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Challenges and Advantages of Forex Trading in Singapore

Trading drives businesses with no restrictions on who can get on board. Forex trading is one category that facilitates earning for all forex traders in Singapore. However, the forex market in Singapore has some challenges that one must familiarize themselves with.

A closer look at the challenges and advantages of forex trading in Singapore clarifies how to get started and earn decent profits.

What Is Forex Trading?

Forex trading is the buying and selling of currencies. Forex traders choose specific or multiple trading pairs for their investment portfolios. Trading includes buying one pair and selling it for a higher margin to pocket profit. For instance, Singapore Dollar and the Malaysian Ringgit can be one pair in the investment portfolio of a forex trader in Singapore.

Single forex trading often does not suffice. Forex traders, therefore, look to perform several trades during the hours. Plus, profitability is always subject to risks involved in forex trading.

Advantages Of Forex Trading In Singapore

Forex traders in Singapore are showered with advantages for performing forex trading in Singapore on a platform of their choice. It includes wide accessibility, high leverage, and a 24/5 trading facility.

There are several other advantages of forex trading in Singapore.

Access to a Vast Sector of the Liquid Market

Singapore offers some of the best opportunities for forex traders to access the market. Traders in Singapore report access to one of the world’s largest and most liquid markets, reporting a daily transaction volume of more than $16 trillion.

The larger the market, the easier it is for forex traders in Singapore to buy and sell their preferred trading pairs.

Low Barriers to Entry

Forex trading in Singapore, as compared to everywhere else, is easier to start with no particular level of experience required. Additionally, the forex market does not seek a minimum account balance or size, making it more convenient for traders to get on board.

Barriers restrict entry and thereby affect the movement in the market. The same is not the case with forex trading in Singapore.

High Leverage

A smaller capital does wonders for forex traders in Singapore, courtesy of the high leverage it provides in the market. This allows forex traders to trade larger positions irrespective of how much capital they bring to the table.

Traders in Singapore look at it as a huge benefit. Since the capital invested can be smaller, the returns are at their best with low risk involved.

Round-The-Clock Trading

Forex trading in Singapore is available 24 hours for 5 days. Traders can pick their convenient day and time to perform a trade. It gives them a higher chance of keeping an eye on when they must buy or sell the currency pair.

The forex market remains functional, with rarely any downtime during working hours.

Offers Tight Spreads

The forex market in Singapore is highly competitive because it is easier for traders to get on board. This provides tight spreads to traders in Singapore for reduced trading costs and better profitability.

A tight spread is a positive difference between a currency pair’s bidding price and the asking price.

Regulated Forex Market

The Monetary Authority of Singapore, also known as MAS, regulates forex trading operations in Singapore. The regulations apply to all the platforms and brokers who work in the region.

This gives extra protection to traders against fraudulent and unscrupulous brokers.

Diversification Option

Forex trading brings a wide variety of options for traders looking to diversify their investment portfolios. What works best is the profitability factor that MAS-regulated forex brokers in Singapore offer their clients.

It ultimately brings tons of options for trading purposes along with a chance to earn a decent profit.

These advantages have so far attracted traders of all ages and financial capacities. Profitability can be a risk factor but getting started with a capital of no particular size is a huge deal that works in its favor.

Challenges While Trading In Singapore

There is another side to forex trading in Singapore that must be understood. These are the challenges that traders face in the forex market of Singapore. Their understanding makes it better to circumvent the other side of forex trading.

Here are the challenges that forex traders in Singapore face.

Limited Market Accessibility

The financial sector is pretty well-developed, giving the forex market of Singapore limited accessibility. Limitations arise due to local regulations and restrictions that the regulators impose.

High Cost of Trading

Forex traders in Singapore experience a higher cost of trading in their favorite currency pair. The reason is the increased commission charged by the MAS-regulated forex broker in Singapore and high spreads. Profit, therefore, takes a hit in some cases.

Market Volatility

The currency market carries high volatility not just in Singapore but everywhere worldwide. Several factors are involved in affecting the rise and fall of the price of a trading pair. Predictions and estimates could sometimes go wrong for traders in Singapore and other countries.

Limited Leverage Option

Traders are limited in the forex market based on their leverage options. Singapore, for instance, has capped it at 1:50 for retail traders. It mostly affects the trading capacity in larger positions.

Tough Competition

A larger size of the forex market in Singapore gives ample options to buy and sell. However, it also brings higher competition for retail traders in the region.

MAS Regulation

Retail traders are protected by MAS regulations which are strict. While they are necessary to protect their interests, many currency pairs are left out to limit the forex trading options.

Lack of Education Support

It is easier to begin forex trading in Singapore, and it is equally difficult to understand what should be done. This comes amid the lack of education support in the said sector. Losses become normal when traders cannot under the forex market.

To reiterate, these are merely the challenges forex traders in Singapore come across. These should not be confused with the disadvantages of the forex market in Asian countries.


It takes time to travel through the tunnels of forex trading in Singapore. Challenges come in the way only to be overcome over a longer time. MAS regulations protect the interest of the traders, who can still pocket a decent profit through regular forex trading.

Disclaimer: Traders are required to take due diligence while performing forex trades. While brokers’ operations are regulated by the Monetary Authority of Singapore (MAS), traders should evaluate all the costs and risks involved in forex trading while also considering the volatility factor that may result in losses.


Is It Legal to Trade Forex in Singapore?

Yes, forex trading in Singapore is legal, with a wide range of options for investment portfolio diversification.

Is Forex Trading Regulated in Singapore?

Yes, forex trading is regulated in Singapore by the Monetary Authority of Singapore, also known as MAS. Traders should still follow due diligence and evaluation before investing in the forex market.

How to Check If a Forex Broker Is Mas Regulated?

MAS-regulated forex brokers in Singapore are issued a license which is mandatory for them to display on the platform. Look for the license to check if the authority regulates the forex broker.

Erica Lee

Erica is a finance professional who has over a decade of experience in the finance sector as a management consultant. After years of reporting on forex, stock markets, and finance, she now contributes her strong financial skills with the CoinNewsSpan team. Since 2014, she has been deeply involved in the blockchain and cryptocurrency space. She believes that blockchain technology has tremendous potential to make our lives better.

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