Forex Trading in the US Virgin Islands

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Contributor, Benzinga
October 21, 2022

As a U.S. territory that uses the U.S. dollar as its currency, the U.S. Virgin Islands generally operates under the same well-established financial regulatory structure as the United States. Investors can park money in the territory to escape overbearing tax policies, and traders in the Islands can operate via online brokers that do not need to follow the strict rules in the Dodd-Franc Wall Street Act of 2010 that limits leverage ratios and imposes other restrictions on forex trading.

Although the Islands officially put U.S. restrictions on any local brokers, foreign brokers lacking those restrictions can offer their services to Islands residents. Brokers operating outside the U.S. are not limited in marketing to non-U.S. clients residing on the Islands, and even U.S. citizens there might want to take advantage of the opportunity to trade currency pairs with fewer restrictions and using higher leverage ratios.

Disclosure: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 68% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

Get Started with Forex in U.S. Virgin Islands

Retail forex trading has an unusually high risk of failure since most traders lose money. For the best chance to be profitable, you should take the time to create a sensible trading plan that incorporates an overall effective trading strategy and sound money management principles. While mastering forex trading can take a lifetime, you can follow the relatively simple steps outlined below to get started.

  1. Connect to the web. Unlike many other island locations, the U.S. Virgin Islands has regions where a decent internet connection is available. This connection is vital if you plan on using an online broker to trade through. 
  2. Get a fully regulated broker. Many forex brokers that have been scared away from operating in the U.S. by its strict regulatory environment will still accept clients from the U.S. Virgin Islands. Always beware of dealing with unregulated brokers that may be involved in fraud or other scams due to the risk of losing your margin deposit. Using a reputable online broker overseen by a good regulatory authority is generally the best bet. 
  3. Open a trading account. Once you have selected a regulated broker, browse through their account types to find the one that best suits your initial deposit amount and trading needs. Unless you just want to practice trading in a demo account, you will generally need to provide identifying information at this point to open a live trading account. 
  4. Fund your account. If you feel ready to start trading in a live account, you will need to add funds to it to trade forex on margin. Most online brokers will accept funds via bank wire transfers, debit card payments and electronic funds transfers from services like PayPal and Skrill. 
  5. Choose your trading platform. Depending on the broker you select, you may have the option of trading via more than one platform, including those proprietary to the broker and popular 3rd-party platforms like MetaTrader and cTrader. Choose a platform that is available on your device, has all the features you need and seems most intuitive to use. 
  6. Start trading forex. You can now start trading currency pairs from the U.S. Virgin Islands. 

U.S. Virgin Islands Forex Trading Strategies

Making sure you have a well regulated, connected and funded trading environment is only part of what you will need to trade forex successfully. Another key element is choosing the type of strategy you want to use to trade with. Mastering forex trading is typically much easier if you focus your efforts on using one of the trading blueprints described below.

Day Trading

The day trader is defined by their preference to close positions out by the end of the trading session to avoid taking overnight market risk. They typically need a decent internet connection and quick reflexes to take advantage of fleeting opportunities in the market. Day traders tend to use technical analysis to signal trading setups and often watch economic calendars to either take advantage of or avoid the notable volatility that can arise around key data or news releases. 

Swing Trading

The market fluctuations that swing traders aim to profit from are called swings. Swing traders typically do take overnight positions as they watch momentum indicators to inform them when a market is likely to reverse in direction so that they can position themselves accordingly.  Swing traders often need to be patient and flexible enough to move into or out of the market at the right moment when signals arise. Professional swing traders are typically masters at interpreting indicators and dealing calmly and systematically with market fluctuations. 

Position Trading

Position or trend traders often study long-term economic cycles and understand how the fundamentals of a currency will ultimately affect its value relative to other currencies. The more a currency’s relative value diverges from fundamental valuation measures like its purchasing power parity exchange rate, the more money a position trader can make by identifying such valuation discrepancies. However, it can be difficult to determine exactly when the market will correct itself, so a position trader may hold a position for months or even years before it actually produces the expected result. They also need to know when they are wrong on a trade and often use trailing stops to protect profits that have accrued on a position.

Forex Trading Example in U.S. Virgin Islands

Since the currency used in the U.S. Virgin Islands is the U.S. dollar (USD), those living there can easily find online brokers that offer plenty of currency pairs to trade involving that major currency. 

As a forex trading example, perhaps you thought the U.S. dollar was going to rise from its current 106.00/05 level versus the Japanese yen. You could enter an order with your broker to buy $100,000 at 106.05. If the broker allows you to use a leverage ratio of 100 to 1, that means you need at least $1,000 deposited in your trading account as margin to control a position of that size.  

After 9 hours, USD/JPY is now trading at 106.25/30. This favorable move of 20 pips results in a profit of ($100,000 x 0.25) or 25,000 yen, which can be sold to buy $235.18 at 106.30. Had the market fallen by 20 pips instead, you would have lost 25,000 yen if you closed out the position at that point.

Making Money with Forex in U.S. Virgin Islands

After you’ve chosen a trading strategy type, explore some additional strategies and trading vehicles to use when trading forex. Here are some of the most common that might interest forex traders.

  • Going short: When you sell the base currency and buy the counter currency to initiate a position in a currency pair to take advantage of an expected decline in its exchange rate, you have sold or “gone short” that pair. If you do the opposite, you have “gone long” the pair to express a bullish view on its exchange rate.  
  • CFDs: Contracts for difference are agreements used in place of making a transaction in their underlying asset. CFDs are settled in cash based upon where they are initiated and then closed out at the prevailing market, and their value tracks that of the underlying asset. CFDs can be used to trade a wide variety of assets online, including forex pairs, stocks, indexes and commodities. 
  • Binary options: Exotic derivative contracts that let the holder pay a fixed premium in order to receive a fixed payoff if a specific market condition occurs at or before expiration. 

Best Online Forex Brokers in U.S. Virgin Islands

Any forex brokers based in the U.S. Virgin Islands should be licensed and regulated by the National Futures Association (NFA) and the Commodity Futures Trading Commission (CFTC). Many other online brokers are also suitably regulated in their local jurisdictions. Always choose a reputable and well-regulated broker to deal through when trading forex online. 

    Best For:
    Forex Trading in and Outside the U.S.
    securely through's website

    CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 68% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

    The products and services available to you at will depend on your location and on which of its regulated entities holds your account

  • IG Markets
    Best For:
    Forex Execution
    securely through IG Markets's website

    Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when trading spread bets and CFDs with this provider. You should consider whether you understand how spread bets and CFDs work, and whether you can afford to take the high risk of losing your money.

  • Interactive Brokers
    Best For:
    Active and Global Traders
    Securely through Interactive Brokers’ website
  • HotForex
    Best For:
    Investing in CFDs
    securely through HotForex's website
  • eToro Forex
    Best For:
    Copy Trading
    securely through eToro Forex's website

    CFD trading is not available to U.S. users. 76% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money.

  • OctaFX
    Best For:
    Trading in the App
    securely through OctaFX's website
  • FXTM Review
    Best For:
    Copy Traders
    securely through FXTM Review's website

The U.S. Virgin Islands Gives Forex Traders Options

Trading forex from the U.S. Virgin Islands gives traders a very interesting choice — you can either operate under a strict U.S. regulatory structure with tight restrictions on leverage or opt out of that if you want to use additional leverage. If you’re seriously considering trading currencies, you will also want to make sure you develop a good trading plan that incorporates sound money management principles and a trading strategy that shows attractive profitability levels. 


Can anyone trade Forex in the US Virgin Islands?


Yes, anyone can trade Forex in the U.S. Virgin Islands and the jurisdictions has various regulations depending on where the trader is located.


Is it safe to trade Forex in the US Virgin Islands?


It is safe to trade Forex in the US Virgin Islands as long as you use a reputable local or foreign broker.


How do I find a reputable broker to trade Forex in the US Virgin Islands?


To find a reputable broker in the US Virgin Islands, consult the list above.

Bookmark this page for relevant information that could affect your forex trading from the U.S. Virgin Islands.

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