The CFTC has reacted to Tradesports‘ futures-like contracts that many U.S. residents have been trading without CFTC regulation.
It is surprising how closely the contracts that they objected to coincide with contracts traded under CFTC regulation – they apparently have prohibited Tradesports from offering to U.S. residents contracts on the results of the next Fed meeting (which Hedgestreet trades under CFTC regulation; Tradesports stopped offering these in May, possibly due to negotiations with the CFTC) but as far as I can tell Tradesports is still able to offer contracts on where the Fed Funds rate will be at the end of the year.
I am also surprised that the CFTC classified the contracts as futures options rather than futures. They do have something resembling as strike price, but otherwise resemble a futures contract more than they resemble an option.
3 comments on “CFTC and Tradesports”
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Hello Peter McCluskey,
Understood your point #2.
I don’t get your point #1. TradeSports’ American branch (InTrade or Trade4Real?) will be able to resume those contracts once it gets the CFTC stamp of approval (for being a contract maker, I believe).
More from Tom Bell:
http://agoraphilia.blogspot.com/2005/10/good-news-cftc-busts-intrade.html
Best regards,
Chris. F. Masse
Presumably the CFTC will approve some contracts that Tradesports wants to trade, but I don’t know how to predict what will be approved, so I only described the current situation.
– Peter
Hello,
I understand.
For the readers who would like to know more about TradeSports and the CFTC, I have compiled a webpage where I have patched everything. I do not offer any comment; just the facts and the links.
TradeSports/InTrade/Trade4Real and the C.F.T.C.
(Its URL should appear in blue under my name.)
Best regards,
Chris. F. Masse