Commodity pool
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In a commodity pool, a group of investors pool their money to trade in futures contracts as one entity to gain leverage they would not have trading individually. Unlike mutual funds, commodity pools are private. They are regulated by the CFTC and the NFA. Many hedge funds are commodity pools.
Benefits also include bypassing margin requirements and limiting risk to the amount invested in the pool. Additionally, the commodity pool operator may be exempt from registration requirements, depending on the number of participants, capital contributions, and whether participants are accredited investors or qualified purchasers.[1]
References[edit]
- ↑ Commodity Pool Operator (CPO). National Futures Association.