The one and only regulatory organ monitoring the financial sectors of Saudi Arabia is the Capital Market Authority. The Saudi CMA is a governmental organization that is financially, legally, and administratively independent body. The authority sets and executes financial rules and regulations to protect the investors and participating parties within different capital markets. Regulating the Forex industry is included within the responsibilities of the CMA.
Forex traders in Saudi Arabia have to pay Capital Gains Tax (CGT) in the amount of 20%. The tax is imposed upon disposal of the gain or right after selling the Forex currency pair. CGT applies to the net profit generated through trading currency pairs. The securities that are traded on the Saudi stock exchange are exempt from the Capital Gains Tax.
There is no government-instituted cap on leverage in Saudi Arabia. Neither government nor the Capital Market Authority limits the trading conditions of leveraged Forex assets offered by the brokers. However, the brokers in Saudi Arabia have to comply with Sharia law and abstain from offering anything that goes against Islamic laws on Riba. That is why Islamic trading accounts are so common in Saudi Arabia.
The national currency Saudi Riyal has been fixed against the US dollar since 1986. Any forward prices in the Saudi Riyal reflect the USD peg. Therefore, trading the currency is not attractive for brokers or Forex traders. That is why SAR is not found within the list of available Forex currency pairs with the leading brokerage companies.
Most popular payment options are available to Saudi Forex traders including the Visa/Mastercard debit card payments and online payment solutions like Skrill. The brokers do not charge any withdrawal or deposit fees for Saudi Arabia traders.
During the last few years, the Kingdom of Saudi Arabia has significantly improved the regulatory system with multiple institutions guarding the financial sectors, banking, and insurance. Accordingly, various international Forex brokers began operating in the region. However, the traders from Saudi Arabia do not rely on CMA-approved brokers only and prefer to join the platforms of international, multi-regulated Forex brokers. The most common practice is to choose a broker that is authorized by the Dubai Financial Services Authority, DFSA. This regulatory body monitors the brokers to comply with Shariah laws and audits them regularly. Below is the list of the best Sharia-compliant Forex brokers in Saudi Arabia.
5$
CySEC, FCA, ASIC
30$, 50%+20%
30:1
2009
MT4, MT5, WebTrader
$100
CySEC, CBI, FSA, FFAJ, BVI FSC, FSCA, FSRA
1:400
2006
MT4, MT5, WebTrader, AvaTradeGO
USD 5,000
FINMA, FCA, ASIC, FSA, MAS, AFM
N/A
1:30
1992
SaxoTraderGo, SaxoTraderPro
$5
SVGFSA, FCA, DFSA, FSCA, FSA
From 30% to 100%
1:1000
2010
MT4, MT5
15
CySEC
30%
1:500
2015
MT4, WebTrader
$250
FSCA
1:200
2012
MT4, WebTrader
100$
FCA
N/A
30:1
2008
Custom
$10
Risk Warning: YOUR CAPITAL MIGHT BE AT RISK
N/A
1:1000
2013
Proprietary
10 USD
FCA, CySEC, FSA
N/A
1:Unlimited
2008
MT4, MT5, WebTerminal
$10
N/A
N/A
1:500
2019
MT4, custom
$10
1:500
MT4
250$
FCA, NFA
N/A
200:1
1999
MT4
$25
ASIC, CySEC, FSA, BVI
50%
1:400
2001
WebTrader, MT4, TradingView
100
FCA, CySEC, DIFC, CIMA
N/A
500:1
1977
MT4, MT5
$100 AUD
ASIC
N/A
500:1
2005
WebTrader, MT4, MT5, IRESS
AUD$200
ASIC, SCB, CMA, CySEC, FCA, BaFin and DFSA
N/A
1:400
2010
MT4, MT5, cTrader, TradingView
$50
N/A
N/A
1:500
2015
MT4
1 USD
ASIC, FCA
10 USD
1:500
2005
MT4, MT5, WebTrader
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.
One of the most noteworthy organizations authorized by the Saudi Arabia government is the Capital Market Authority or CMA in short. The organization is strictly following the Capital Market Law and is reporting directly to the council of ministers. It is one of the main regulators of the Saudi Capital Market and presents the sets of standards and regulations on a regular basis that Saudi Arabia brokers have to follow. The listed companies with the Capital Market Authority should necessarily be transparent and offer an appropriate investment environment. The CMA regulations oblige brokers to have separate, segregated accounts for their clients. It means that the company should not be able to access and use the clients’ many at any given moment. The existence of segregated accounts secures the traders from any financial misfortune that the brokerage firm might experience. For example, if the broker goes bankrupt, the traders’ funds are kept safe on the segregated accounts and they will receive every single cent back from the broker.
In the banking, insurance, and financial sectors industries of Saudi Arabia, the main player is the Saudi Arabian Monetary Authority or SAMA in short. The institution is a national central bank at the same time and is part of the numerous organizations that further safeguard the financial market in Saudi Arabia from illegal acts. Together with SAMA and CMA, two other organizations cooperate to ensure the smooth operation of all the financial institutions and protect the rights of investors and traders in financial sectors. The Saudi Organization for Certified Public Accountants (SOCPA) is the main auditor of all the brokerage firms and financial institutions residing in the country.
Islamic trading is not a new concept, however, throughout the past few years, it has significantly grown as a crucial feature of any Forex broker. These accounts usually grant several benefits to Muslim traders. Most importantly, on the Islamic account type, the traders are exempt from any brokerage fee that might be regarded as an interest rate according to religious law. For example, the swap fees, or rollover fees apply to all trading positions that are kept open for more than 24 hours. But, Islamic accounts are free from swap fees and do not have to pay for these rollover charges in any case. These accounts are in full compliance with the religious views of the clients.
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Profits generated through trading Forex are subject to a Capital Gains Tax in the amount of 20% in Saudi Arabia. The Capital Gains Tax is payable by each resident of the Kingdom of Saudi Arabia on his or her capital gain at the end of the tax year. The CGT applies to net income after selling the Forex asset, meaning that only the difference between the selling price and the original purchase price of an asset will be taxed. On the other hand, similar to the policy on Forex tax exemption in UAE, Forex traders who trade on Saudi Arabia exchanges are exempt from paying the Capital Gains Tax.
The General Authority of Zakat and Tax is a governmental body that collects and asses taxes both from legal and natural persons. Avoiding the Capital Gains Tax or hiding any proportion of the income will result in legal charges and a fine.
Saudi Riyal is not available within the list of tradable Forex currency pairs. The reason is that the Saudi Arabian Monetary Authority has pegged the national currency to the US dollar at 3.75. Therefore, all the price fluctuations in the USD pairs would reflect on SAR prices, as well, which makes it a highly unprofitable Forex asset to trade. Accordingly, top FX brokers in Saudi Arabia will not include SAR within their Forex asset portfolios. However, due to the close resemblance of the USD and SAR value volatility and fluctuations, Saudi Arabian Forex traders often trade with USD currency pairs.
The majority of the Islamic accounts offer convenient spreads on the popular USD currency pairs. For instance, the EUR/USD pair can be traded with as low as 0.6 pip, especially considering the fact that Islamic accounts are also exempt from swap fees. Other popular USD currency pairs that Saudi Arabian traders often invest in are:
There is no government-instituted cap on maximum leverage offered by the Forex brokers in the Kingdom of Saudi Arabia. Even though the official regulatory body, the Capital Market Authority passes numerous regulations and rules annually, the organization does not limit the terms and conditions provided by the brokers. On the contrary, the CMA works hard to encourage the Saudi traders to participate in the Forex industry and protects their interests, as well.
However, Saudi traders should keep in mind that the high leverage bears a considerable financial risk, especially in Forex trading. The Forex market is an extremely dynamic market with high volatility and unpredictability. Therefore, one should precisely determine his or her risk tolerance and use the leverage accordingly. We do not recommend going for the leverage of more than 1:1000 for beginner and intermediate traders.
The Saudi Forex traders can access all popular payment systems including Visa/Mastercard debit card payments, bank wire transfers, and online payment solutions such as Skrill. The best Forex broker Saudi Arabia prioritizes Visa/Mastercard debit cards since the usage of credit cards is very low in the country. Also, the Skrill payment system is very frequent and common among Forex traders in the Kingdom of Saudi Arabia. None of the best Forex brokers in SA charge for withdrawals and deposits processed through their supported payment channels. However, some of the payment service providers might request the service fees on their own.
Payment fees for withdrawals and deposits depend on time. Instant deposits and instant withdrawals are the most expensive types of payment transactions and they might take commissions of up to 1-2% of the payment amount with an additional fixed fee. There are some free payment services available if the client is down to waiting for 2-7 working days.
Finding a decent Forex broker in Saudi Arabia is not always easy. Especially, when there is no local authority regulating the brokerage companies and there are hundreds and thousands of brokerage firms operating on an international scale and marketing their services through possibly every channel. That is why we recommend several techniques to identify the best brokers in Saudi Arabia. First and foremost you need to conduct research. You should look for the list where all the reputable brokerage companies will be displayed. You can have a look at the basic features of the listed brokers and pick a few of them to compare later.
Ideally, the most suitable Forex broker for you should offer the conditions which reflect well on your trading goals, trading budget, risk tolerance, and trading strategy. If you do not have your trading strategy figured out, yet then you should definitely have a look at various Forex trading strategies, as not all Forex brokers will be welcoming any strategy that you choose. Whenever you are set with your own personal criteria for the appropriate brokerage firm make a checklist and see how many points can the broker actually satisfy. Here are the few features that you should be looking for in any Forex broker:
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