Licensing

The agency responsible for the commodities futures market in the United States is the Commodities Futures Trading Commission (CFTC). The CFTC has delegated some responsibilities to the National Futures Association (NFA) a SRO. A candidate must pass a timed examination and obtain approval from the NFA to become a registered futures/commodities broker.

Agricultural Commodities

Financial and Index Futures

Financial futures and index contracts can also be bought and sold through your futures/commodity broker. The financial futures contracts are typically designed for the delivery of a financial product in a specified quantity on a specified future date. An investor may want to lock in the price of a financial product if it’s anticipated it will cost more in a future date in which funds would be available for investment. There are many financial futures contracts and some involve the delivery of such securities, including Treasury Bills and Certificate of Deposit (CD’s). Investors and money managers will also purchase index futures contracts. These contracts do not involve the delivery of any financial security but instead settle in cash based on the performance of the underlying index.

Foreign Currency

References

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