| |
Futures |
Stocks/ETFs |
| regulated by: |
CFTC |
SEC |
| Exchanges traded on: |
CME Group |
NYSE, Nasdaq, etc. |
| fiduciary responsibility: |
FCM |
Broker-Dealer |
| underlying assets: |
Equities, FX, Interest Rates, and Commodities. |
stocks are categorized as Equities. Some ETFs provide exposure to Interest Rates, FX, and Commodities. |
| margin and leverage: |
performance bond - usually 1-5% of the notional value of the contract. |
Reg-T states that a broker can lend up to 50% of the purchase price of a position to the customer. |
| contract structure |
defined contracts to buy and sell a certain amount of the commodity/instrument by the expiration date of the contract. |
Each share represents a piece of ownership of the firm. |
| dividends paid: |
No |
Yes. |
| Taxes on short-term gains: |
60/40 rule |
ordinary income |
| investor protections: |
none |
SIPC |
