Japan Financial Services Agency (FSA) Brokers 2023
This guide lists the top brokers regulated by the Japanese Financial Services Agency (JFSA), which is responsible for protecting market participants and the stability of the local financial system. We also explain the history of the agency, its responsibilities and protections for retail traders.
Best JFSA Brokers
These are the 3 top brokers that hold a license with the JFSA, providing a secure trading environment for Japanese traders:
#1 - ThinkMarkets
ThinkMarkets is a reputable CFD and forex broker with regulation from several top-tier bodies including the FCA and ASIC. Traders can use a bespoke platform, MT4 or MT5 to access a wide variety of assets including 3500+ stocks and ETFs, 46 forex pairs and over 20 cryptocurrencies. Fees are competitive, particularly for the ThinkZero account with spreads starting at zero.
"ThinkMarkets is a reliable, multi-regulated broker that will suit most CFD traders thanks to its large asset list, competitive fees and excellent platform options."- DayTrading Review Team
- Instruments: CFDs, Forex, Stocks, ETFs, Futures, Commodities, Crypto, Spread Betting (UK Only)
- Regulator: FCA, ASIC, CySEC, FSCA, JFSA, FSA Seychelles
- Platforms: ThinkTrader, MT4, MT5, AutoChartist, TradingCentral
- Min. Deposit: $0
- Min. Trade: 0.01 Lots
- Leverage: 1:500
ThinkMarkets offers CFDs on a good range of instruments, the most extensive being stocks and ETFs with 3500+ assets, as well as indices and commodities, amongst others. Leverage is available up to 1:30 in the EU and UK, while clients of the offshore branch can access up to 1:500 leverage.
ThinkMarkets offers 46 forex pairs, including a decent variety of minors and exotics as well the majors. Forex traders also benefit from very tight spreads starting from 0.0 pips for the EUR/USD in the Zero account.
ThinkMarkets clients can trade CFDs on an impressive list of more than 3000 shares with low commissions and no hidden fees, plus fast execution speeds. The broker does not support trading of physical company shares.
With 20+ cryptocurrencies available to trade via CFDs, traders can securely speculate on crypto markets with up to 1:10 leverage. ThinkMarkets does not directly trade crypto assets, meaning you will not own the tokens, and crypto trading is not available in some jurisdictions.
- Three stable and award-winning platforms plus seamless integration with the broker's Signal Centre
- In-depth educational resources for beginner, intermediate and advanced level traders, plus live webinars
- Reliable 24/7 multilingual support via telephone, email or live chat
- $500 minimum deposit for ThinkZero account
- Limited bonus offers, refer-a-friend schemes or trading competitions
- Not many payment methods available for UK traders
#2 - Dukascopy
Dukascopy is an online broker operated by a Swiss-regulated banking group. It offers a good selection of 500+ markets, with forex, stocks, gold, ETFs, indices, bonds and cryptocurrencies available. It also offers flexible trading opportunities through the choice of CFDs or binary options. Traders will use MetaTrader 4 or a proprietary platform that is well-suited to automated trading.
"Dukascopy will appeal to active day traders with fee rebates and the JForex platform for automated trading."- DayTrading Review Team
- Instruments: Forex, CFDs, indices, shares, commodities, metals, cryptocurrencies, bonds, binary options
- Regulator: FINMA, FCMC, JFSA
- Platforms: MT4, AlgoTrader
- Min. Deposit: $100
- Min. Trade: 0.01 Lots
- Leverage: 1:200
Dukascopy offers highly leveraged CFDs with rates up to 1:200. A wide selection of asset classes are available, including currencies, equities, commodities, ETFs and cryptos. Spreads are also tight starting from 0.1 pips and traders get 24/7 support.
With 60+ currency pairs available, Dukascopy offers enough majors, minors and exotics to keep most forex traders happy. The broker also offers high leverage up to 1:100 – a good amount to see from a reputable and regulated broker. Currency traders have access to excellent software, including MT4 and JForex.
Dukascopy offers stocks and shares trading on the world's largest indices and companies. Users have access to North America, Europe and the Pacific region with competitive pricing. The broker's market research, including its technical and fundamental analysis, trading ideas and TV channel, are standout features for us.
Take positions on popular cryptos against the US Dollar. Traders can go long or short with decent leverage up to 1:5. Clients of Dukascopy are also protected to the tune of CHF 100'000 in the event of broker insolvency.
- Full range of investments including cryptos
- Low minimum deposit of $100
- Heavily regulated brokerage including oversight from Swiss FINMA
- Time-consuming registration process
- No Islamic trading account
#3 - Alpari
Alpari is an offshore multi-asset broker that offers traders a wide range of forex trading opportunities as well as stock, index and commodity CFDs. The broker's fix contracts also offer fixed costs with payouts known upfront. Trading takes place on the MetaTrader 4 and MetaTrader 5 platforms, plus the brand's mobile app. Alpari offers tight spreads on ECN accounts and commission-free spreads from 1.2 pips on standard accounts.
"Alpari will suit short-term binary options traders with a low $5 deposit and welcome bonus. Forex traders also get very high leverage with tight spreads while the broker's PAMM service will appeal to hands-off investors."- DayTrading Review Team
- Instruments: CFD, Forex, Stocks, Crypto, Commodities
- Regulator: FSC, SEBI, JFSA
- Platforms: MT4
- Min. Deposit: $5
- Min. Trade: 0.01 Lots
- Leverage: 1:400
Alpari offers CFDs on 60+ forex pairs, hundreds of global stocks, 11 stocks indices and spot metals and energies. Trading takes place via the MT4 or MT5 platforms, and the broker provides strategy and copy trading support as well as educational resources and 24/5 multilingual customer service.
Alpari traders can access 60+ currency pairs and crosses via CFDs on the MT4 and MT5 platforms. The broker offers very competitive pricing, especially on the ECN Pro account which is commission free. Significant leverage up to 1:1000 is available.
Alpari traders can speculate on the price movements of hundreds of global shares and 21 indices through highly leveraged CFDs. Leading blue-chip stocks are available including Microsoft, Alibaba and Apple, while major indices include the SPX500 and UK100.
Alpari offers a solid selection of popular crypto tokens paired with the USD. Spreads are competitive, starting at 1 and users can analyze the digital asset markets with the leading MetaTrader platforms, including on the weekends.
- 20+ years track record
- Welcome bonus for new traders
- Supports MT4 and MT5 platforms
- High charges for strategy manager copy trading tools
- Weak market research and analysis tools
- Not available in the US
What Is The Japanese Financial Services Agency?
The Japanese Financial Services Agency became a regulatory body in 2000 and is the main watchdog in the region. It is based in Tokyo and led by a Commissioner who is appointed by the Minister of State for Financial Services.
The decisions the Japanese Financial Services Agency makes in relation to securities trading has implications for both traders and online brokers. Importantly, any broker or company providing trading services to retail investors must hold a license with the JFSA. Traders can use the online register to search for FSA-regulated entities and companies.
The local watchdog is also a member of the Financial Action Task Force (FATF). This is an international organisation set up to develop global standards for anti-money laundering. As a result, the JFSA’s influence extends beyond Japan.
Responsibilities & Powers
To understand the responsibilities and powers of the Financial Services Agency in Japan, you have to first know its structure. The FSA is split into several bureaus:
- Strategy Development and Management – this function implements policies
- Policy and Markets – rather than implementing the policy, this bureau makes the policy for markets and the wider financial system (e.g rules regarding liquidity risk management)
- Supervision – this bureau has responsibility, amongst other things, for monitoring the local cryptocurrency industry
- Securities and Exchange Surveillance Commission Executive – this is the enforcement wing of the JFSA
- Certified Public Accountants and Auditing Oversight Board Executive – this has the role of conducting audits
The Japanese Financial Services Agency also has some regulatory reporting powers to increase transparency in business activities and to assist itself in enforcing its rules. In addition, the JFSA works closely with the Government of Japan to develop legislation that impacts the local financial system and the firms within it.
An example of regulations to be introduced in the future is the mandatory requirement for climate risk disclosures for certain large companies. This move is to align with the objectives of the Task Force for Climate-Related Financial Disclosure (TCFD).
Investors Protection Fund
The JFSA also plays a role in insuring client funds. Trading brokers should segregate client accounts from their own capital. In theory, this means customers should still be able to withdraw their funds if a firm goes bankrupt. However, should this not happen, the JFSA has an Investors Protection Fund that will pay a maximum of 10 million yen per investor.
The Securities and Exchange Surveillance Commission (SESC) in Japan comes under the authority of the JFSA. It helps undertake investigations into market misconduct and inspects financial business operators. In the case of serious violations, it can make recommendations to the Financial Services Agency and the Japanese Prime Minister to take administrative disciplinary action.
The remit of the JFSA’s enforcement powers are extensive – the regulator can impose fines, order the cessation of corporate operations and even imprison guilty individuals. Japan’s Financial Services Agency has a weekly review, which contains a list of any administrative penalties issued against companies in the preceding week.
The Financial Services Agency in Japan has taken a robust approach to the crypto industry. Following token thefts at the Coincheck exchange in 2018, two brands were ordered to shut down whilst legislations were adjusted. In 2019, rules that applied to crypto exchanges were also strengthened to help ensure that customer assets were adequately protected.
New restrictions on stablecoins have also been discussed, with the Japanese Financial Services Agency planning to introduce fresh requirements in 2022. The restrictions may state that only banks and wire transfer services can issue stablecoins. The US has also been thinking along similar lines. It is hoped that these restrictions will provide additional protections to local financial markets, however, they are likely to impact the availability of stablecoins to crypto investors.
In the forex market, the Japanese Financial Services Agency imposes a maximum leverage cap of 1:25. This means that investors cannot trade with more than 25 times their original investment. Regulations like this help protect traders from magnified losses, however, they can also restrict traders who want to adopt high-risk strategies.
Remember that while the JFSA imposes maximum leverage restrictions, brokers can still reduce margin ratios further – they just cannot exceed the maximum cap.
Another area that the JFSA has cracked down on is advertisements that exaggerate the services or opportunities available. The regulator also regularly interviews forex brokers to ensure they interact with their customers appropriately.
Other Markets & Trading Types
The Japanese Financial Services Agency/Council has looked at streamlining the Tokyo Stock Exchange and reducing the number of companies in one of the cash equity markets. This would impact traders speculating on the growth of that market.
In addition, back in 2002, the JFSA strengthened short-selling restrictions to try and prevent unfair transactions. There have also been further developments since then, including restrictions on naked short selling (i.e selling stocks that do not exist).
Final Thoughts on JFSA Brokers
Being the chief regulator of the Japanese financial services industry, the remit of the FSA extends beyond online trading. With that said, many of the policies and regulations it devises have direct implications for traders. This can be seen in the action it has taken with cryptocurrency exchanges plus leverage in the retail forex trading space. See our list of the best JFSA brokers to get started today.
What Is The JFSA?
The JFSA is the Financial Services Agency of Japan and the main regulator of local financial services. It creates regulations and rules governing financial companies, such as trading brokers. It also enforces its requirements and standards. Note, a licensed entity search is available on its online register.
Is The Japanese FSA Tough On Cryptocurrency?
The JFSA has taken robust action to protect crypto traders, for example, tightening the rules following coin thefts from exchanges in 2018. With that said, their requirements are similar to those of many global regulators who are also taking a tougher stance in the digital currency space.
What Is The JFSA Investors Protection Fund?
The Investors Protection Fund secures the capital of investors should a licensed firm go bankrupt. It will pay a maximum of 10 million yen per investor in the event that a securities company goes bankrupt.
What Enforcement Powers Does The Japan FSA Have?
The JFSA has powers to issue fines, imprison individuals and order the cessation of corporate activities. Its powers and responsibilities are in line with other top regulators like the UK’s Financial Conduct Authority.
What Is The Maximum Forex Leverage That The JSFA Allows?
The JFSA imposes a maximum leverage rate of 1:25 for retail forex traders. These rules are relatively stringent so many brokers are registered with other, more relaxed regulators.