It’s commonly believed that regulated brokers never offer high leverage — that if a broker is properly licensed, it will limit leverage to extremely low levels like 30:1 or less. While it’s true that regulations in some jurisdictions cap leverage for retail traders, the idea that all regulated brokers avoid high leverage is a myth. In fact, many regulated brokers operate under multiple entities across different regulatory environments, offering both low and high leverage — depending on your location, account type, and risk profile.

This article explains how leverage is regulated, when high leverage is legally offered, and how to choose the right broker structure for your needs.

Why this myth exists

1. ESMA and ASIC leverage caps
In the EU and UK (via ESMA and the FCA) and Australia (via ASIC), retail clients are limited to 30:1 on majors, and even less on minors and commodities. This strict regulation leads traders to believe all brokers must follow the same limits.

2. Confusion between regulation and protection
Many assume that high leverage = scam, and low leverage = safe. But regulation is about licensing, transparency, and fund security — not just leverage ratios.

3. Lack of awareness about global broker structures
Most brokers have multiple entities — one under tight regulation (like FCA) and another in a jurisdiction that allows higher leverage (like Seychelles, Mauritius, or St. Vincent).

4. Misinterpretation of risk management
Some traders believe regulated brokers are “not allowed” to offer high leverage — when in fact, they simply segregate retail and pro accounts under different conditions.

The truth: regulated brokers can offer high leverage

1. Dual-entity models are common

Reputable brokers often operate under two or more licenses:

• FCA/ASIC/CySEC – regulated, lower leverage (30:1 for retail)
• FSA (Seychelles), FSC (Mauritius), VFSC, SCB – regulated but offer 100:1 to 500:1 or more

Example:
A broker may offer 30:1 under its FCA arm, but 500:1 under its offshore entity — both regulated in their respective jurisdictions.

2. Professional clients can access higher leverage

In the UK, EU, and Australia, if you qualify as a professional client (e.g. trading experience, portfolio size), you can access up to 400:1 leverage with a regulated broker — even under FCA or ASIC.

3. Offshore regulators still issue real licences

Jurisdictions like Seychelles, Bahamas, or Mauritius are not “unregulated.” They have licensing bodies, compliance requirements, and anti-money laundering laws — though typically looser than Tier 1 regimes.

4. High leverage doesn’t mean no protection

Some offshore brokers still offer:

• Negative balance protection
• Segregated client accounts
• Transparent execution
• Tiered account types with adjustable leverage

When to be cautious

• Avoid brokers that offer high leverage without any regulatory licence — especially if they refuse to disclose their legal entity
• Be wary of platforms that offer unrealistic bonuses or guaranteed profits — red flags of shady operations
• Check if the broker has clear risk disclosures, withdrawal policies, and client fund segregation

How to access high leverage safely

• Use a broker with both regulated and offshore entities — choose the one aligned with your risk appetite
• Register under the offshore entity knowingly — not accidentally via an affiliate
• Use lower leverage by choice even if higher is available — controlling risk is key
• Verify the broker’s regulatory number directly on the regulator’s official site

Conclusion

No — regulated brokers can offer high leverage. The difference lies in which regulator the broker operates under, and how the accounts are classified. Tier 1 jurisdictions limit leverage to protect retail traders, but offshore entities offer flexibility — often under legitimate regulation. The key is knowing the difference between high leverage and high risk — and choosing brokers that offer both trust and control.

To learn how to navigate global broker structures, assess risk properly, and trade with leverage intelligently, enrol in our Trading Courses at Traders MBA — where regulation meets opportunity, and risk is your tool, not your threat.