[XM Trading: For Forex Beginners] Relationship between Japan’s Financial Services Agency and XM

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About XM

XM Trading is a world-famous FX company, but it is not registered with the Japanese Financial Services Agency. Therefore, some Japanese say that XM is a dangerous and illegal Forex company. On the contrary, it is true that there are traders who can only use XM in excellent companies. So I investigated the relationship between XM and the Financial Services Agency, so I wrote an article.

Financial Services Agency and XM

The Financial Services Agency (FSA) is an organization that conducts general operations related to finance, establishes systems, and supervises them. Since XM also falls under the financial trading market, I feel that it is necessary to register with the Financial Services Agency as long as Japanese traders use it, but that is not the case, that is, it is unregistered. However, XM is not a Japanese company and is not a company operated exclusively for Japanese people. Since customers are all over the world, it is outside the jurisdiction of the Japanese Financial Services Agency, and even if it is not registered, it is not illegal and there is no application of law. In the FSA, it is listed in the warning list of unregistered traders as a FX company that is not registered with the Japanese FSA. However, there is no need to worry about it because it is not because you have done something wrong with the trader or because there is an illegal operation.

XM is not a Japanese Forex company

Despite XM becoming a world-famous major FX company, there is a reason why it is not registered with the Financial Services Agency in Japan. This is for the following reasons.

Trading with high leverage

Foreign Forex companies such as XM have no upper limit on leverage, and there are companies with 3000 times higher leverage, making high leverage trading with a small amount of money attractive. XM’s maximum leverage is 888 times, but if you register with the Japanese Financial Services Agency, there is a law that will reduce the maximum leverage to 25 times. In that case, dynamic trading with a small amount of money becomes impossible, and there is no reason to use XM.

Zero cut becomes unusable

XM has a zero cut system that will bear the excess loss when there is a loss that exceeds the account balance. There is no additional proof, so you will not be in debt. The zero cut system is prohibited in Japan, so it cannot be used. Therefore, from a trader’s perspective, if XM is registered with the Japanese Financial Services Agency, it will be at risk.

bonus regulation

XM currently has 3 types of bonuses and has a reputation for being more luxurious than other companies. Just by opening an account, 3000 yen is added according to the deposit amount, and all bonuses such as point reduction according to the status can be used as funds for trading. However, Japanese Forex companies are in a conflicting relationship that does not benefit the company unless the trader loses. For this reason, trading with a Japanese Forex company has no merit for traders.

Is XM a safe company?

Even though XM is not registered with the Japanese Financial Services Agency, it has acquired multiple licenses from various countries that are difficult to obtain and maintain.

financial license

XM is a company that started in Cyprus and continues to expand its branches in Australia, Belize, England, Dubai, Seychelles, etc. That said, the performance is pretty good. We also have a good license.

  • CySEC (Cyprus Securities and Exchange Commission)
  • FCA (British Financial Conduct Authority)
  • ASIC (Australian Securities and Investments Commission)
  • Seychelles Financial License

Separated management/Trust maintenance

XM keeps client funds segregated. Segregation is how you manage your funds outside of XM. Furthermore, the separate management method is trust preservation. Trust preservation means that the management of segregated management is a bank trust account. If the trust bank trust is preserved, even if the FX company goes bankrupt, it will not be subject to seizure.

ample funds

XM overwhelms other Forex companies with capital strength. It is said that XM’s capital exceeds 40 billion yen in Japanese yen, and there is no other Forex company that beats this. Proof of this abundant amount of funds is the official sponsorship of Usain Bolt. If you don’t have a lot of money, you can’t use that celebrity as a sponsor.

Withdrawal refusal

XM has been operating for more than 10 years, but so far there have been no malicious problems such as withdrawal refusals. Therefore, there are no major complaints from users, so it is not a place to worry so much.

Over 10 years of operating experience

XM was founded in 2009 and has been in operation for over 10 years and is a very famous Forex company, so it is not a malicious company that steals funds and escapes. As a result, stable management has been achieved, and there are no uncertainties in the future.

No warning from FSA

So far, XM has not received any warnings or penalties from the Financial Services Agency. You can rest assured that it is not registered because you want to maintain zero cuts and high leverage, and the FSA does not see it as a problem.