{"id":206,"date":"2016-08-31T08:22:28","date_gmt":"2016-08-31T08:22:28","guid":{"rendered":"http:\/\/www.makemoneytradingreviews.com\/?page_id=206"},"modified":"2020-09-21T09:02:39","modified_gmt":"2020-09-21T09:02:39","slug":"cftc-registered","status":"publish","type":"page","link":"https:\/\/www.makemoneytradingreviews.com\/cftc-registered\/","title":{"rendered":"The CFTC and the Forex Market"},"content":{"rendered":"
The number of traders massively increases every day in the Forex market. Some make millions in the market which serves as an inspiration to others to try to achieve the same. Congress established the CFTC in the 1970s. From then on, this Commission is responsible for futures trading and investments. Under the same legislation, the establishment of certified futures associations was granted, which enabled the founding of the NFA as an independent association to oversee Forex trading and to direct brokers to register with CFTC and become members of the NFA (See NFA registered brokers here<\/a>). The CFTC is an independent government body that is in charge of regulating futures. Their main goal is to protect market participants from scams, fraudulent activities, and malpractices that are connected to selling commodities and financial futures. The Commission consists of five members elected by the President for a five-year term. The members have to be approved by the Senate. One out of the five is elected as the Chairman. As in every organizational or government body that needs to ensure integrity, transparency plays one of the key factors in the CFTC.
\nMany brokerage companies arose with the growth of the market, and it is almost impossible to hold count of all of them.
\nAs we know, anywhere where money is quick, danger is not far away. The fast market gave space to many companies to engage in illegal activities and frauds. Many people were scammed in the currency game.
\nSince the conditions are sometimes really difficult and certain companies grow out of control, serious undertakings hire companies who are subject to national authorities, to regulate their business in order to prove fairness, ensure trust, and to protect their clients from frauds and scams.
\nThe United States, in contrast to some other countries, has mostly independent agencies running the conduct of businesses.
\nOne of those bodies is the CFTC- Commodity Futures Trading Commission<\/a>. CFTC registered companies offer a fair deal to their clients, partly due to CFTC regulation. It is always good when companies recognize the need for supervision to genuinely ensure a working and healthy business environment. The effort usually pays back handsomely.
\nFirst, let us discuss the CFTC and its role in the broker companies.<\/p>\nEstablishing the Commodity Futures Trading Commission (CFTC)<\/h2>\n
\nThe CFTC and the NFA go hand in hand and are connected on many levels. They share the same aims and cooperate very closely.
\nDuring the years, amendments to acts were passed that granted more authority and power to these organizations. They have the authority to enforce regulations related to financial services.<\/p>\nScope of Activity<\/h3>\n
\nThey try to maintain a healthy financial market by promoting competition and transparency in the broker business. Transparency helps a great deal in protecting clients\u2019 funds and keeping the business fair.
\nOne of their tasks is also to lower risks in the futures and swap markets by monitoring swap execution facilities, swap dealers and futures commission dealers, as well as other intermediaries.
\nThe CFTC has been entrusted to regulate and reform the swaps market after the 2008 crisis. The swaps market is worth $400 trillion and represents an ambitious undertaking.
\nThey want to bring back trust and confidence to the market by imposing strict market rules, standards, and policies.<\/p>\nThe CFTC Structure<\/h3>\n
\nThe CFTC consists of four divisions:
\na.) Clearing and Risk<\/strong>: monitors market participants (swap dealers, large traders, commission merchants, etc.) and DCOs in the clearing. It also makes risk assessment analyses.
\nb.) Enforcement<\/strong>: investigates violations of the law, prosecuting on the grounds of manipulation and abuse regarding commodity derivatives and swaps that harm the integrity of the market.
\nc.) Market Oversight<\/strong>: aims to strengthen the derivatives markets, monitoring trade execution facilities, reviewing if current exchanges comply with essential principles, etc.
\nd.) Swap Dealer and Intermediary Oversight<\/strong>: monitors registration of the intermediaries and futures self-regulatory organizations, and their compliance with the law, including, among many, the NFA.<\/p>\nTransparency Policy<\/h3>\n
\nOne of the best ways to prove transparency is by keeping the public informed. The CFTC publishes information during the meetings of the Commission and the Chairman, providing topics of the meeting, briefings, and the list of attendees.
\nThey regularly body issues weekly, monthly, and annual reports which are publicly accessible. The CFTC regulated brokers are subject to these reports and you can find all the information concerning their broker companies. They rate their work and inform the public of their activities.
\nAll information regarding the CFTC is available at the Background Affiliation Status Information Center (BASIC) website. There, you can find all CFTC registered Forex brokers.<\/p>\nBest Forex Brokers<\/h3>\n