NFA + CFTC Series 3
CEA Section 17 - correct answer ✔provides for the registration of industry
self-regulating organizations with the CFTC, which play a role in regulating the
actions of their members (NFA is the only such organization currently
registered)
NFA Regulatory Functions - correct answer ✔- auditing and surveillance of
NFA members for the purpose of enforcing and ensuring compliance with
NFA financial requirements
- establishment and enforcement of rules and standards to ensure customer
protection
- administration and maintenance of an arbitration process to adjudicate
disputes arising from futures and fx transactions
- determination of fitness of applicants for membership and review of
continuing membership of existing members
AP - correct answer ✔an individual who solicits or attempts (other than in a
clerical capacity) orders, discretionary accounts, or participation in a
commodity pool, or supervises any individual so engaged, on behalf of a
FCM, IB, CTA or ATOM
FB - correct answer ✔a person with exchange trading privileges who, in any
pit, ring, post, or other place provided by an exchange for the meeting of
persons similarly engaged, executes for another person any purchase or sale
of any commodity for future delivery
FT - correct answer ✔a person with exchange trading privileges who
executes his own trades by being personally present in the pit or ring for
futures trading
, CPO - correct answer ✔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, the commodity pool operator either itself makes trading decisions on
behalf of the pool or pr engages a commodity trading adviser to do so
CTA - correct answer ✔a person who, for pay, regularly engages in the
business of advising others as to the value of commodity futures or options, or
issues analyses or reports concerning commodity futures or options
IB - correct answer ✔a person (other than a person registered as an AP of a
FCM) who is engaged in soliciting or in accepting orders for the purchase or
sale of any commodity for future delivery on an exchange who does not
accept any money, securities, or property to margin, guarantee, or secure any
trades or contracts that result
FCM - correct answer ✔individuals, associations, partnerships, corporations,
and trusts that solicit or accept orders for the purchase or sale of any
commodity to future delivery on or subject to the rules of any exchange and
accept payment from or extend credit to those whose orders are accepted
ATOM (Agricultural Trade Options Merchants) - correct answer ✔any person
that is in the business of soliciting or entering options transactions involving an
enumerated agricultural commodity that are not conducted or executed on or
subject to the rules of an exchange
Rule 401 - correct answer ✔any NFA applicant acting in the following roles is
required to demonstrate proficiency via a satisfactory score on the Series 3
proficiency exam: FCM; RFED; IB; CPO; CPA; LTM; AP
CEA Section 17 - correct answer ✔provides for the registration of industry
self-regulating organizations with the CFTC, which play a role in regulating the
actions of their members (NFA is the only such organization currently
registered)
NFA Regulatory Functions - correct answer ✔- auditing and surveillance of
NFA members for the purpose of enforcing and ensuring compliance with
NFA financial requirements
- establishment and enforcement of rules and standards to ensure customer
protection
- administration and maintenance of an arbitration process to adjudicate
disputes arising from futures and fx transactions
- determination of fitness of applicants for membership and review of
continuing membership of existing members
AP - correct answer ✔an individual who solicits or attempts (other than in a
clerical capacity) orders, discretionary accounts, or participation in a
commodity pool, or supervises any individual so engaged, on behalf of a
FCM, IB, CTA or ATOM
FB - correct answer ✔a person with exchange trading privileges who, in any
pit, ring, post, or other place provided by an exchange for the meeting of
persons similarly engaged, executes for another person any purchase or sale
of any commodity for future delivery
FT - correct answer ✔a person with exchange trading privileges who
executes his own trades by being personally present in the pit or ring for
futures trading
, CPO - correct answer ✔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, the commodity pool operator either itself makes trading decisions on
behalf of the pool or pr engages a commodity trading adviser to do so
CTA - correct answer ✔a person who, for pay, regularly engages in the
business of advising others as to the value of commodity futures or options, or
issues analyses or reports concerning commodity futures or options
IB - correct answer ✔a person (other than a person registered as an AP of a
FCM) who is engaged in soliciting or in accepting orders for the purchase or
sale of any commodity for future delivery on an exchange who does not
accept any money, securities, or property to margin, guarantee, or secure any
trades or contracts that result
FCM - correct answer ✔individuals, associations, partnerships, corporations,
and trusts that solicit or accept orders for the purchase or sale of any
commodity to future delivery on or subject to the rules of any exchange and
accept payment from or extend credit to those whose orders are accepted
ATOM (Agricultural Trade Options Merchants) - correct answer ✔any person
that is in the business of soliciting or entering options transactions involving an
enumerated agricultural commodity that are not conducted or executed on or
subject to the rules of an exchange
Rule 401 - correct answer ✔any NFA applicant acting in the following roles is
required to demonstrate proficiency via a satisfactory score on the Series 3
proficiency exam: FCM; RFED; IB; CPO; CPA; LTM; AP
