Introduction to Forex Trading in Nigeria
In recent years, the popularity of investing and trading forex has been growing steadily in Nigeria. A variety of web statistics show that Nigeria, as well as other African countries, are the most engaged demographics in forex trading topics.
Some examples to highlight the strong popularity of forex trading in Nigeria include;
- 4.3% of the 2.5 million visitors to the BabyPips forum are from Nigeria
- 10.7% of 1.2 million visitors to the FXTM website are from Nigeria
- Nigeria ranked 7th for Google web searches for the phrase “forex”
- Nigeria ranked 4th for YouTube searches for the phrase “forex”
What Makes Forex Trading Popular in Nigeria?
Forex trading is popular amongst Nigerians for many reasons. Firstly, the youth unemployment rate is almost 20%, which is incredibly high. Secondly, Nigeria has the 6th largest number of internet users. Lastly, Nigerians have above-average levels of English literacy amongst developing countries. These reasons make the country a popular destination for forex brokers.
Is it Legal to Trade Forex in Nigeria?
While there is no formal regulation to cover FX and CFD trading, it’s not illegal. Because it’s not illegal to trade with foreign brokers this opens to door to choose from many options. This variety lets you even select the regulator framework of the broker you will trade with.
The disadvantage of choosing a foreign broker is that their investor protection schemes may only cover domestic clients. That said, it’s probably better to choose an international broker who has a rulebook to follow as opposed to a local Nigerian forex broker which is completely free of oversight.
It’s worth noting that the Central Bank of Nigeria, also known as the CBN does regulate the country’s foreign exchange market. However, this regulation covers the physical Inter-bank Foreign Exchange Market and Bureaux de Change services.
Forex trading is a derivative, which means a separate framework is required to regulate the business. The Central Bank’s regulations do not cover the type of trading you do on cTrader or MetaTrader 4. While some international forex brokers may accept Naira for making deposits to your trading account most will convert that deposit into USD or another popular instrument and also won’t offer Nigerian Naira trading pairs.
cTrader Forex Brokers in Nigeria
In the past, we have reviewed a couple of cTrader brokers that are based in Nigeria. Those reviews include HAXI Capital and Fintec Global Markets. However, we concluded that those two brokers are not credible options for investing your money with.
The overwhelming majority of international forex brokers accept clients from Nigeria, so there is little reason to search for a brokerage based in Nigeria.