Company History
InstaForex was initially launched all the way back in 2007
and has been online since 2008. The brokerages main offices are based in the
Russian Federation, but the brokerage is incorporated offshore in the
Seychelles. The brokerage has a relatively limited profile in Europe, with the
company paying particular attention to attracting business from Russia and
South East Asia. The firm operates unregulated and has been in a number of scrapes
with global regulators. Despite a number of issues the brokerage continues to
operate and has a relatively large customer base.
Services
As the name suggests InstaForex is primarily focused on FX
trading, with the brokerage offering a total of 107 currency pairings of which
60 can be considered exotic. This a huge range of currency pairings for a firm
to offer, the wide range of pairings is in part due to the fact that the
brokerage operates as a Market Maker. In
addition to offering spot FX pairings, the brokerage also offers a range of
other markets, with clients being able to trade Precious Metals, Stock and
Indice Contracts-for-Difference (CFD’s). However the firm has garnered a lot of
attention for the prohibitive trading conditions, with the brokerage placing a
levy on profits made from trades placed during news announcements.
Additionally, the brokerage forbids scalping and will remove profits from
scalping related activity from client accounts. This has led to the broker
being rather infamous with many and some have speculated the brokerage operates
as a pure bucket shop.
The brokerage offers client the chance to trade using both
the MetaTrader 4 & 5 platforms from MetaQuotes. The MetaTrader platform is
by far the most popular trading platform among retail traders and by offering
both versions of the platform, the broker has been able to attract customers
from many emerging markets.
Regulatory
Information
The brokerage is registered in the offshore jurisdiction of
the Seychelles but has its main offices in the Russian Federation. As you may
neither jurisdiction has a regulatory regime for the provision of the
over-the-counter financial services, which means many FX brokerages based in
Russia become members of Self-Regulatory-Organisations. These SRO’s set out
requirements by which their members must abide, but do not provide any
significant regulatory oversight. InstaForex is a member of RAFMM and
Finotrebsoyuz, both Russian SRO’s which set out standards for their members. It
is important to note these organisations provide little if any regulatory
protection.
The brokerage has had a number of scrapes with regulators.
In 2013, the Bulgarian Financial Supervision Commission released a public
warning against the InstaForex and their Bulgarian subsidiary Insta Sofia. This
is due to the fact that the firm was operating within Bulgaria without being
regulated within a European Economic Area country, thus they were in breach of
European financial services regulation. In 2011, the CTFC
fined InstaForex a $140,000 for soliciting US clients without being
regulated by the appropriate authorities.
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