What does Commodity Trading Advisor (CTA) mean?
An individual or firm that provides advice on investing in commodities or managed futures.
CTAs may provide other services also such as managing investment accounts and trading futures on behalf of clients. Commodities may be grains, metals, and energy and financial instruments like bonds and currency.
Futures Knowledge Explains Commodity Trading Advisor (CTA)
A CTA advises clients on buying and selling of commodities or futures, forwards, swaps and options. The CTA along with providing recommendations, may also transact or trade in the capacity of its client.
A CTA needs to be a member (in good standing) of the National Futures Association (NFA) and registered with the Commodities Futures Trading Commission (CFTC). A CTA is supposed to advice clients based on their profile, interest, risk capacity and financial goal. The CTA normally gets a commission fee or compensation for the services and advice provided to the clients.