Leveraged trading is defined as purchase and sale of foreign exchange, commodities, precious metals and other assets to be determined by the Capital Markets Board (CMB), with a specified leverage ratio, according to the regulation. Since leveraged trading is widely known as forex trading, “forex” will be used instead of “leveraged trading” in this document.

In order to offer forex trading, intermediary insti- tutions are required to hold the relevant license granted by the CMB. Only licensed brokerage firms and derivatives brokerage firms can provide forex transactions. Banks are not authorized to provide any type of brokerage services in forex.

Forex trading has been regulated by the CMB since 31 August 2011.


According to the regulations, intermediary institutions can be market makers, white labels or introducing brokers. These three types of activities are subject to different requirements.

  1. Market Makers can carry out leveraged transactions directly, accepting and/or executing orders submitted by investors. Only brokerage firms can be market and they are required to hold the securities trading and derivatives trading licenses.
  2. White Labels accept the orders as a representative of another institution and forward those orders to the main institution. Only brokerage firms can be white labels. Brokerage firms are able to either represent an authorized local institution or a foreign institution authorized by the relevant authority in its home country, according to legislation. However, representation of a foreign institution is not allowed currently,  due  to a resolution of the Capital Markets Board.
  3. Introducing Brokers promote the leveraged trading services of another institution, acting as its agent. They set up the contractual arrangement between the institution and investors. Both brokerage firms and derivative brokerage firms can be introducing brokers. On the other hand, introducing brokers can only promote the services of authorized local intermediaries. Representation of foreign institutions is not allowed currently.


Market makers should have an equity of at least ten times the minimum equity required for securities trading. On the other hand, white labels should have an equity at least three times the minimum equity required for securities trading.

Minimum Capital Requirements (2012)
Brokerage Firms


Securities Trading832,000460,559
Levmakerseraged FX Trading (Market Maker)8,320,0004,605,591
Leveraged FX Trading (White Label)2,496,0001,381,677
Leveraged FX Trading (Introducing Broker)--
Public Offering417,000230,833
Repo/Reverse Repo Agreements417,000230,833
Portfolio Management334,000184,888
Investment Consultancy87,00048,159
Margin Trading, Securities Lending and Short-Selling                     --
Derivatives Trading--
Total (Assuming Market Making in Forex)10,407,0005,760,864
Derivative Brokerage Firms
Trading in Currency and Precious Metal Derivatives911,000504,290
Trading in Commodity Derivatives911,000504,290
Trading in All Kinds of Derivatives1,820,0001,007,473
Source: CMB*Calculated asof June 2012

Additionally,  intermediary  institutions  should  fulfil detailed requirements regarding organizational structure, IT infrastructure, risk management, internal control, documentation, client relations and advertisements.


Licensed intermediaries must have a separate section on their web sites for leveraged transactions. This section must require_once;

    1. Information on the licenses held,
    2. General information about the main institution if the brokerage firm is White Label or Introducing Broker,
    3. Potential risks of leveraged trading,
    4. Information about the platforms used for the transactions, safety precautions, alternative communication methods, order execution processes and protection of personal information.

In addition, once every three months, brokerage firms must announce the ratio of the customers in the black to the ones in the red.


The full amount of the leverage used by the investor must be collateralized in cash, in Turkish Lira or a convertible currency.

The parties may freely determine the leverage ratio, but it cannot exceed 100:1. This means, the investor is required to deposit at least 1% of the total transaction value. For example, in order to trade USD 100,000, the required margin would be at least USD 1,000.

The legislation requires that margins deposited by investors should be kept at the ISE Settlement and Custody Bank (Takasbank).


Information on licensed brokerage firms is available on TCMAB’s web site. Furthermore, trading volumes and revenues of the brokerage firms on leveraged transactions are published quarterly. Please see “Brokerage Firms’ Comparative Data” on our web site, for details.


Communiqué Serial: V, No: 125 on Principles Regarding Leveraged Transactions and Institutions which are Authorized to Provide Those Transactions

Communiqués Serial: V, No: 123, Serial: V, No: 124 and Serial: V, No: 126 on the Communiqué Serial: V, No: 46 on Principles Regarding Intermediary Activities and Intermediary Institutions,

Communiqué Serial: V, No: 34 on Principles Regarding Capital and Capital Adequacy of the Brokerage Firms,

Communiqué Serial: V, No: 90 on Principles Regarding Establishment and Operation Conditions of the Derivatives Intermediary Institutions

Article 155 of Law No 6111 

Written by Gülçe Yumurtacı, Edited by Alparslan Budak and Ekin Fıkırkoca

August 2012

For online version please visit TCMA’s website at; www.tspakb.org.tr
Or click http://www.tspakb.org.tr/forex_trading_01082012.pdf


FX World Istanbul