High Leverage Forex Brokers Ireland
Compare high leverage Forex brokers with leverage up to 1:500 in Ireland, including the "Best Forex Broker With High Leverage" in 2023 for TrustedBrokers.com.
By Stefan on 23/09/2023
- FP Markets Best Trade Execution - APAC...
- Pepperstone Best Forex Broker Overall -...
- 4XC Best Customer Service 2022
FP Markets is a true ECN broker with razor-thin spreads and deep liquidity. Trade CFDs on over 1,000 stocks, indices, commodities and currency pairs through MetaTrader 4 or 5. FP Markets supports all trading styles and EAs.
Pepperstone (Pepperstone.com) is an award-winning broker regulated in 7 jurisdictions. Trade over 1,200 instruments on MetaTrader 4, 5, TradingView or cTrader. Pepperstone allows all trading styles, with no restrictions.
- Risk warning: Between 74-89% of retail investor accounts lose money when trading CFDs. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
- Markets: Forex (CFD), Cryptos (CFD)*, Stocks (CFD), Indices (CFD), Metals (CFD), Energy (CFD), Commodities (CFD)* Availability subject to regulation.
- Platforms: MT4, MT5, cTrader
- Regulators: Australia, Bahamas, Cyprus (EU) , Germany, Kenya, UAE , UK
4xc.com is an offshore broker founded by Forex industry veterans. Trade Forex, metals, oil and stocks with leverage up to 1:500. 4XC accepts all trading styles and Expert Advisors on MT4 and 5.
- Risk warning: Trading Forex/CFDs on margin carries a high level of risk and may not be suitable for all investors as you could sustain losses in excess of your deposits. You should carefully consider your financial situation and experience level before trading.
- Markets: Forex (CFD), Cryptos (CFD)*, Indices (CFD), Metals (CFD), Energy (CFD)* Availability subject to regulation.
- Platforms: MT4, MT5
- Regulators: Cook Islands
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Best High Leverage Forex Broker Ireland in 2023
FPMarkets.com is TrustedBrokers' Best Forex Broker With High Leverage in 2023. Trade over 60 currency pairs and precious metals on leverage up to 1:500, stock indices up to 1:200 and crypto up to 1:2.
FP Markets supports all trading styles and Expert Advisors, including scalpers and trading robots. It also offers a wide choice of platforms: choose between MetaTrader 4, MetaTrader 5 and Iress (also available on iPhone and Android).
FP Markets has partnered with leading financial institutions to ensure a deep liquidity pool, so that you get the best available market prices with ultra-low speeds (under 40 milliseconds). Choose between a Standard Account with spreads from 1 pip, and a Raw Account with spreads from 0 pips plus a low $3 commission per side. The Standard Account is designed for new traders, whereas scalpers and day-traders tend to prefer the Raw Account.
FP Markets Group is an Australian owned and operated group of companies. It is regulated in Europe, Australia and St. Vincent and the Grenadines. Funds you deposit will be held in segregated accounts with AAA-rated Australian banks. On a personal note, we've been consistently impressed by the quality of its customer service, available 24/7 in over 12 languages. Visit FPMarkets.com to open an account in minutes.
Pros and cons of leverage
First, let's define leverage. Leverage entails borrowing money from your broker to increase your buying power. Let's say you have $1,000 to invest and you want to buy a stock that's trading for $50 per share. Without leverage, you could only buy 20 shares. However, you could buy 10,000 shares, 500 times more, with a broker that offers 1:500 leverage like FPMarkets.com.
What are the pros of using leverage?
Leverage has the potential to significantly increase your profits. With more buying power, you can take larger positions and potentially make more money than you otherwise would. This can be advantageous if you have a high level of confidence in a particular trade or know how to trade volatile markets.
Leverage can also provide greater flexibility in your trading strategy. With more buying power, you have more options for how you allocate your capital. For example, you could take a larger position in a single stock, or diversify your portfolio across more stocks.
What are the cons to using leverage?
Leverage is a double-edged sword that will amplify your potential losses as well as your profits. Worryingly, circumstances can arise when potential losses will more than exceed your initial margin, unless your broker offers negative balance protection. This is perhaps best understood through a simple example.
Let's assume you bought 10,000 shares in ABC Company for $50 each with 1:500 leverage, off the back of your $1,000 initial deposit.
If the share price were to rise from $50 to $55, your account would show $50,000 in unrealised profits. This amount is calculated as $5 x 10,000 shares.
However, by the same account, a $5 fall in the company's share price has the potential to bring about $50,000 in unrealised losses, an amount that far exceeds your $1,000 deposit.
You may be tempted to simply "sit it out" and wait for your investment to turn a profit. However, your broker won't give you the benefit of the doubt. Instead, you'll receive a margin call, which is a requirement to provide additional funds. Your broker will automatically close your positions and crystallise your losses if you're unable to meet that call.
Leverage can also lead to emotional decision making because the stakes are higher when you're trading with borrowed money, especially if you have a low risk tolerance. It's easy to become overly emotional and make impulsive decisions. This can lead to a vicious cycle of losses as you try to make up for previous losses with even riskier trades.
Research has shown that traders who use lower leverage experience better outcomes. A study that compared investor outcomes before and after the application of leverage limits in the US foreign exchange market showed that lower leverage improved outcomes for the highest-leveraged clients by 18 percentage points per month and reduced their losses by 40%(1).
Regulatory restrictions on leverage
These risks explain why many regulators have sought to limit the amount of leverage available to retail clients.
In the European Union, the European Securities and Markets Authority (ESMA) reduced leverage available to retail clients as early as August 2018(2). These restrictions vary by asset class, and reflect each asset class's volatility:
- 1:30 for major currency pairs;
- 1:20 for non-major currency pairs, gold and major stock indices;
- 1:10 for commodities other than gold and non-major stock indices;
- 1:5 for individual equities and other reference values;
- 1:2 for crypto-currencies.
In the UK, the Financial Conduct Authority (FCA) mirrored ESMA's restrictions on leverage in July 2019(3). These restrictions remain in place to this day.
In Australia, the Australian Securities & Investments Commission (ASIC) reduced leverage available in retail clients to between 1:30 and 1:2 in March 2021. ASIC recently extended these restrictions until May 2027(4).
Ways around restrictions on leverage
There are more ways than one to open an account with a high leverage Forex broker, even if you live in Ireland.
First, you could open an account through the offshore entities of the brokers reviewed in this article. Most brokers also offer negative balance protection, which means that you cannot lose more than your initial deposit. This is important if you trade on margin. However, you should note that few offshore jurisdictions offer investor compensation schemes.
Alternatively, you may be able to access a high leverage trading account if your broker classifies you as a professional client. Client categorisation rules vary from broker to broker, however, they generally combine qualitative and quantitative criteria. You may be eligible if your investment portfolio exceeds €500,000, you trade significant amounts at least 10 times per quarter, and/or you have worked in financial services related to CFD trading.(5).
However, you should be aware that you'll lose all protections available to retail clients as soon as you become a professional client. This includes negative balance protection. Your broker will outline the protections you'll stand to lose in writing before changing your status.
Risk management best practices
Trading with leverage has the potential to significantly increase your profits. However, it can also work against you if you follow poor risk management practices.
Here are 5 things you could do to protect your capital:
- Use low leverage, if any at all, until you are comfortable with how leverage works. And use less leverage when trading volatile asset classes or financial instruments.
- Use stop-loss orders to close loss-making trades early before they grow too large in size. Study technical analysis to identify entry points and stop-loss targets.
- Keep your your position sizes low, and avoid going "all-in" on a single investment or correlated investments. This will also help you sleep better at night, as your portfolio will be more resilient when the market moves against you.
- Keep money on the side, available for a margin call. This will prevent your broker from automatically closing your positions and crystallising unrealised losses when the market moves against you.
- Finally, you could also raise your cash balances and reduce your exposure in the run-up to central bank interest rate announcements or economic data releases, as these events can cause unexpected market movements.
Leverage can be a valuable tool for traders, but it is important to use it wisely. Make sure you understand the risks involved before using leverage, and never risk more money than you can afford to lose. If you are new to trading, you may consider opening a demo account first, or a live trading account with a small balance.
- 1. Rawley Z. Heimer & Alp Simsek. (2017). Should Retail Investors' Leverage Be Limited?. https://www.nber.org/papers/w24176
- 2. European Securities and Markets Authority. (2018). ESMA adopts final product intervention measures on CFDs and binary options. https://www.esma.europa.eu/press-news/esma-news/esma-adopts-final-product-intervention-measures-cfds
- 3. Financial Conduct Authority. (2019). FCA confirms permanent restrictions on the sale of CFDs and CFD-like options to retail consumers. https://www.fca.org.uk/news/press-releases/fca-confirms-permanent-restrictions-sale-cfds-and-cfd-opt
- 4. Australian Securities & Investments Commission. (2022). ASIC's CFD product intervention order extended for five years. https://asic.gov.au/about-asic/news-centre/find-a-media-release/2022-releases/22-082mr-asic-s-cfd-pr
- 5. Financial Conduct Authority. (2023). Client Categorisation. https://www.handbook.fca.org.uk/handbook/COBS/3.pdf
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