Forex trading refers to the foreign exchange market that involves buying and selling of global currencies. The Forex market is a global-level marketplace that has footholds in both the online world and real life. Trading of currencies is very profitable if you have the understanding of how to do it. Investors have started using the Forex exchange to a great extent because of the current regulations that are set upon them. They have identified the Forex exchange as a great substitute to their problems, hence why it is so popular amongst investors.
People understand that trading of currencies has the potential of bringing you excellent monetary returns, but in order to be successful in the trading of currencies, you need to know how to do it.
Forex Trading in India
Forex trading is an investment concept quite new to India, one that should be explored more than it is. The opportunities that come with Forex trading has popularized it amongst Indians, but there are definitely problems that pose a great threat to it.
Namely, one of the biggest problems facing currency trading in India is the fact that brokers are unreliable. If we take that into account plus the seemingly big “risks” involved with Forex trades, we can understand why the Indian government has put certain restrictions onto traders and trades. If you want to know more in-depth about these restrictions, and a place where you can find the best Forex Trading Brokers in India, then read more.
Forex trading in India is legal if you are using Indian rupees as the base currency. The central authorities that govern Forex trading in India are the Reserve Bank of India (RBI) and Securities Exchange Board of India (SEBI). These two governing bodies oversee all currency trading in India, both online and offline. If you want to trade overseas, then you might be subjected to legal charges. But you can become a legal Forex trader in India if you follow all the rules and regulations.
To be a legal trader, you must use the Indian Rupee as the base currency; that way you are 100% legally protected. Other currency pairs that both SEBI and RBI allow are USD to INR, GBP to INT, and EUR to INR.
Forex Brokers in India
As we mentioned earlier, to become a Forex trader, you will need to find a broker. Brokers are quite flexible in the Western world; however, the case is not the same as India. You don’t have the flexibility option in India’s currency trading, so you would need to use one of the government authorized brokers. While brokers aren’t the most reliable in India, there is a way to ensure their validity. Firstly, you will need to check if the broker is authorized with SEBI. If he is, then you are safe because the broker’s platform is fully legal.
Furthermore, Indian currency trading platforms will allow you to trade with INR and pair it with other options such as EUR, GBP, USD, and JPY.
It’s safe to say that currency trading is not that popular in India due to the strict government regulations. If these regulations can be somehow changed, then Forex trading could see a massive surge in popularity with Indians.