliable and accurate information possible, our writers use primary sources to support their content. These include studies, government resources and commentary from industry experts.
Bank Negara Malaysia. “Framework for Electronic Trading Platforms.” https://www.bnm.gov.my/index.php?ch=57&pg=150&ac=859&bb=file. Accessed June 8, 2020.
Financial Times. “Malaysian Central Bank Liberalises Foreign Exchange Policy.” https://www.ft.com/content/f4a585e2-a1d5-11e8-85da-eeb7a9ce36e4. Accessed June 8, 2020.
Is it legal to trade forex in Malaysia?
Yes. Forex trading in Malaysia is legal as long as your forex broker is regulated and approved by relevant Malaysian authorities. Using an offshore broker is considered as making a foreign investment.
Will the income I make from forex trading get taxed?
Profits earned from forex trading by Malaysian traders are subject to income tax.
What is the best time to trade forex in Malaysia?
The best time to trade forex in Malaysia is between 9pm and 1am when the market is most liquid and volatile. However, the best time to trade popular Asian currencies such as the Japanese yen is between 8am and 4pm Malaysian time.
Can I make profits through forex trading?
With a good trading strategy and without succumbing to greed, it is possible to turn a profit from forex trading. However, you should understand that the forex market is highly volatile and you can easily incur large losses. Always trade with caution.
Who regulates forex trading in Malaysia?
Forex trading in Malaysia is mainly regulated by the Bank Negara Malaysia and Securities Commission of Malaysia (SCM). Other authorities that are also involved with forex trading include the Malaysian Investment Development Authority, The Finance Accreditation Agency and Sharia Advisory Council.