CFTC approves perpetual futures on US exchanges with SEC oversight
Big news for US traders: the Commodity Futures Trading Commission (CFTC) just approved perpetual futures (also known as equity perps) tied to individual stocks on regulated American exchanges.
These contracts will now be jointly overseen by the CFTC and the SEC, making it safer for US investors to access them: no need to rely on offshore, and often unregulated, venues.
Perpetual futures offer leveraged stock exposure
Perpetual futures let you bet on stock prices without actually owning any shares, and you can use leverage to boost your potential gains (or losses).
They're already huge in crypto trading, with more than $630 billion in recent volume.
The move is all about giving Americans more secure ways to trade these popular products: CFTC Chairman Michael Selig called it, "I believe that bringing these types of innovative products into our regulated markets ensures that American investors and traders can access these products within the protections of the CFTC's proven regulatory framework, rather than being forced to turn to offshore, and often unregulated, venues."
This was made possible thanks to a law from 2000 that helps the SEC and the CFTC team up on new financial products.