Beware! This is an offshore broker! Your investment may be at risk.
RECOMMENDED FOREX BROKERS
Don’t put all your eggs in one basket. Open trading accounts with at least two brokers.
HBCBroker offers forex and CFD trading to its clients. You may be wondering if you should invest your trading capital with them? In this review we will tell you five things you need to know before investing with them.
1. Will your money be safe at HBCBroker?
HBCBroker is owned by MPG Invest Limited. The company is registered in Vanuatu and is licensed by the local VFSC. We generally don’t recommend dealing with off-shore companies as they may not be regulated as strictly, as you desire.
As you may know, financial regulators are state entities which impose rules on companies in order to protect the interest of their clients. For instance, the popular Cyprus Securities and Exchange Commission (CySEC) has certain conditions which a broker must fulfill, in order to receive a license. One of them is the mandatory participation in a compensation scheme – a procedure by which the company sets aside a portion of its profits in order to guarantee clients’ funds, in case the broker goes bankrupt. All accounts with CySEC regulated brokers are guaranteed up to EUR 20,000. This is something which you will not get with an off-shore broker.
Vanuatu’s VFSC only requires $2,000 for a company in order to register it as a broker. HBCBroker may be a legitimate company, but this regulation is not enough to confirm that.
2. What are the different account types?
HBCBroker offers three account types, based on a client’s initial investment. The accounts are as follows:
|Account type||Minimum deposit||Maximum leverage||Spread|
|Silver||$250||1:400||Variable, starting at 1.8 pips|
3. What are the trading conditions?
As you can see from the previous table, HBCBroker offers high leverage – 1:400. That is in line with the current industry standard. Keep in mind that high leverage carries higher risk for your trading capital. That is why some regulators have imposed much lower limits on leverage levels – the US National Futures Assotiation has capped it at 1:50.
HBCBroker claims they offer variable spreads, starting at 1.8 pips for EUR/USD. Our test of their platform showed vastly different conditions – a fixed spread of 3 pips for EUR/USD. This is not competitive with today’s standards, as most fixed spread brokers offer around 2 pips for the pair. On the other hand floating spread broker offer even better conditions. The current average floating spread on this pair is somewhere in the 1.0-1.5 pips range.
The company offers a lot of trading instruments. They range from currency pairs, to CFDs on metals, commodities, indices and even a few stocks. This may be considered an advantage, but it doesn’t serve much purpose with the high spreads.
4. What platforms are being offered?
The company offers MetaTrader4 to its clients. The platform has proven itself over the years, as traders enjoy its simplicity. With solid charting capabilities and support of automated systems (Expert Advisors or EAs), the platform has won fans around the world.
Some experienced traders dislike the lack of detachable modules, which limits the ability to support multiple monitors.
5. What are the deposit and withdrawal methods?
HBCBroker offers a lot of payment options. They include:
- Bank Transfer;
- Credit/Debit Card;
HBCBroker is a forex broker, regulated in Vanuatu. This does not inspire a lot of trust. It is better than no regulation, but not quite the same as being licensed by a more stringent watchdog. However regulation is not the main issue with the broker – the trading conditions are unattractive. With a 3 pips fixed spread on the most liquid currency pair HBCBroker should not be on your radar. Even if the broker is not a scam, you can find much better conditions elsewhere.