Forex Trading in Botswana

Know before you start Forex Trading in Botswana!

While there are forex brokers that are well regulated, there is also a big number that isn’t safe and regulated to be trusted by the traders. Before you start trading forex or give away your personal data to a ‘broker’, it is a good idea to learn a little bit more about the industry that you are willing to invest your money.

Forex Brokers in Botswana

Here are a few trustworthy Forex Brokers who are quite popular in Botswana. You can check the detailed review on these brokers before you open an account.

Is Forex trading legal in Botswana?

Trading Forex in Botswana is 100% legal and legit for every trader. NBFIRA,  Non-Bank Financial Institutions Regulatory Authority and Bank of Botswana are the regulators for the financial operations in the country. None of them prohibit Forex trading in Botswana. The Forex brokers listed here accept traders from Botswana. However, the traders should keep track of regulatory changes and stay compliant all the time.

Preferably open a trading account with the brokers having a local office in Botswana. Although it is legal to trade Forex in Botswana, you must always fulfill your tax liabilities towards the income generated from Forex trading.

Trading Software

The most popular trading platform in the Forex trading industry is  Meta Trader 4 (MT4), which is in use for decades. Although some traders use Web trading platform, MT5, and cTrader, MT4 is the widely used one.

MT4 Platform

Meta Trader 4 was released back in 2005 by Metaquotes Software and has become the most global used FOREX trading platform. As a result of its popularity, countless programs have been designed to work with MT4. Some create trading systems, and others are trading bots ( EA’s ) that make trades automatically based on algorithmic formulas.

MT5 Platform

Meta Trader 5 came after MT4, but it hasn’t been the knock-down success that many thought it would be. While MT5 does offer some features that MT4 lacks, many of the third-party programs made for MT4 won’t work with MT5. The major Forex brokers will allow you to choose which platform you want, and there really isn’t a one-size-fits-all solution.

How do the brokers make money?

Every broker has a different way of doing business. Some brokers offer 0 fees and include their profit from spreads, and others offer low spread with a commission on each trade. Every broker has its way to profit from clients.

Account Types

Demo account

After finishing signup, trader can create a demo account.  The traders use a demo account for practicing and experimenting with their trading strategies. You can open a demo account with a virtual balance of $1000 to $10,000 and start virtual trading in the real market conditions.  You can try the effectiveness of your market analysis and trading strategy. Try your money management plan in the demo account before applying it to your live account.

Real account

The only difference between a real account or Live trading account and demo account is that “The real account or Live Account involves real money.” You can select from several types of real accounts that suit your trading style, and set the leverage percent for your account. The next thing is to fund your account via the accepted payment methods of the broker. Then you are ready to start your real trading, which involves real money, real risk, and actual profit or loss.

Forex Glossary and Basics

Buy / Sell Orders :
By trading Forex, you will be able to participate on each side of the markets rising and falling pairs. If you see rising pairs, you could go Long-Term; if you see falling quotes, you may go Short-Term.

Commission :
With some brokers account you don’t pay any trading commission on most instruments, the brokers’ commission is inside the spread.

Spread :
The difference between the bid (buy) and offer (ask, sell) prices; in other words, the spread is the commission that the brokerage house applies to each trade of client. It can vary between currencies and between brokers.

Leverage :
The ratio of position’s notional value to the amount of margin required for opening a position for example (e.g., leverage 1:500 means that 100,000$ USD contract requires as low as 300 USD margin).

Lot Size :
Volume term in the Forex trading like bellow :

1.00 refers to 1 standard lot or 100,000 units of the local currency.
0.10 refers to 1 mini lot or 10,000 units of the local currency.
0.01 refers to 1 micro lot or 1,000 units of the local currency.
Margin :
The required equity that an investor must deposit to collateralize a position.

Ticks :
The smallest quote change for an instrument, for example, 0,00001 for USD/CAD rolling forex

Stop Loss Order :
Used to minimize exposure to losses if the market moves against an investor’s position.

Take Profit Order :
Used to fix level in the market to book the profit automatically on the investor’s open position.

Forex Broker in Botswana – Conclusion

There are plenty of opportunities in the Forex market to make extra money. The traders should learn how to make use of the opportunities and take advantage of them. After going through this article, the traders should now have an idea of what Forex trading is, and how to trade Forex. There are several Forex Brokers available in Botswana. We have reviewed FBS, IQ Option, easyMarkets, BlackBull Markets, and AVAForex for you, and found them trustworthy and reliable brokers. You can try them with a Free Demo Account with Free MT4 or MT5 platform.