NFA Announces Effective Date for Amended Rules of Trade Costs Disclosure
The National Futures Association (NFA), a self-regulatory organization for the US derivatives industry, today said that the nation’s commodity regulator has approved its amendments to disclosure rules of retail forex costs.
The recent amendments, which will take effect on April 5, 2018, requires forex dealer members to provide additional trade disclosures and firm-specific âinformation that include commissions and any other fees. Last month, NFA submitted the proposed rule amendments to the CFTC for review.
The amended rule would require STP forex brokers, upon client demand, to disclose the full breakdown of any mark-ups or mark-downs they impose on the price they have received to execute the customer’s orders. For non-STP model, the broker must disclose the mid-point spread cost, which the NFA defines as the difference between the price of order execution and the mid-point of the bid/ask spread at the time of the order execution.
Additionally, forex dealers in the US must prominently display a notice on its website informing customers of their ability to request this information.