What is the role of an introducing broker?
An introducing broker (IB) acts as a middleman by matching an entity seeking access to markets with a counterparty willing to take the other side of the transaction. Generally speaking, IBs make recommendations while delegating the task of executing trades to someone who operates on a trading floor.
What does it mean to broker an introduction?
Definition of Introducing Broker An Introducing broker, is a broker dealer who introduces customer accounts to a clearing broker dealer. The introducing broker dealer does not hold (provide safekeeping for) customer assets or settle trades with counterparties.
Is an introducing broker an associated person?
An associated person (AP) is an individual who solicits orders, customers or customer funds (or who supervises persons so engaged) on behalf of a futures commission merchant (FCM), retail foreign exchange dealer (RFED), introducing broker (IB), commodity trading advisor (CTA) or commodity pool operator (CPO).
What is an independent introducing broker?
Introducing brokers (IB) may be independent, meaning they use the services of futures commission merchants (FCM) for clearing without entering into a guarantee agreement with an FCM, or guaranteed, meaning that the FCM is liable for any acts and omissions by its guaranteed IB.
Who must register with NFA?
The Commodity Exchange Act (CEA) requires certain firms and individuals that conduct business in the derivatives industry to register with the CFTC. CFTC regulations also require, with few exceptions, CFTC registered firms to be NFA Members. The CFTC has delegated registration responsibility to NFA.
Who are NFA members?
NFA Members
- Commodity Pool Operator (CPO)
- Commodity Trading Advisor (CTA)
- Futures Commission Merchant (FCM)
- Forex Dealer Member (FDM)
- Introducing Broker (IB)
- Swap Dealer (SD)
What is introducing broker finra?
(c) The term “Introducing Broker-Dealer” or “Introducing Broker” shall mean the member firm that has been identified in the System as a party to the transaction, but does not execute or clear trades.
What is an introducing broker finra?
How do I become an IB member of NFA?
All registered IBs must be NFA Members. To register as an IB and become an NFA Member: Designate a Security Manager in order to obtain secure access to NFA’s Online Registration System (ORS) An IB is required to file the following for its principals and associated persons:
What is an introducing broker?
An introducing broker (IB) is an individual or organization that solicits or accepts orders to buy or sell futures contracts, commodity options, retail off-exchange forex contracts, or swaps but does not accept money or other assets from customers to support these orders. Registration is required for an IB unless the individual or organization is:
How do I obtain secure access to NFA’s online registration system?
Designate a Security Manager in order to obtain secure access to NFA’s Online Registration System (ORS) An IB is required to file the following for its principals and associated persons: Satisfy proficiency requirements for each sole proprietor, AP, forex AP and swap AP
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