NFA (National Futures Association)

The National Futures Association (NFA) is a self-regulatory organization (SRO) in the United States that oversees and regulates the activities of firms and individuals in the futures and derivatives markets. It was established in 1982 under the supervision of the Commodity Futures Trading Commission (CFTC).

The primary mission of the NFA is to protect investors, maintain market integrity, and promote transparency in the futures industry. To achieve this, the NFA enforces rules and regulations that govern the conduct of its member firms and individuals.

NFA membership is mandatory for any firm or individual involved in futures trading, including futures commission merchants (FCMs), commodity trading advisors (CTAs), commodity pool operators (CPOs), introducing brokers (IBs), and retail foreign exchange dealers (RFEDs). The NFA sets and enforces compliance standards for these entities, ensuring they meet financial requirements, maintain proper records, and adhere to fair business practices.

The NFA also provides educational resources and programs to help investors understand the risks and opportunities in the futures markets. It offers online courses, webinars, and publications to promote investor education and protection. Additionally, the NFA operates a comprehensive online database called BASIC (Background Affiliation Status Information Center), which provides information about registered individuals and firms, including disciplinary actions and regulatory history.

As an SRO, the NFA has the authority to enforce its rules and regulations through disciplinary actions. It investigates complaints and conducts audits and examinations to ensure compliance with its requirements. The NFA can impose sanctions, fines, and other penalties on members found to have violated its rules.

In summary, the National Futures Association (NFA) is a self-regulatory organization in the United States that oversees and regulates firms and individuals involved in the futures and derivatives markets. Its main objectives are to protect investors, maintain market integrity, and promote transparency. The NFA enforces compliance standards, provides educational resources, and takes disciplinary actions to ensure the fair and responsible operation of the futures industry.