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They will receive a fixed fee for introducing a client, as soon as the client meets the requirements set by the broker. Entering into, or purporting to enter into, transactions to give the appearance that purchases and sales have been made, without incurring market risk or changing the trader’s market position. A statistical measurement of the rate of price change of a futures contract, security, or other instrument underlying an option. A document indicating ownership of a commodity stored in a bank or other depository and frequently used as a delivery instrument in precious metal futures contracts. To give notice to the clearing organization of the intention to initiate delivery of the physical commodity in satisfaction of a short futures contract. A position created by combining call and put options.

• A market in which prices are demonstrating either an inability to advance or a slight tendency to decline.
• If you don’t want to change your name, try always using it in conjunction with a distinctive brand name or a corporate name that advertises your IB service.
• When he first brought a 12-inch-long by 9-inch-wide device to the exchange floor, a committee in the exchange told him it was too big.
• This is the rewarding task of winning them over and making them long-term clients.
• This does not necessarily represent the refining margin because a barrel of crude yields varying amounts of petroleum products.
• The IB is usually affiliated with the FCM, either as an independent entity that is partnered with that merchant firm or as a direct subsidiary of that FCM.
• A person engaged in a business similar to an investment trust or a syndicate and who solicits or accepts funds, securities, or property for the purpose of trading commodity futures contracts or commodity options.

Alternatively, please contact IB Customer Service to receive a copy of the ODD. Before trading, clients must read the relevant risk disclosure statements on our Warnings and Disclosures page. Trading on margin is only for experienced investors with high risk tolerance. For additional information about rates on margin loans, please see Margin Loan Rates. Security futures involve a high degree of risk and are not suitable for all investors. The amount you may lose may be greater than your initial investment.

Introducing BrokersIB / Affiliates

IB also released the TWS Mosaic trading interface and the Tax Optimizer for managing capital gains and losses. Security-based swap dealer The term “security-based swap dealer” has the meaning given the term in section 3 of the Securities Exchange Act of 1934 (15 U.S.C. 78c). A graphic representation of market yield for a fixed income security plotted against the maturity of the security. The yield curve is positive when long-term rates are higher than short-term rates. The tendency of an option to decline in value as the expiration date approaches, especially if the price of the underlying instrument is exhibiting low volatility.

Refers to the dealers in the London Bullion Market Association who set the gold price in London. A hedged position that cannot be lifted without offsetting both sides of the hedge . A market in which selling and introducing broker meaning buying can be accomplished with minimal effect on price. A spread involving two different months of the same commodity. Generally a debt instrument on which the payments are adjusted for inflation and deflation.

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The CFTC Glossary is intended to assist the public in understanding some of the specialized words and phrases used in the futures industry since many of these terms are not found in standard reference works. The CFTC Glossary is not inclusive, and if you cannot find the term you are looking for or have any other comments, please let us know. We offer a large range of products and services to enhance your business operations. From https://xcritical.com/ trade date to settlement date, our Securities Financing solutions provide depth of availability, transparent rates, global reach and automated lending and borrowing tools. Our proprietary API and FIX CTCI solutions let institutions create their own automated, rules-based trading system that takes advantage of our high-speed order routing and broad market depth. Easily maintain different fee schedules for multiple client accounts.

Treasury bill futures contract and the price of the three-month Eurodollar time deposit futures contract with the same expiration month . The actual commodity as distinguished from a futures contract; sometimes used to refer to cash commodities available for immediate delivery. A situation where producers, processors, merchants, or consumers of a commodity establish commercial transaction prices based on the futures prices for that or a related commodity (e.g., an offer to sell corn at 5 cents over the December futures price). A shorthand method of referring to the payment of a loss and receipt of a gain by a clearing member to or from a clearing organization that occurs after a futures position has been marked-to-market.

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A trading system or platform created by the Dodd-Frank Act in which multiple participants have the ability to execute or trade swaps by accepting bids and offers made by multiple participants in the facility or system, through any means of interstate commerce. The Dodd-Frank Act imposed different statutory provisions on SEFs than on designated contract markets. The selling side of an open futures contract; a trader whose net position in the futures market shows an excess of open sales over open purchases. A transaction in which one party sells a security to another party while agreeing to repurchase it from the counterparty at some date in the future, at an agreed price. Repos allow traders to short-sell securities and allow the owners of securities to earn added income by lending the securities they own. Through this operation the counterparty is effectively a borrower of funds to finance further.

The euro denominated rate of interest at which banks borrow funds from other banks, in marketable size, in the interbank market. An agency of the US Department of Energy that provides statistics, data, analysis on resources, supply, production, consumption for all energy sources. EIA data includes weekly inventory statistics for crude oil and petroleum products as well as weekly natural storage data. The discount allowed for grades or locations of a commodity lower than the par of basis grade or location specified in the futures contact. Sometimes current delivery is used as a synonym for nearby delivery.

Introducing Broker Meaning & Definition

For example, the price of an option with a delta of 0.5 would be expected to change $0.50 when the underlying commodity or asset’s price moves $1.00. The date on which the commodity or instrument of delivery must be delivered to fulfill the terms of a contract. In technical analysis, the method by which a trader takes a position contrary to the current market direction in anticipation of a change in that direction. Market situation in which prices in succeeding delivery months are progressively higher than in the nearest delivery month; the opposite of contango is backwardation. Puts and calls held either long or short with different strike prices and/or expirations. Types of combinations include straddles and strangles.

Futures commission merchants and introducing brokers in commodities are subject to the reporting requirements set forth and cross referenced in this subpart. Futures commission merchants and introducing brokers in commodities should also refer to subpart C of part 1010 of this chapter for reporting requirements contained in that subpart which apply to futures commission merchants and introducing brokers in commodities. Futures commission merchants and introducing brokers in commodities are subject to the program requirements set forth and cross referenced in this subpart. Futures commission merchants and introducing brokers in commodities should also refer to subpart B of part 1010 of this chapter for program requirements contained in that subpart which apply to futures commission merchants and introducing brokers in commodities. Reports by futures commission merchants and introducing brokers in commodities of suspicious transactions.

Broker

Please read the full risk disclosure on pages of our Terms of Business. An FCM or IB–C shall maintain a copy of any SAR filed and the original or business record equivalent of any supporting documentation for a period of five years from the date of filing the SAR. Supporting documentation shall be identified as such and maintained by the FCM or IB–C, and shall be deemed to have been filed with the SAR. The services and operations are continually updated to ensure that our IBs have the best research, technology, execution, clearing and full-service back office support that is available in the futures industry. A lot of people are slightly confused regarding the difference between a Forex Affiliate and an Introducing Broker. As formerly mentioned, Introducing Brokers are given important amounts of information concerning their referrals and are frequently expected to foster relationships with those customers.

Generally speaking, introducing brokers make recommendations while delegating the task of executing trades to someone at the same or a different firm who operates on a trading floor. The introducing broker and the person who execute a transaction split the fees and commissions according to some agreed upon arrangement. The term most often applies to brokers in the futures market. Special information sharing procedures to deter money laundering and terrorist activity for futures commission merchants and introducing brokers in commodities. The arrangement allows for specialization where the IB focuses on the client while the FCM focuses on trading floor operations.