If you live in Hong Kong, the first question you need to ask is whether you should trade on your own or with a broker. This has nothing to do with trust issues, but you can get information from different sources with the level of information. As a rule of thumb, if the trader is an adult resident of Hong Kong, trading on their own from their HK-based computer does not require any license.

We’ll discuss this more in a minute, but basically, a Forex dealer needs a special license to accept payments and manage accounts of non-residents—to wit: non-Hong Kong residents.

Who would benefit from trading with a broker?

Many people don’t have much time to monitor the news or follow other analysis methods. Since you can’t afford to miss even a single 1-minute candle, it might be worth paying someone else to do your trading for you. Many services offer Forex signals, which may suit people who are too busy with work or travel.

Of course, not all these “signal providers” are reliable enough. It is best to know what kind of trader you are first before looking for signal service providers—are you good at details? Do you have an interest in how markets move? Are you patient? If so, manual trading could work well. The bottom line here is that if there’s one thing Hong Kong should never lack, it’s traders.

Who needs a broker?

If you are starting or have no idea what you’re doing, self-directed brokerage with the right educational background could be pretty dangerous. It may help to know that brokers are not all created equal—some of them don’t even care about your experience.

They want your commission. So it’s essential to do some homework first before giving anyone access to your bank account. It’s advisable to only deal with reputable brokerages with a solid track record like https://www.home.saxo/zh-hk/products/forex.

About licenses

As mentioned earlier, for residents who wish to trade forex on their computer, it is OK as long as they are over 18 years old and have an existing bank account with sufficient funds (the minimum initial deposit varies from one broker/dealer to another).

For non-residents, though, getting a Forex dealing license is quite tricky since you are expected to have a local corporate sponsor.

These are the essential prerequisites for getting a Hong Kong currency dealer’s license:

• An applicant must be of good character and integrity. The applicant must not have been prosecuted by any court or government agency regarding an offence involving fraud or dishonesty within the previous five years.

• The applicant should have sufficient financial resources to carry on currency trading business without being dependent upon other sources of income which might lead to a conflict of interest.

• If previously registered as a currency trader with another Securities and Futures Commission regulated entity, the applicant will need to demonstrate that they have ceased all currency business activities immediately before applying for registration as a currency dealer with the SFC.

What if you live in Hong Kong but are not a resident?

In that case, getting a license may be a bit more complicated since you will need a local sponsor who is legally registered as a business in Hong Kong and willing to take responsibility for your actions.

As simple as it seems, this usually takes at least 2-3 months of paperwork since the broker has to apply on your behalf. If they have any doubts about whether you can keep yourself from breaking the law, they won’t risk their business by taking you as a client! What’s worse is that some brokers don’t reveal these requirements until after paying them for the signals service.

Also, you should be aware that the SFC has imposed strict margin requirements for currency dealing transactions. For instance, if an account has a net margin requirement of at least HK$200,000, the client must maintain trading equity (i.e., maximum account balance less top unrealised open positions) of at least HK$100,000 at all times while carrying out the dealing transaction.

Suppose an account’s equity falls below this level while entering a dealing transaction. In that case, we will advise you not to proceed with it and recommend that such a dealing transaction be cancelled immediately.