Sat, Aug 30, 2014
A A A
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Alternative Market Briefing

New CFTC rules add to buy-side firms’ growing compliance burden

Tuesday, December 18, 2012

Bailey McCann, Opalesque New York:

New rules for financial firms from the US Commodities Futures Trading Commission (CFTC) going into effect this month are requiring many firms to register as commodity pool operators. These new requirements are causing all types of firms to reconsider their activities in commodities in order to determine if the registration is worth it. However, even if a firm wants to claim that they are exempt, they will still have to register with the CFTC to claim the exemption.

In essence, firms will have to track – on a daily basis – their initial margin and net notional value when they make commodities trades in order to determine whether they meet the threshold for registration with the CFTC. If they do, they will have to add CFTC compliance to a growing list of regulations being imposed on alternative investment firms.

"The old exemption from registration prescribed by the CFTC was based on the types of investors that participated in the pool. As long as the participants satisfied the 'eligible person standard' of Regulation 4.7 of the Commodities Exchange Act (CEA), they were exempt," explains Matt Grinnell, Buy-Side compliance officer at Fidessa in an interview with Opalesque. Now, firms that meet the de minimus test for initial margin and net notional value will have to register regardless – and the clock is running out. Firms have until the end of this month to register with the CFTC.

"Private pool registration requires ......................

To view our full article Click here

Today's Exclusives Today's Other Voices More Exclusives
Previous Opalesque Exclusives                                  
More Other Voices
Previous Other Voices                                               
Access Alternative Market Briefing
  • Top Forwarded
  • Top Tracked
  • Top Searched
  1. Study shows what resonates with investors: 'Unwavering', 'passionate' beats 'committed', 'dedicated' and more surprises[more]

    Komfie Manalo, Opalesque Asia: A new study by Pershing Square, a unit of BNY Mellon company, showed that an effective value proposition strengthens audience connections and fosters growth, yet many advisors have had little objective guidance in formulating such statements until now. In the

  2. Comment – Why you should avoid the hottest hedge fund hands, Swedroe attacks Hussman over risk management, relative value strategy[more]

    Why you should avoid the hottest hedge fund hands FromCNBC/Yahoo.com: Investors who don't have money with Pershing Square Capital Management are likely salivating at the hedge fund's industry-leading 26 percent return from January through July. But investing with Bill Ackman and other to

  3. Hedge fund assets decline in July - eVestment[more]

    Bailey McCann, Opalesque New York: Total assets in hedge funds declined in July and dropped 0.49%, marking the industry's second monthly asset decline in 2014, according to the latest asset flows data from eVestment. Despite the asset decline, total industry AUM remained above the $3 trillion

  4. AIMA makes 'the case for hedge funds'[more]

    Bailey McCann, Opalesque New York: The Alternative Investment Management Association (AIMA), the global hedge fund industry body,

  5. Managed futures' global diversification is important in next phase of economic recovery[more]

    Komfie Manalo, Opalesque Asia: The global diversification provided by managed futures may prove to be extremely valuable as the markets enter the next phase of the economic recovery, said Campbell & Company, a pioneer in absolute return invest