Trying to find the best online broker Germany is no easy task. Fortunately for you, we are up to to the challenge of taking all the best forex brokers and making a shortlist for our Germany based traders.
Europe’s Largest Economy Is An Attractive Market For The Best Online Brokers
Germany is the most populous of the full European nations, aswell as the largest economy. Current estimates put the number of residents at 83 million, with a GDP of $4trillion earning a placing of 4th globally. The populations of both Russia, and Turkey, respectively are greater than that of Germany, but both straddle the line of Europe and Asia.
The locals of Germany are usually very quick to adopt online solutions, and forex trading has been no different. There are many an online broker that have decided to set up in Germany to take advantage of that fact, and gain access to one of the best global forex, and stock trading communities.
Trading Regulator BaFin Leads The EU In Creating A Safe Space For Forex
The best forex broker in Germany will undoubtedly be registered with the local agency The Federal Financial Supervisory Agency, hereto referred to under the shortered version BaFin. The regulatory framework in Deutschland is one of the most robust globally, and has helped to create a market for online trading that is both safe and secure.
Regulation is vital in all areas of compliance, but when it comes to trading your hard earned Euros, it is an area that cannot be overstated in its importance.
Online brokers around the globe are interested in developing relationships with Germany, and the BaFin regulation is a stamp of approval that they are indeed prepared to take those extra steps required in order to market forex trading to the local audience.
We have heard of brokers’ applications taking multiple years to be completed, due to the rigorous and extensive checks that the regulator undertake. Whilst this makes things more difficult and costly for the broker, it provides an additional level of confidence to users trading with BaFin regulated brokers. To check out the various different global regulators, see here.
An economy with services and financial services at its’ core
Germany is formed of 16 regions, with the financial services industry and stock market largely situated around Frankfurt. Financial Services form a core part of the largest sector by total contribution to GDP, with financial, renting and business activities making up more than 30% of total GDP. This highly developed infrastructure, and skilled workforce will continue to drive the importance of Germany to the Global and European markets into the future.
There are actually 7 regional stock exchanges in Germany, but the largest and most active of which is the Frankfurt Stock Exchange. Owned by Deutsche Börse AG and Börse Frankfurt Zertifikate AG, this is home to the Xetra trading venue and DAX index. Xetra handle more than 90% of annual stock trades relating to the German indices. It is also here in Frankfurt that physical brokers, aswell as online brokers typically tend to base themselves.
How To Find Online The Best Forex Broker In Germany?
We will focus on some key aspects that are important to the local market when considering which is the best online broker Germany; you find below our 8 most important points
Regulation or registration with BaFin is the preference. As we have mentioned in this guide above, the German regulator has some very good ‘checks and measures’. This strong regulation framework is a great advantage for the Germany based trader, and having a local regulator usually makes any disputes that much easier.
We will consider brokers that have registered with BaFin but have their core regulation elsewhere in Europe, preferably by the Financial Conduct Authority of the UK but also CySEC. You can search the BaFin register here.
The addition of CySEC regulated brokers will become a necessary secondary option in the case of passporting issues that may arise once the final deal on the UK withdrawal agreement from the EU is confirmed.
2. COSTS TO TRADE
An ultra competitive fee model is always going to carry some extra weight when rating the best online brokers in the trading industry.
Let’s face it, regardless of the Country you are trading from, keeping unnecessary costs to a minimum would be something that every trader of forex or stocks would be looking for.
The less that is spent on spreads, transaction fees, and broker commissions the better for your trading balance… that is what the best online brokers in Germany should deliver.
A great choice of the most popular markets and instruments to trade is a necessity. We would always need to see a wide variety of forex pairs for any of the best forex brokers, in Germany it is no different.
When considering local traders, the Euro would be provided as standard option against the other major global currencies. It would also be favourable to see Indices offered by the best online broker in Germany, particularly that of the DAX.
The choice to trade stocks on locally listed companies would be a positive, as it would be an online broker that can support multiple assets that has the best overall proposition in Germany.
4. MOBILE PLATFORM
The broker will need to show a commitment to delivering the best mobile app possible. Trading is moving online, and into the hands of the retail trader on the move. Germany in particular has been a quick adopter of technology in Europe and trading on apps and on mobile is a vital component.
Whilst many more serious German based daytraders may still want some of the additional functionality that desktop provides, and the ability to use many screens simultaneously, keeping track of your trading on the move is becoming more and more important by the day.
5. FUNDING METHODS
Providing a good option of deposit and withdrawal methods is almost as important as the product offer for some. Each trader, and each country, have their own preferences it seems for payment methods.
It has been noted that a lot of developing nations in particular show a preference for e-wallets and alternative payment solutions, whereas some of the more mature countries are still quite comfortable with more traditional bank deposits.
From our experience, Germany has a great range of individuals, and the only way to provide the best support possible is to offer a wide range including both digital and more analogue methods of deposit and withdrawal. This will help to ensure the best online broker is reaching the widest possible audience in Germany.
6. PRACTICE TRADING
The best online broker has a no limit, free demo account.
Whilst demo accounts are not commonplace when it comes to stocks, a broker that does offer that function will definitely help to give a better overall experience.
All forex traders should have access to a demo account to test different strategies and the winner of best forex broker in Germany will surely have this for all clients as standard.
A full trading experience in German language is an absolute necessity to be considered the best online broker.
Whilst Germany has one of the highest adoption rates of English globally and has a very capable multi-lingual population, it is essential to provide native language in Germany in order to give the best possible trading offer.
There are many nuances to trading in both forex and stocks that are easier to understand, and frankly just better when in the mother tongue.
8. CUSTOMER SERVICE ETHOS
Great Customer Service cannot be underestimated in any Country but here again in Germany it takes on extra importance. The native German language support from customer service is a must have.
For any highly developed and mature economy, there needs to be a real focus on service standards. As alluded to, Germany has a huge services industry as part of its economy. Financial Services is a very mature industry here, and as such, the support offered from financial services is over and above that which may be acceptable elsewhere.
The support agents need to be knowledgeable, quick to offer insight, helpful, and ideally multi-lingual, in order to best support the German audience.