JM Financial Review
JM Financial is an ECN forex broker, which offers two account types to its clients. The difference in the deposit requirements is pretty high, but you would get an effective 0.2 pips of better spreads. Swap-free accounts are also offered.
The Company. Security of Funds
Company Country Regulation
JM Financial Kuwait N/A
JM Financial is registered in Kuwait. The company is regulated by the Ministry of Commerce in the State of Kuwait. This may be slightly better than no regulation, but it is essentially the license every company must attain. in order to operate in the country. Essentially this isn’t any form of financial oversight.
As you may know, the regulatory environment is an important factor when determining a broker’s credibility. Most countries have some sort of institution which apply strict rules to the companies in the financial services industry. One such regulator, the UK’s Financial Conduct Authority, requires forex brokers to keep clients’ funds in segregated accounts, which implies the broker doesn’t have free access to the money. This goes a long way in preventing fraud. Furthermore, all FCA regulated brokers take part in the Financial Services Compensation Scheme (FSCS). This is a mechanism which forces companies to set aside some of their profits, creating a pool, which serves as insurance in case one of them goes bankrupt.
These are benefits you would not receive, if you decide to trade with JM Financial. That being said the company may be running a legitimate business. The lack of specific financial regulation does not automatically mean they are scammers, but it lowers their credibility, when compared to other well-regulated brokers.
Minimum Initial Deposit
JM Financial has a $100 minimum deposit requirement. This is a reasonable amount, for testing the broker’s service. Lots of brokers have set even lower entry barriers, in order to attract curious people, who just want to see what trading is, without risking much. One such broker is FXTM, requiring only $5 for opening a cent account with them.
That being said, a serious long-term trading plan requires much more adequate capitalization. In other words, the minimum deposit shouldn’t be a major factor when comparing brokers.
Average spreads & Commissions
Spreads at JM Financial are variable, with commissions being added to each trade. Our tests during the most liquid market session saw the EUR/USD spread gravitating around 0.3 pips. Keep in mind you must add the commission to every trade. If you have a Gold account, the spread would effectively be around 1.4 pips (1.2 for the Platinum). This is in-line with current offers by other brokers. You can check a real-time comparison of spreads offered by some of the world’s leading brokers here.
The maximum leverage offered by JM Financial is 1:200 for the most liquid currency pairs. More exotic pairs have different margin requirements. This is an interesting approach, which most brokers usually apply to certain instruments before major political events. For instance, the leverage ratios for all pairs including the GBP were reduced before the Brexit referendum.
Although some brokers offer even higher leverage, 1:200 is more than enough for a strategy, involving some sort of risk management. Higher leverage may sound great, but it can also be very risky. Your losses will be amplified, the same way as your profits. This may even lead to losses exceeding your initial investment. There is a reason why US regulators have caped the leverage offered by forex brokers at 1:50.
JM Financial provides the popular MetaTrader 4 (MT4) platform. It is offered by many different brokers, who prefer a solid solution instead of investing in the development of their own in-house platform. MT4 has many advantages. For one, its popularity has led to the development of many custom indicators and automated trading systems (Expert Advisors) who are not broker-dependent.
The platform’s charting capabilities are top-notch, although seasoned traders hate the lack of multiple monitor support.
Methods of Payment
JM Financial only works with bank transfers at the time of writing of this review. This is quite frustrating for people who are used to their instant payment solutions, such as Skrill or Neteller. International bank transfers may take several business days and can include high fees.
JM Financial is a forex broker, operating out of Kuwait. The company is registered there, but does not fall under any specific financial oversight. This leaves mixed feelings in us. Trading conditions offered there are relatively competitive.
JM Financial Review Conclusion
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