A Beginner’s Guide to Forex Trading in Kenya

Are you looking for information on how to start forex trading in Kenya, then you are in luck! In this guide, we will explore how to go about forex trading and list the top five best forex trading sites in Kenya.

The State of Forex Trading in Kenya

Forex trading in Kenya has become popular. It attracts a lot of interest from the public who are looking for ways to make money online. According to recent estimates, there are over 90,000 Kenyan forex traders.

Previously, participation in the forex market was limited to the Government, banks, and financial institutions only. However, for the past decade, retail traders have increased their involvement in the forex market with the rise of online forex trading in Kenya.

Traders use online forex brokers to bet on the price developments of global currencies.

Unfortunately, man Kenyan traders have lost money to scams and fraudulent actors who have infiltrated the forex space. This warranted the Capital Markets Authority to create a framework to regulate online forex trading activities undertaken by retail or institutional traders.

Consequently, online foreign exchange trading regulations became effective in 2017. This opened the way for licensed forex companies to start providing their services in the country.

CMA approved forex brokers that work closely with the regulator to ensure trust, credibility, and transparency. In the event of any fraudulent practices, a trader can take legal recourse against a regulated forex broker in Kenya. The same will not apply to unregulated forex brokers.

How to Start Forex Trading in Kenya

To begin forex trading in Kenya you must find a reputable forex broker. Fortunately, there are a plethora of forex brokers available to local traders with some even integrating local payment options like MPESA to their platforms.

It is advisable to use forex brokers that are licensed and regulated by the CMA. Even though there are some foreign brokers that are not approved by the regulator providing forex trading services to Kenyans, the CMA cautions against using these brokers, as they are not under the CMA’s purview. Therefore, it may be difficult for investors to seek redress in case of any irregularities by these brokers.

That being said, a trader can use a CMA regulated broker or opt for a reputable forex broker authorized by the CMA, and governed by at least two top tier regulators like FCA, CySEC, ASIC, etc.

There are a number of factors that need to be considered before you choose a suitable broker. While regulation is key, other factors to consider include:

• the minimum deposit allowed;
• financial instruments available;
• types of trading accounts;
• fees;
• and payment options.

Depending on your requirements and match to a forex broker that meets your needs. Obviously, finding a broker that is available in Kenya or accepts MPESA for payments can also a key factor.

Once you find a suitable forex broker you can proceed to open a trading account.

A trader can choose to open a live account or a demo account. The procedure for opening an account may vary from broker to broker, there are key steps that are standard across the board.

Once your account has been opened, you will have to complete know-your-customer (KYC) requirements. This may include personal information such as ID, email address, contact details, etc. At times, only upon verification of these details can you be allowed to trade using your account.

The next step will be to deposit funds using a payment method accepted by your broker. Remember, if you are using a live account you must ascertain the minimum deposit balance required by your broker. On the other hand, if you are using a demo account, you will be trading using dummy funds though the features will mirror that of a live account.

Once you have deposited money into your account you will need to download the broker’s trading platform. Some brokers will offer MT4/MT5 trading platforms while others will have their own proprietary platforms that can be downloaded on PCs, smartphones, and tablets. Ultimately, each of these platforms will be configurable to some degree.

How Much Do I Need to Start Forex Trading in Kenya

How much do you really need to start trading forex in Kenya? Actually, not a lot!

Interestingly, most brokers in Kenya allow you to deposit as low as KES 100 ($1) and even lower in some cases.

However, traders are usually advised to place larger deposits to make it worthwhile. A number of brokers will recommend you start trading with at least KES 10,000 ($100) to make it financially feasible.

Forex Trading Companies in Kenya

EGM Securities (FX Pesa)

EGM Securities is the first forex broker to be licensed by the Capital Markets Authority (CMA) in Kenya. The Nairobi-based forex broker powers the FX Pesa platform that offers competitive spreads, innovative features, and floating leverage. The only forex broker supports 61 currency pairs with liquidity on the platform being provided by the world’s largest banks and liquidity providers.

To access the trading platform you need to register for an account. You can choose to sign up for a demo account or opt for a live account. A demo account will imitate the features of a live account but without the risk of trading using actual money.

Registration will require you to provide personal details including your full names, country of residence, and thereafter you will have to verify your account using a PIN sent to your mobile device.

The broker offers two types of accounts namely, Executive and Premiere. For as low as $200 you can start trading using an Executive account. The account offers a spread of 1.6 pips per standard lot for EUR/USD and leverage of 1:400. There are no commission charges for this account.

In contrast, the minimum deposit for a Premiere account is $5,000. The account charges a $7 commission fee. Normally the spread charged for a EUR/USD pair is 0.2 pips.

Features include:

• 60+ currency pairs
• $200 minimum deposit
• Leverage 1:400
• Spreads as low as 0.2 pips
• MT4 Trading Platform
• Demo account

Pepperstone

Pepperstone is CMA regulated forex broker. The online forex broker provides a customer rich experience with simple UI and superior features. Traders can download the MetaTrader 5 platform on their phone, tablet, or laptop and enjoy the customizable trading environment.

To begin trading on the platform you have to set up an account. Signing up requires you to provide personal information, trading preferences, income, employment, and agree to a declaration. Your account will have to be verified to complete the process. Alternatively, if you are new to forex trading you can sign up for a demo account.

The minimum deposit required is $150 and offers a leverage of 400:1. Moreover, Pepperstone supports over 180 currency pairs.

Features include:

• 180+ currency pairs
• $150 minimum deposit
• Leverage 400:1
• Spread from 0.0 pips
• MT4/MT5/cTrader Platforms
• Demo account
• Android and iOS app
• MPESA payments

HotForex

HotForex is an FCA, FSCA, and FSA regulated forex and commodity broker. The broker provides both retail and institutional clients with forex trading services. You can trade over 50 currency pairs on any of the HotForex trading platforms.

Registration on HotForex is a relatively simple process. Click on the ‘Open Live Account’ tab on the homepage and provide your personal details, residency, and email address. Next, review and accept the privacy terms and then click on the ‘Register’ tab. You may have to provide additional details such as the preferred currency. client type, and even create an investor profile. In addition, traders are required to upload certain documents to complete the account set up and verification process.

HotForex offers up to six accounts to cater to the risk appetite of different clients.

Features include:

• 50+ currency pairs
• KES 1,000 minimum deposit
• Leverage 1:1000
• Spreads from 0 pips
• MPESA payments
• Demo account
• 12 Trading Platforms

Scope Markets

Scope Markets is a Nairobi-based CMA licensed forex broker. If you are a new trader the platform has a rich knowledge base from whence they can learn the intricacies of forex trading. Moreover, you can sign up for a demo account to get a risk free start to forex trading.

You will need to sign up for a Scope Markets account to start trading. Signing up requires you to provide your personal details. Subsequently, you will have to upload certain documents and have them verified with compliance. At this point, your account is set up and you can fund your account to start trading.

Features Include:

• 40+ currency pairs
• KES 2,000 minimum deposit
• Leverage 1:500
• Spreads from 1.1 pips
• MPESA support
• Demo account
• MT5 Trading Platform

FXTM

FXTM is a Cyprus-based forex broker that is regulated by the FCA, FSCA, CySEC, and CMA. The forex broker offers a wide range of trading instruments and provides in-depth material on how to trade the forex markets.

FXTM boasts over 2 million customers and operates in over 150 countries. The forex broker offers segregation of funds across all these regions for retail customers.

To start trading on FXTM you have to register for an account. Registration requires you to provide your personal information, country of residency, email address, and set a password. Proceed to click on the ‘Send PIN’ tab to send the PIN via SMS or Email. Enter the PIN in the adjacent field and click on ‘Register Now’.

Depending on your requirements you can select any of the three account types FXTM offers. A Standard FXTM account has a $100 minimum balance, offers competitive spreads, and all-around offers. The Cent account allows you to deposit as low as $10, with competitive spreads and smaller trade sizes. The ECN Zero account requires you to deposit a minimum of $500, but charges no commissions, no requotes, and offers tight spreads.

Features Include:

• 55+ currency pairs
• $10 minimum deposit
• Leverage 1:2000
• Spreads from 0.1 on EUR/USD
• MT4/MT5 Trading platforms

Forex trading is a risky endeavor. The complex nature of forex markets requires you to learn market analysis and accurately keep track of currency movements. Therefore, it is advisable to start trading using demo accounts.

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