Dear Members
As most of you know trading forex for resident Indians is currently not permitted by RBI, there is no LEGAL way round this.
I know it is not a rationale rule but what to do ... rule is a rule.
Lots of people will give you B.S. stories about it being allowed and how the IT Dept. / Bank Officials and RBI dont know anything etc etc ... but in the end if you are caught then the person who told you its allowed will not be there to help you and will not take any responsibility, just remember that.
If you still have any doubt in the RBI press releases (although they are very explicit) please go and try to see RBI PRO for clarification.
-----------------------------------------------------------------------
Next point i want to make is you have to be very careful of Forex Brokers even if you are legally allowed to trade (if you have non-resident status or have some foreign citizen trade for you or whatever)
FX is largely unregulated even with the CFTC & NFA and all that. Firstly the NFA & CFTC are largely unlikely to entertain complaints from us Indians (being foreigners) & secondly even US citizens have lost money despite being regulated by these agencies.
Earlier Futures accounts were safe because the broker had to mark to market at the end of each trading day, but then Man financial went bust and account holders lost their deposits and then MF Global went bust and depositors lost their open trade profits plus part of their deposits and recently PFG went bust.
So if even futures accounts are not really safe what are the chanced of Forex accounts being safe? .... so be careful.
Lastly if after reading this & being aware of the very real possibility you could lose your account but you still want to trade I'd urge trade with a bank. ... (not sure if they all of them accept indians)
Or go to a broker who accepts a bank guarantee where you keep 80% of your money in your bank and only deposit 20% of the money with the broker.
This way you at least know that 80% is more or less safe even if the broker goes bust.
If this not possible then trade with very large brokers who are well capitalized and publically listed companies, this is still a risky option and the last one you should consider.
Under any circumstances do not fall for any of the chotta motta brokers as they are largely scams.
As most of you know trading forex for resident Indians is currently not permitted by RBI, there is no LEGAL way round this.
I know it is not a rationale rule but what to do ... rule is a rule.
Lots of people will give you B.S. stories about it being allowed and how the IT Dept. / Bank Officials and RBI dont know anything etc etc ... but in the end if you are caught then the person who told you its allowed will not be there to help you and will not take any responsibility, just remember that.
If you still have any doubt in the RBI press releases (although they are very explicit) please go and try to see RBI PRO for clarification.
-----------------------------------------------------------------------
Next point i want to make is you have to be very careful of Forex Brokers even if you are legally allowed to trade (if you have non-resident status or have some foreign citizen trade for you or whatever)
FX is largely unregulated even with the CFTC & NFA and all that. Firstly the NFA & CFTC are largely unlikely to entertain complaints from us Indians (being foreigners) & secondly even US citizens have lost money despite being regulated by these agencies.
Earlier Futures accounts were safe because the broker had to mark to market at the end of each trading day, but then Man financial went bust and account holders lost their deposits and then MF Global went bust and depositors lost their open trade profits plus part of their deposits and recently PFG went bust.
So if even futures accounts are not really safe what are the chanced of Forex accounts being safe? .... so be careful.
Lastly if after reading this & being aware of the very real possibility you could lose your account but you still want to trade I'd urge trade with a bank. ... (not sure if they all of them accept indians)
Or go to a broker who accepts a bank guarantee where you keep 80% of your money in your bank and only deposit 20% of the money with the broker.
This way you at least know that 80% is more or less safe even if the broker goes bust.
If this not possible then trade with very large brokers who are well capitalized and publically listed companies, this is still a risky option and the last one you should consider.
Under any circumstances do not fall for any of the chotta motta brokers as they are largely scams.