The foreign exchange market, or the forex market as its popular jargon goes, works 24 hours a day, seven days a week. It pairs currency for trading globally. The foreign exchange market is ruled and affected by many factors including political and geographical developments, news, macroeconomic data, socio-economic reasons, festival season, and other developments. This market offers a huge platform for trading, but it is also a challenge to protect the individual traders from irregularities.

Regulations have been created to make sure that the forex brokers and financial intermediaries comply with the rules and regulations put in place to offer protection from and against loss, and against risk exposure for individual brokers.

Forex brokers in the United States
All foreign exchange brokers who operate in the United States must register themselves or their firm with the National Futures Association (NFA). It is a self-regulating body that provides a framework for the marketplace environment to ensure integrity, transparency, abiding by the responsibilities, and protection of participants in the market. The NFA has an online verification system called the Background Affiliation Status Information Center (BASIC). All forex firms can be verified if they have the necessary regulatory compliances in place. There is a list of top US-regulated forex brokers their aim is to provide a list of regulated brokers to the traders. This list has no ranking as such.

FXCM – Forex Capital Markets
The Forex Capital Markets (FXCM) has a low commission of 4 cents per 1000 lot; micro lot trade sizes. A minimum deposit amount of a low $50 is required to open a mini trading account, and the website has a MetaTrader4 platform.

OANDA
OANDA is a brokerage firm which offers competitive spreads with no commission and deep market liquidity. They offer features like forex tools, products, advanced analytical tools, forex news, training videos, and MT4 plug-ins from OANDA and its associated partners.

TradeKing Forex/Zecco
Zecco was taken over by TradeKing. They have on offer multiple forex trading platforms, tight spreads, and an extremely dynamic trader network. Along with these, they have research, analysis tools, and streaming news. The trading applications are compatible across various smartphones.

ATC Brokers
They are regulated brokers and very popular and offer risk management tools, STP execution, no dealing desk, allow scalpings, multiple brackets order like stop-loss, breakeven capability, and custom trailing.

Thinkorswim
This online forex firm is by D Ameritrade, Inc. and is a regulated forex broker; it offers to trade in over a 100 global currency pairs.

Interactive Brokers
These brokers have an international presence. The cost of trading is low, but there is high-level of execution, with global offers, trading technology, risk management tools, and trading tutorials.

TradersChoiceFX
It has worked as a full-service brokerage firm for over 20 years. It offers a rebate program that is providing cash bonus for each forex trade. All trade is executed by their referring partners FXCM, FOREX.com, or CitiFX Pro, online forex firms.

Too little regulations lead to irregularities, and inadequate protection to individual traders, too many regulations kill the competitiveness in the market. A major challenge which the forex regulators face is the leverage provided which is limited to 50:1. While the global brokers provide 1000:1, ensuring security first.

The foreign exchange market is the world’s most traded market and has a turnover of $5.1 trillion per day. The US stock market trades around $226 billion a day; a huge sum, but this is only a fraction of the amount of what is really traded.

Forex is traded across banks, institutions and individual traders across the world. There is no proper market for forex; currencies are traded over the counter in whichever market that is open at that particular time.

Trading forex involves buying one currency selling another at the same time. Traders try and make a profit by buying and selling currencies by speculating in which direction the currencies will go in the future.

Forex is the largest, and most liquid market. Its size and scope create an unknown challenge while trying to regulate the market.

There is no central body governing the currency trading market, but there are several governments and independent bodies, which supervise the forex trading around the world. Some of these include:

• USA – The National Futures Association –NFA and Commodities Futures Trading Commission CFTC
• The UK – Financial Conduct Authority –FCA• Australia – The Australian Securities and Investments Commission – ASIC
• Japan – The Financial Services Agency – FSA
• Canada – The Investment Industry Regulatory Organization of Canada – IIROC

These supervisory bodies regulate the forex by setting standards which all the brokers under each of their jurisdiction must comply with.