South African Rise of Online Trading


Today, close to 15 million people choose online trading as their primary or secondary source of income. In South Africa, the activity has been popular for a while. Thanks to changes in legislation, many international brokers have set their sights on the region. Today, during the lockdown, their services are in high demand.


Forex has been gaining momentum since the 2010s. By 2016, the segment grew to USD 21 billion in South Africa alone. Trading was also embraced by other regions: Kenya, Namibia, Angola, Tanzania, Rwanda, and Botswana. So, what are the drivers of the trend?

The Appeal of Online Trading
It is now clear the local population is interested in trading through the internet. Currencies, stocks, and other instruments allow individuals to make profit remotely. This advantage is particularly noticeable when millions are stuck in their homes, and unemployment is accelerating.

Residents of South Africa may now access the global currency exchange, the largest financial market worldwide. Every day, it sees volumes of over $6 trillion circulate between institutions and retail players. The potential is undeniable, as long as newbies are willing to learn and develop their foresight.

As traders hone their skills, they explore more options. Trading terminals are also suitable for diversified portfolios of assets. These may include currency pairs, stocks, CFDs, and more. This way, risks are lower, while potential returns go up.

Key Factors
According to the latest estimates, close to 50 million people use mobile internet in the country. By 2023, their number is expected to reach 85%. This is a vast audience, and it is in desperate need of financial support.

Unemployment is dramatic. Roughly 30% of the young generation do not have a job. Now, this figure is rapidly growing, as businesses are going bankrupt due to COVID-19. It is thus not surprising that more and more people are attracted by Forex advertisements. Overall, the strongest drivers are:

●      growing internet penetration,

●      extreme unemployment,

●      low cost of entry, and

●      marketing.

Favourable Conditions
As brokers tailor their conditions to regional needs, entry is affordable. Initial deposits may be very modest. Cent accounts offer access for just $10.

Aside from cheap entry, brokers offer other advantages. Accounts denominated in Nigerian Naira are now common. Meanwhile, accounts in USD may involve no conversion fees. In many cases, depositing is instant. All of these factors contribute to the allure, and growth is accelerating.

Clients have access to a wide range of instruments. These are currency pairs, stocks, and derivatives. It is possible to develop diverse portfolios covering a wide scope of tools. Virtual derivatives allow traders to benefit from market trends without owning the underlying assets. Here, profits may be tied to:

●      stocks,

●      commodities,

●      market indices,

●      cryptocurrencies, etc.

All operations are conducted via special trading terminals. Popular systems like MT4 work on both desktop and mobile devices. They are packed with visual aids that facilitate profitable decisions. Through their trading platform, a client analyses the market, opens and closes positions, and manages all other aspects of the activity.

Current Regulation
In South Africa, aspiring traders may choose between local and international firms like FXTM. FSCA (the Financial Sector Conduct Authority) has been taking measures against fraud. All brokers based in the country are obliged to acquire a license. Moreover, they have to provide a watchdog with access to transaction data.

Motives of International Brokers
Most of these providers are headquartered in Europe. Due to recent changes in EU legislation, the region has lost its appeal. Leverage is now restricted, and bonuses are outlawed. South Africa is an attractive destination due to less stringent regulations.


Future of Online Trading
The arrival of global firms is likely to continue. It will also be spurred by tightening of restrictions in Australia. Residents of South Africa have a broad choice. They monetize financial knowledge and profit from trends in the global markets.

However, caution is essential. As the segment is booming, unlicensed operators attract victims via aggressive advertisements. International companies are more reliable, as they are officially licensed and controlled by monitoring entities, such as CySEC. Their clients do not need to worry about the security of data or the safety of their funds. Instead, they can entirely focus on their strategies, and turn trading into a steady source of income.

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Expansion of online trading opportunities in South Africa
Residents of South Africa trade currencies and other instruments online. The region is attractive to global brokers, and growth is robust. Here is why.
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