In recent months the Capital Markets Board of Turkey, the Turkish regulator implemented dramatic changes on the way the industry functions. Among the changes were the new requirement for a minimum deposit of TRY 50,000 for any Forex trading account, and a maximum leverage of only 1:10, lower than even The United States’ NFA imposes. The Turkish Capital Markets Association has tried to ease these restrictions but has thus far been unsuccessful in reversing these unquestionably harsh restrictions.
Traders and Forex brokerages are concerned that the restrictions will cause lower trading volume and liquidity which will force traders to pay higher spreads and will thus perpetuate a spiral of lower trading volumes or will cause Turkish Forex traders to pursue trading offshore trading opportunities, which at this point have not yet been thwarted by Turkish regulators (and the question remains as to whether Turkish regulators will be able to control offshore trading activities for its nationals due to the open nature of the global currency markets).
There have been several Turkish Forex brokers who have paused their business activities in response to the regulatory changes, and other who have closed their doors entirely. But interestingly, there have also been several new, unregulated brokers located outside of Turkey’s physical borders that have begun recruiting Turkish Forex traders. Whether or not the Capital Markets Board will come after these brokers remains to be seen, but there’s no question that the shift in the industry has been significant. We will continue to monitor the situation and to report on the newest regulatory changes as they become relevant. We will also continue to monitor the activities of Turkish Forex brokers and to honestly review the remaining brokers that can accept Turkish traders. If you’re interested in trading Forex in Turkey don’t let the regulators scare you – just make sure that you know how the market functions before you get started.