Series 3: 7.1.4.2. Domestic Commodity Pool Operator Exemptions

7.1.4.2. Domestic Commodity Pool Operator Exemptions

Recall that a commodity pool is an investment vehicle that pools the funds of several investors for trading in futures and options. Investors place their funds in the pool, and the pool uses the funds to make its investments. Investors share the pool’s profits and losses on a pro rata basis. A pool is not open to the general public, and it usually requires an investment of at least $10,000. Once a pool reaches a certain size, it stops adding new members to the pool.

A firm is exempt from registration as a commodity pool operator, if it operates only one pool at any particular time and it meets the following requirements:

• It receives no compensation other than reimbursements of its administrative expenses for operating the pool.

• Neither the firm nor any of