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Position Limits for Derivatives

Issue

OTC Derivatives→

Summary

SIFMA AMG, Managed Funds Association (MFA) and Alternative Investment Management Association (AIMA) provided comments to the Commodity Futures Trading Commission (CFTC) on the CFTC’s reproposed position limits rulemaking.

Among other comments, SIFMA AMG, MFA and AIMA urged the CFTC, to clearly articulate its interpretation of “excessive speculation” and apply position limits only to those contracts for which it makes a specific necessity finding and determination of the appropriateness of the limits for each such contract.

PDF

Submitted To

Commodity Futures Trading Commission (CFTC)

Submitted By

SIFMA AMG, Managed Funds Association (MFA) and Alternative Investment Management Association (AIMA)

Related Committee(s)

  • Swap Dealer Committee

Date

28

February

2017

Excerpt

Christopher Kirkpatrick
Secretary
Commodity Futures Trading Commission
Three Lafayette Centre
1155 21st Street, NW
Washington, DC 20581

Re: Position Limits for Derivatives; RIN 3038-AD99

Dear Mr. Kirkpatrick:

Managed Funds Association (“MFA”), the Asset Management Group of the Securities Industry and Financial Markets Association (“SIFMA AMG”), and the Alternative Investment Management Association (“AIMA”) (collectively, the “Associations”)1 appreciate the opportunity to provide comments to the Commodity Futures Trading Commission (the “Commission” or “CFTC”) on its reproposed position limits rulemaking (the “Reproposal”). 2

The Associations’ members have a keen interest in the Commission’s efforts to finalize a prudent position limits regime. They utilize commodity derivatives in their capacity as fiduciaries
to private and public funds as well as separately managed accounts for a wide range of investors and retirement savers, and rely on fair, competitive and transparent pricing and liquidity.
Investment funds and separately managed account clients play a vital role in these markets by assuming price risk from commercial participants (hedgers) on the long and short sides of the market, and providing the liquidity that facilitates price discovery and risk transfer for businesses around the world. As such, the Associations are concerned that any rule that would prevent the Associations’ members from trading on behalf of their clients or unnecessarily or disproportionately increase the costs of compliance would harm the liquidity and price discovery function of the derivatives market.

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