NIBA - Celebrating 35 Years

NIBA Journal

Insights, analysis, and updates from the National Introducing Brokers Association

Housekeeping
4 min read

HOUSEKEEPING, REMINDERS AND UPDATES

NATIONAL FUTURES ASSOCIATION CPO and CTA Quarterly Reporting Requirements for Period Ending March 31, 2016 Each commodity pool operator (“CPO”) Member and commodity trading advisor (“CTA”) Member with reporting requirements under Commodity Futures Trading Commission (“CFTC”) Regulation 4.27 is required to comply with National Futures Association (“NFA”) quarterly reporting requirements. NFA Compliance Rule 2-46 imposes quarterly reporting requirements on CPOs operating commodity pools and on CTA that direct trading of commodity trading interests. The CTA quarterly report (“Form CPR”) is used to collect general information about the reporting CTA and its trading program(s). For the period ending March 31, 2016, CTAs are required to submit Form CPR by Monday, May 16, 2016. A CPO must report specific information about the firm and the pools it operates on the CPO quarterly report (“Form PQR”). For the period ending March 31, 2016, CPOs are required to submit Form PQR by Tuesday, May...

By NIBARead article
3 min read

Ask the NFA

As your industry advocate, the NIBA provides many services which help your business stay in compliance with NFA regulations. "Ask the NFA," is the way you can ask questions about those regulations and compliance requirements without having to call NFA directly. Just email us at nfacomments@theniba.com and we will get the answers for you. Please keep in mind the purpose of this contact is to keep the lines of communication between NFA and NIBA members open, not to fix any specific individual concerns. This month's questions were selected from those submitted by NIBA members. The answers were supplied by NFA staff. "If I restructure my corporation i.e. change from LLC to S-Corp, does that require re-registration with NFA or is there a simple process to update company info on website?" Newly created companies, sole proprietors becoming corporations, or corporations becoming sole proprietors need to register. If you restructure an existing...

By NIBARead article
Member Announcements
2 min read

April Chairman’s Letter

Dear Members - On March 1, 2016, the NFA’s Cybersecurity Interpretive Notice became effective. It requires NFA Member firms to adopt and enforce written policies and procedures to secure customer data and access to their electronic systems. The notice applies to all membership categories including IBs, CTAs, CPOs, swap dealers and forex dealers. During the past month and a half I’ve had several discussions with IBs and CTAs who were not aware of their obligations under this Notice, and what actions were needed in order to remain in compliance as NFA Members. On April 20, NIBA will host a panel discussion focused on the key areas of the Interpretive Notice including a description of the safeguards against identified system threats and vulnerabilities, and a description of your firm’s ongoing education and training related to information systems security for all appropriate personnel. I strongly urge you to attend this session presented...

By NIBARead article
Member Announcements
2 min read

Celebrate CFTC SmartCheck Week

Celebrate SmartCheck WeekSM with us, April 11?17, by following us at our new U.S. Commodity Futures Trading Commission (CFTC) SmartCheck pages on Facebook and Twitter. SmartCheck Week is an effort to encourage all consumers to check the background of their financial professional at least once a year. The CFTC?s Office of Consumer Outreach encourages you to promote this week to your audience through social media, newsletters, and email. Templates for these communication methods are below and available for your use. Through these channels, we look forward to increasing contact with you and striving to improve investors? financial health. Everyone benefits when investors are more informed and that begins when they work with a legitimate financial professional. Social Media Resources Use these sample social media posts to promote SmartCheck Week to your network: Sample tweets. (Please use related hashtags): Have you checked the background of your financial professional lately? Do it...

By NIBARead article
Member Announcements
1 min read

Changing Ownership of Crude Futures Open Interest/Status of Barrel Ownership- NYC Session Preview

Over the last 6 years the crude oil market has had a material change in market structure.The changing landscape of regulation, capital requirements and the withdraw of participation by certain market participants has changed the open interest formation. Open interest has basically double in this period while volumes have remain relatively unchanged. With the shift of the geographic demand to Asia across all commodities , it is interesting to note some of the uniqueness of Asia demand. The other feature of the market is the dramatic change in the forward curve.$100 crude had a backwardation of $20, now we live in the steep contango market and storage availability has become a focal point. The vast majority of volatility has been in the front end of the curve. The distant dates have also had a major shift. As a former commodity merchant , the commercial trade always believes the real story...

By NIBARead article
Member Announcements
3 min read

Oil and Gas: All Stored Up with Nowhere to Go - NYC Session Preview

At What Price will Crude Futures End 2016? Current forecasts for the end-year price level for US crude oil are in sharp disagreement, as market observers’ debate the effect of record high oil inventories, strong demand, and the impact sharp cuts to capital expenditures for drilling and expected energy company bankruptcies will have on new production. Price volatility for West Texas Intermediate futures on the New York Mercantile Exchange was high in the first quarter, with market participants whipsawed with a price plunge to a $26.05 bbl nearly 13-year low before rallying 61% to $41.90 five weeks later. Sentiment turned bullish as Saudi Arabia and Russia floated a proposal to freeze production at their January output rate even though analysts poked holes in their plan, highlighted by a production ramp up by Iran. Iran had just won relief from sanctions on its crude exports in January, and is determined to...

By NIBARead article
4 min read

The How, Why and When of Selecting a Fund Auditor

How or when to select or change a fund audit firm for your hedge fund, CTA or other alternative investment business can seem like a daunting decision for any fund manager. However, it can be done with the right considerations and processes in place. WHEN TO SELECT A FUND AUDITOR Many fund managers are under the assumption that since fund audits are typically performed at year end that they don’t need to search for a fund auditor until much later. However, it’s actually in a fund managers’ best interest to select their fund auditor as soon as a fund is launched (or before) – for many reasons: It is very important for a newly launched fund to partner with an auditor who will help guide the firm through the crucial start-up stage. If you’re thinking about switching fund auditors, your fund auditor can review what has been done and the...

By NIBARead article
5 min read

NIBA CFTC Comment Letter

March 16, 2016 Mr. Christopher J. Kirkpatrick Secretary of the Commission Commodity Futures Trading Commission Three LaFayette Centre, 1155 21st Street, NW Washington, DC 20581 RE: Proposed Rulemaking on Regulation Automated Trading (“Reg AT”) RIN 3038-AD52 VIA ELECTRONIC SUBMISSION Mr. Kirkpatrick: NIBA appreciates the opportunity to comment on the Commodity Futures Trading Commission’s (“Commission” or “CFTC”) proposed rulemaking on Regulation Automated Trading (“Reg AT”). Founded in 1991, NIBA is a trade association of registered derivatives professionals whose members include Introducing Brokers (“IBs”), Commodity Trading Advisors (“CTAs”) and Associated Persons. Our members handle transactions for customers in the futures, options, forex and swaps markets. The mission of the NIBA is to provide education which helps our members grow their businesses while staying in compliance, and to provide a forum for their opinions. We have the support of ten futures commission merchants (“FCMs”), various exchanges and trading platforms, and a solid, long-term...

By NIBARead article
3 min read

Ask the NFA

As your industry advocate, the NIBA provides many services which help your business stay in compliance with NFA regulations. "Ask the NFA," is the way you can ask questions about those regulations and compliance requirements without having to call NFA directly. Just email us at nfacomments@theniba.com and we will get the answers for you. Please keep in mind the purpose of this contact is to keep the lines of communication between NFA and NIBA members open, not to fix any specific individual concerns. This month's questions were selected from those submitted by NIBA members. The answers were supplied by NFA staff. Q: If my office is required to record phone calls, do intra office calls need to be recorded or just calls with prospective and current customers? A: It depends on the rule that requires your office to record phone calls. NFA Compliance Rule 2-10 in part, requires that Members...

By NIBARead article
3 min read

NYC Cybersecurity Panel Preview

Our industry has certainly transformed over the past decade. Much of this transformation stems from new rules and regulations, some of which are aimed at addressing the use of technology in the futures industry. As we are all aware, effective March 1, 2016, each and every NFA Member firm must adopt and enforce an information systems security program (“ISSP”). If you are not aware that this requirement exists, we encourage you to attend this session! NFA issued an interpretative notice approved by its Board of Directors on August 20, 2015 that provides guidance regarding information systems security practices that Member firms should adopt and tailor to their particular business activities and risks. This requirement falls upon all types of firms (FCMs, IBs, CPOs, CTA, RFEDs, Swap Dealers, and Major Swap Participants). During NIBA’s April 20, 2016 conference, I will be moderating a cybersecurity panel made up of experts spanning from...

By NIBARead article
Page 51