Commodity broker

Today, commodity brokers trade a wide variety of financial derivatives based on not only grain and livestock, but also derivatives based on foods/softs, metals, energy, stock indexes, equities, bonds, currencies, and an ever growing list of other underlying assets.

[2] Post the implementation of the Volcker rule in 2014, the number of commodity trading houses and individual brokers have dwindled.

When executing trades on behalf of a client in exchange for a commission he is acting in the role of a broker.

[4] Futures Commission Merchant (FCM): a firm or individual that solicits or accepts orders for commodity contracts traded on an exchange and holds client funds to margin, similar to a securities broker-dealer.

[5] Introducing Broker (IB): a firm or individual that solicits or accepts orders for commodity contracts traded on an exchange.

[8] Registered Commodity Representative (RCR)/Associated Person (AP): an employee, partner or officer of a FCM, IB, CTA, or CPO, duly registered and licensed to conduct the activities of a FCM, IB, CTA, or CPO.

In the United States, an individual working in any of the above roles must pass the Series 3 National Commodity Futures Examination administered by the Financial Industry Regulatory Authority (FINRA).