CFTC says single-stock perpetual futures can trade on dually registered venues

CFTC Chairman Michael Selig said on 3 November that perpetual futures on individual equity securities could begin trading on qualifying US exchanges. The contracts were deemed approved under Commission Regulation 40.3 as security futures products, putting them within both CFTC and SEC regulatory frameworks. Eligible venues are CFTC designated contract markets that are also notice-registered with the SEC as national securities exchanges for security futures.[1]

Perpetual futures give traders continuing exposure without the conventional fixed expiry of a dated stock future. Their funding, valuation and margin arrangements depend on the contract. For brokers, that makes the exchange specifications central to pricing and risk management: the absence of a regular expiry does not eliminate the cost of maintaining a position.

Selig presented the decision as a product of closer coordination with the SEC. His statement places equity perpetuals under the Commodity Exchange Act, federal securities laws and both agencies' applicable rules. It therefore preserves joint oversight of a product that combines an equity reference with a futures structure.[1]

Joint oversight and venue qualification

The regulatory decision is relevant to exchanges, clearing members and brokers preparing access to the contracts. Customer eligibility and the terms of a particular listing still determine whether and how an intermediary can offer them. The statement does not specify a universal funding rate, margin level or global distribution permission.[1]

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