fxpesa.com in short
FXPesa is a trade name of EGM Securities Limited, which is licensed by the Capital Markets Authority in Kenya. FXPesa claims to be the first brokerage that offers CFD products for the retail market in East Africa. FXPesa also informs that it maintains a high level of internal and external compliance standards. Currency pairs, indices, commodities, and shares are available for online trading through the company’s own terminal, as well as through the well-known MetaTrader 4 (MT4) platform. FXPesa uses market execution of customer’s orders through a Non-Dealing Desk (NDD) model. Spreads are floating and you can start trading by investing USD5.
Checking the company’s regulation is one of the important steps you need to take before doing anything else. FXPesa is the trading name of EGM Securities Limited, which is regulated and authorized by the Capital Markets Authority in Kenya. The register number is PVT-AAAAFF7 and the license number is 107. All client money is held in segregated bank accounts and does not form part of the company’s assets or funds. All card transactions are processed by Equiti Capital UK Limited.
There are two types of live trading accounts that differ in the required initial deposit amount and the offered spreads and commissions.
Executive Account – This account allows you to start trading with a minimum deposit of USD5. You will receive a 30% cash bonus but up to USD150. The typical spread for the EUR/USD pair is 1.4 pips. The maximum leverage is 1:400 for currency pairs and precious metals, 1:200 for indices and 1:20 for shares. You will be charged a USD10 commission per 1 standard lot traded CFDs on futures of indices and 0.02% on CFDs on shares.
Premiere Account – This account allows you to trade with raw spreads (close to zero) at the expense of some commission and you must invest at least USD100 to open it. You will receive a 30% cash bonus but up to USD150. The typical spread for the EUR/USD pair is 0 pips and the commission you must pay is USD7 per standard lot traded of currency pairs and precious metals. The maximum leverage is 1:400 for currency pairs and precious metals, 1:200 for indices and 1:20 for shares. You will be charged a USD10 commission per 1 standard lot traded CFDs on futures of indices and 0.02% on CFDs on shares.
What Type of Brokerage the Company is?
The company provides the Business to Client Agreement and General Terms and Conditions document in the Legal Documentation section of the website. This file is going to show what type of brokerage the company is. The Introduction paragraph informs that FXPesa will deal with clients as principal, or it is a counterparty to each deal, acting as a market maker. The Conflict-of-Interest paragraph shows that the company may match your order with that of another by acting as his behalf as well as yours. It can also buy from you and immediately sell to another customer and vice versa. In other words, when a company acts as a market maker, it may not hedge the risk, hoping that every loss for customers is a profit for the company; therefore, the conflict of interest exists.
The Risk Warning Disclosure file informs that placing a stop-loss order will not necessarily limit your losses to the intended amounts, because market conditions may make it impossible to execute such an order at the stipulated price. These orders do not guarantee that the execution price will be the same as the requested price (which depends on the available liquidity), especially in market gaps or fast-moving markets. This means that all types of orders are subject to slippage and stop loss orders are not guaranteed. They will be fulfilled at the next available market price.
The same document warns that even a small movement in price against you can lead to substantial losses including potentially losing more than the money placed on deposit. This means that retail clients are not covered by Negative Balance Protection and in the end you may owe money to this company.
There are general fees that customers pay during trading, such as spread, swap and rollover. In addition, there also is an inactivity fee. After 180 calendar days of no activity, your account will be classified as inactive. Activity is related to opening and closing of trades or maintaining an open position in your account. Then the company may apply a monthly inactivity fee equivalent to Secured Overnight Financing Rate (SOFR) 30-day rate for the current calendar month plus 3 basis points. Accounts that remain dormant for 12 consecutive months will be closed and any balances therein (if any) sent to the Unclaimed Financial Assets Authority.
Deposits and Withdrawals
Customers can use several deposit methods such as bank transfer, credit/debit cards, e-Wallet (Skrill and Neteller) and mobile payments. Some methods are instant such as credit/debit cards, and e-wallets, while bank transfers usually take longer (up to 3 working days).
Withdrawals can only be made to the same source of deposit, in cases where funding has been made using both card and bank transfers, card sources will be given priority when withdrawals are processed. Withdrawal requests submitted up until 3PM EST will be processed during the same business day, but the arrival time usually is longer and depends on the withdrawal method.
The company claims that no fees will be charged for making deposits. However, there may be charges incurred by customers’ own personal bank and debit/credit card providers, and mobile money service providers.
You can trade via one of the most popular terminals – MetaTrader 4 (MT4). MT4 is a modern and powerful trading platform that has an intuitive interface and a wide range of advanced features. It offers a robust and stable environment with multiple features that ease the process of trading. MT4 provides 9 different timeframes and more than 60 tools for analysis. You can automate your trading and safely test your strategies. The terminal is available as a desktop version and as mobile app for iOS and Android tablets and smartphones.
In addition, the company has developed its own platform entitled FXPesa Trader. It is web based and you have instant access to your trading account without having to install anything. You can use numerous easy to use technical indicators and drawing tools. There is an account management portal called myFXPesa, which can be accessed from FXPesa Trader and FXPesa Mobile platforms. You can fund your account through your preferred payment providers, access trading statements and manage account settings from this portal.
Forex – 68 major, minor, and exotic currency pairs are available for trading. The typical spread for the EUR/USD pair is 1.4 pips and the leverage is up to 1:400. Some of the currency pairs have different leverage such as 1:33 and 1:40.
Indices – CFDs on 16 of the world most traded indices are available including DAX, Dow Jones Industrial Average (DJIA) and FTSE 100. The typical spread for DJIA and DAX30 is 20 points. The spread for the EUR/USD pair is 1 point.
Commodities – 5 of the most traded commodities can be traded as CFDs including Gold, Silver, Crude Oil, and Brent Oil. The typical spread for the Gold is USD0.34 and it is USD0.028 for Crude Oil.
Shares – FXPesa offers more than 160 CFDs on US, European and UK shares such as Apple, Alphabet, Amazon, etc.
There is an educational section where you can register for free online trading courses, watch forex videos, or check the explained forex glossary. There is also a news section, but it is not up to date.
FXPesa is a trade name of EGM Securities Limited, which is licensed by the Capital Markets Authority in Kenya. According to the legal documents, the company may act as a market maker on its own discretion, so the main conflict of interest exists. The company provides a wide range of trading instruments via the most popular trading terminal MT4 and its own terminal called FXPesa Trader. There are two types of real accounts that differ in spreads and commissions. Deposits and withdrawals are processed free of fees, but all fees of intermediary banks are covered by you. You can start trading by investing just USD5.