DomiFX is a broker, providing forex and spot-metals trading. The company has a focus on the Chinese market and “Social Trading Plus”, a website offering a social trading scheme, similar to Zulutrade.
The Company. Security of Funds
DomiFX is licensed by the Vanuatu Financial Services Commission (VFSC). This may be better than a totally non-regulated company, but still off-shore regulators do not inspire a lot of trust.
Vanuatu, in particular, is the new hot spot for shady forex brokers. The VFSC’s requirement of having $2,000 in capital attracts all kinds of companies. On the other hand more reputable financial watchdogs, like the UK’s FCA, have put bigger requirements (in the FCA’s case € 730,000) to ensure only brokerages with a long-term vision will even attempt to register.
While we are on the topic of the FCA, it also enforces stringent rules on the companies it oversees. Two of these regulations are the most important from a forex trader’s perspective. First and foremost, clients’ funds must be kept in the so called “segregated accounts”. This means, a FCA-regulated broker can not access your investment and “borrow” some of it for its own purposes. The second key ruling is the mandatory participation in the Financial Services Compensation Scheme (FSCS). This is a system, which operates similarly to an insurance company – in good times all brokers give a potion of their profits to a collective pool, which then serves to guarantee client’s interests, in case one of the brokers goes bankrupt. If you trade with an FCA-regulated company, and it happens to go insolvent, your account will be covered up to £50,000.
DomiFX is focused on the Chinese market, as some portions of their website suggest. Furthermore the company does not accept clients from the European Economic Area, USA, Japan, British Columbia, Saskatchewan and Iran.
Minimum Initial Deposit
DomiFX requires an initial deposit of at least $25. Although it should be obvious that no serious trading can be done with $25, this measure is applied in order to attract a bigger number of clients.
DomiFX isn’t alone in this practice by any means. For instance, you can open a new cent-account with FXTM, for as low as $5.
Average spreads & Commissions
The spreads which DomiFX claims to provide, on the company’s website are nothing short of excellent. However our testing, revealed a very different trading environment – spreads on the platform were starting from 2 pips. This is basically twice the initially announced value. The sheer fact there is a mismatch, at all is troubling, let alone its scale. On the other hand, you can always check the real-time spreads offered by some of the best forex brokers, which are available at our comparison page.
Leverage at DomiFX is capped at 1:100. This is basically the standard, or some will say even conservative level, when it comes to forex trading. The trend in the last several years has been of brokers offering more and more leverage. Some, even use it as a marketing tool, like XM, who offer a 1:888 leverage ratio (so catchy).
That being said, higher leverage inherently carries a bigger risk for your investment. This can lead to a quick and significant loss if you do not understand the risks involved completely.
DomiFX offers its services via MetaTrader4, the most popular forex platform in the world. It has earned the respect of many technical traders, as the charting it provides is top tier. Furthermore, the massive fan base has created multiple custom technical indicators and automated trading systems (Expert Advisors), some of which are available for free.
Other than the solid desktop offering, MetaTrader also provides a web version and mobile apps, available for both Android and iOS. The app is packed with most of the original platform’s functionality. In fact, it may be confusing for new traders, who are used to other, more simplified, trading solutions.
Methods of Payment
DomiFX only provides payments only via China UnionPay. This may be suitable for their main target market, but limits the possibility for traders from the rest of the world, as no options such as Paypal or even Credit Cards are available.
DomiFX Review Conclusion
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