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 2015 Annual Pool Financial Statement Requirements The National Futures Association (“NFA”) has distributed reminder notices regarding filing requirements under Commodity Futures Trading Commission (“CFTC”) Regulations 4.7, 4.12 and 4.22 (“Annual Report Notice”) to Registered commodity pool operators (“CPOs”). Pursuant to CFTC Regulations, CPOs are required to distribute a certified audit (“Annual Report”) to investors within ninety (90) days after the fiscal year-end. Additionally, the Annual Report must be submitted to the NFA through the EasyFile system. For the December 31, 2015, fiscal year end, the Annual Report is due to the NFA and investors by March 30, 2016. CPO can request a due date extension, through EasyFile, pursuant to CFTC Regulation 4.22(f). An extension request must be submitted before the March 30th due date. Failing to comply with the filing deadlines may result in disciplinary action. CPOs will receive an Annual Report Notice with filing requirements specific...

By NIBARead article
3 min read

It’s a Shield, not a Sword

Brian Clark is the CEO of Ascent Technologies, Inc. (www.Ascent.is), a company that offers a compliance platform for users to help them identify, track, and manage the vast amount of regulations with which their firm has to comply. Businesses on the wrong side of the law often feel as if they’d been bludgeoned by instruments of jurisprudence, bearing a distinct scarlet letter from the administration of executive-based (re: administrative) and judicial-based (re: State/Federal Court) actions. Gone are the days of quiet settlements, and second chances: regulators in all industries increasingly look for large and small regulatory violations alike. Playing defense is more important than ever before. Creating a “culture of compliance” is a blunt phrase, the efficacy of which is up there with “it’s always in the last place you look” (duh). However, the conflict between allocating resources to a cost-side employees rather than its revenue-facing employees need not be...

By NIBARead article
5 min read

Cybersecurity for IBs, CTAs, and CPOs

The NFA recently adopted an Interpretive Notice titled “Information Systems Security Programs” (Cybersecurity Interpretive Notice). This new NFA policy, which goes into effect March 1, 2016, requires FCMs, IBs, CTAs, CPOs, RFEDs, SDs and MSPs to implement a cybersecurity program in order to meet existing obligations to diligently supervise trading activities. Every registrant will be required to put in place policies and procedures reasonably designed to monitor and mitigate the risks of unauthorized access or attack on its information technology systems and to respond appropriately if such access or attack should occur. The new cybersecurity requirement is in addition to and expands on firms’ current Privacy Policy and Disaster Recovery Policy requirements. In fact, some parts of your cybersecurity policy will likely already be included in those policies. There are three aspects of the cybersecurity requirement that all IBs, CTAs and CPOs must address: Develop a written policy Train your...

By NIBARead article
Member Announcements
1 min read

NIBA 2016 Calendar

Please find a complete listing of NIBA events, meetings and general happenings for the new year below: January 2016 2016 Membership Campaign Opens January 19th Last day for NFA Election Ballots to be Received January 19th NIBA Executive Board of Directors Meeting (Chicago) February 25th FCM/Service Provider Member Appreciation Reception (Chicago) March 16th NIBA Executive Board of Directors Meeting April 20th NIBA Board of Directors Meeting (NYC) April 20th NIBA Membership Meeting, New York Athletic Club (NYC) May 19th NIBA Membership Committee Meeting June 14th NIBA Executive Board of Directors Meeting (Chicago) July 13th NIBA Board of Directors Meeting (Chicago) July 14th Joint NIBA/DePaul University Event (Chicago) August 18th NIBA Executive Board Meeting September 13th NIBA Board of Directors Meeting (Chicago) September 14th NIBA Membership Meeting, CME Group Building (Chicago) September 15th CTA Expo (Chicago) October 18th NIBA in Washington DC November 29th Cyber Tuesday Event, DePaul University (Chicago) November...

By NIBARead article
Member Announcements
2 min read

NIBA Celebrates 25th Anniversary

This year marks the 25th Year the NIBA has been serving the futures industry. There have been plenty of good and bad times within the industry over the last quarter of a century but one thing remains the same, the NIBA has been here at your side trying to fight the good fight. NIBA has elected to make some changes moving into the next 25 years of the association. A facelift has been given to our logo and association tag line. Please visit www.theniba.com to have a look at the new logo and tag line. The NIBA has been known to all as "the National Introducing Brokers Association" and moving forward the NIBA will be "NIBA: The Association for Derivatives Professionals" This initiative is part of an outreach program to expand the membership of the association and service a wider range of commodities and futures professionals. NIBA is still the...

By NIBARead article
Member Announcements
3 min read

Chairman's Letter

Dear Members - The primary objectives of the NIBA have remained the same since we were founded in June 1991: To help members find greater success through education and networking, and, To provide members with a voice in regulatory and industry matters. To name just a few noteworthy objectives accomplished through regular member meetings, newsletters and representation of your interests and opinions at the CFTC, NFA and with exchanges and FCMs, they are: Lowering of NFA dues from $1,000 per year to $750 for IBs and CTAs. Requiring registration for offerers of hedge-to-arrive contracts. Opposing the merger of CFTC and SEC -- several times. Supporting greater certainty of regulating forex transactions. Supporting including two IB representatives on the NFA board when the proposal was for only one. Testifying before U.S. Congress on various issues, including proposed Farm Bill amendments and CFTC reauthorizations. Participating in CFTC Roundtables, including development of AML...

By NIBARead article
Managed Futures
1 min read

Advantages of a traditional portfolio allocating to a volatility index

For decades, investors frequently perceived a traditional portfolio allocation in the range of 60 percent equities and 40 percent bonds for proper diversification. Since 2000 investors, both large and small, have experienced several moments of negative returns to their portfolios. This experience has enlightened many investors to seek wider portfolio diversification in attempts to reduce their correlation risk, tail risk and negative volatility. As investors search for greater diversification, it begs the question, is there an added value to allocate some portion of a traditional portfolio to a volatility index, such as VSTOXX® Futures? Investors often view each component of their portfolio as a standalone investment. Ultimately asset allocation is about how each portfolio component compliments the entire portfolio. Asset allocation should be viewed as a holistic approach to portfolio management. READ MORE Mark Shore Shore Capital Research LLC Alternative Investment Research & Consulting http://www.linkedin.com/in/shorem http://www.shorecapmgmt.com https://twitter.com/shorecap Decoding the Myths...

By NIBARead article
Managed Futures
7 min read

Why you should get involved in managed futures

Happy New Year everyone! With the holidays behind us, I thought this would be a good opportunity to look at new business opportunities for the upcoming year. I work almost exclusively in the managed futures space. In speaking with brokers, I have found that they tend to be segregated into those who work primarily in transactional business, retail brokerage and hedging, and those who focus on managed futures accounts. Many transactional brokers know that commodity trading advisors (CTA’s) are out there, but they don’t know how they can become involved in that side of the business. The first question one should ask is, “why should I get involved with managed futures?” The biggest objection I run into when talking with transactional brokers is giving up control over trading their customers’ accounts. This is a natural reaction as nobody likes to give up control over their business. But I’m going to...

By NIBARead article
Member Announcements
3 min read

Michael T. Burke, CEO HighGround Trading LLC NFA Board of Directors IIB Representative, President NIBA

It has been my great pleasure for the last year to serve as your NFA Board of Directors IIB Representative. I appreciate your continued support and it is my honor to be allowed to serve a second one year term in this position in addition to serving my first term as President of the NIBA. I am pleased to report that during my first term on the NFA Board my suggestion to NFA staff to offer electronic voting to NFA members in NFA elections has been approved by the NFA Board and will come to fruition. While on the face this initiative may not seem to be a major accomplishment, it will allow for changes to be made that will give IB owners the ultimate control over who can be nominated as their representative for NFA board positions, who can sign petitions for individuals to be placed on the ballot...

By NIBARead article
Member Announcements
2 min read

NIBA Special Edition: NFA Elections 2016

Most of us have received our ballots for the upcoming NFA elections. NIBA is excited and looking forward to working with Paul Georgy and Mike Burke as the representatives for GIBs and IIBs on the NFA Board of Directors. They have both shown a deep understanding of the IB community and its needs. Paul and Mike are respected by both the IBs they represent and the regulators, and will continue to be effective voices for our opinions. NIBA has been asked to endorse all four candidates running in the contested races for CTA/CPO positions. There are currently 18 members of the NIBA board. Eleven are NFA-registered in the IB or CTA category, and therefore, eligible to vote on this issue. All non-registered members and FCM representatives were deemed ineligible to vote. NIBA board members were split on which candidates to support this year with John Roe and Doug Bry slightly...

By NIBARead article
Page 54