A futures company refers to an intermediary organization that is established according to law, accepts the entrustment of customers, conducts futures trading for customers in its own name according to the instructions of customers, and collects transaction fees. Its nature is to act as a bridge between futures traders and futures exchanges.
The reason why futures companies should be established instead of allowing futures traders to directly enter the futures market is mainly because of the high risk of futures trading. The futures exchange must formulate a strict member trading system, and non-members are not allowed to enter the market for trading, so futures companies came into being.
2. What are the main businesses of futures companies?
Futures company is the medium of futures trading market, and it is the link and bridge connecting OTC traders and futures exchanges. Their businesses are diverse and can be mainly divided into four categories:
1, futures brokerage business
Futures companies charge a certain commission and conduct futures trading on behalf of customers through their own trading channels. At the same time, it provides customers with supporting services such as transaction, settlement, risk management, market information and information consultation.
2. Futures investment consulting business
Futures companies that have obtained the qualification of futures investment consulting can provide information services such as risk management consulting services (which should be different from those mentioned later), information research and analysis services, and transaction consulting services. And charge a certain consulting service fee.
3. Asset management business
After accepting the entrustment of customers, the futures company shall invest in the assets of customers in accordance with the provisions of the Measures for the Supervision and Administration of Futures Companies and the Interim Measures for the Supervision and Administration of Private Investment Funds and the contract, and collect fees or remuneration in accordance with the contract.
4. Risk management business
This kind of business includes basis trading, warehouse receipt service, cooperative hedging, pricing service, market-making business and other businesses related to risk management services, and the same business type is classified and managed.
Third, how do futures companies make money?
The profit sources of futures companies mainly include the following:
1. commission: This is the regular profit source of futures companies, and commissions are collected by trading futures on behalf of customers.
2. Custody funds: As long as there is no position in the trading funds, the futures company will make some money.
3. Product distribution: first earn management fees; Second, earn a share with high income; Third, there is a trading commission.
4. Agency fund: earn agency fees.