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RISK DISCLOSURE STATEMENT
FUTURES
The risk of loss in trading commodity futures contracts can be substantial. You should, therefore, carefully consider whether such trading
is suitable for you in light of your circumstances and financial resources. You should be aware of the following points:
1. You may sustain a total loss of the funds that you deposit with your broker to establish or maintain a position in the commodity
futures market, and you may incur losses beyond these amounts. If the market moves against your position, you may be called
upon by your broker to deposit a substantial amount of additional margin funds, on short notice, in order to maintain your position.
If you do not provide the required funds within the time required by your broker, your position may be liquidated at a loss, and you
will be liable for any resulting deficit in your account.
2. The funds you deposit with a futures commission merchant for trading futures positions are not protected by insurance in the event
of the bankruptcy or insolvency of the futures commission merchant, or in the event your funds are misappropriated.
3. The funds you deposit with a futures commission merchant for trading futures positions are not protected by the Securities
Investor Protection Corporation even if the futures commission merchant is registered with the Securities and Exchange
Commission as a broker or dealer.
4. The funds you deposit with a futures commission merchant are generally not guaranteed or insured by a derivatives clearing
organization in the event of the bankruptcy or insolvency of the futures commission merchant, or if the futures commission
merchant is otherwise unable to refund your funds. Certain derivatives clearing organizations, however, may have programs that
provide limited insurance to customers. You should inquire of your futures commission merchant whether your funds will be
insured by a derivatives clearing organization and you should understand the benefits and limitations of such insurance programs.
5. The funds you deposit with a futures commission merchant are not held by the futures commission merchant in a separate account
for your individual benefit. Futures commission merchants commingle the funds received from customers in one or more accounts
and you may be exposed to losses incurred by other customers if the futures commission merchant does not have sufficient capital
to cover such other customers' trading losses.
6. The funds you deposit with a futures commission merchant may be invested by the futures commission merchant in certain types
of financial instruments that have been approved by the Commission for the purpose of such investments. Permitted investments
are listed in Commission Regulation 1.25 and include: U.S. government securities; municipal securities; money market mutual
funds; and certain corporate notes and bonds. The futures commission merchant may retain the interest and other earnings realized
from its investment of customer funds. You should be familiar with the types of financial instruments that a futures commission
merchant may invest customer funds in.
7. Futures commission merchants are permitted to deposit customer funds with affiliated entities, such as affiliated banks, securities
brokers or dealers, or foreign brokers. You should inquire as to whether your futures commission merchant deposits funds with
affiliates and assess whether such deposits by the futures commission merchant with its affiliates increases the risks to your funds.
8. You should consult your futures commission merchant concerning the nature of the protections available to safeguard funds or
property deposited for your account.
9. Under certain market conditions, you may find it difficult or impossible to liquidate a position. This can occur, for example, when
the market reaches a daily price fluctuation limit (“limit move”).
10. All futures positions involve risk, and a “spread” position may not be less risky than an outright “long” or “short” position.
11. The high degree of leverage (gearing) that is often obtainable in futures trading because the small margin requirements can work
against you as well as for you. Leverage (gearing) can lead to large losses as well as gains.
12. In addition to the risks noted in the paragraphs enumerated above, you should be familiar with the futures commission merchant
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you select to entrust your funds for trading futures positions. The Commodity Futures Trading Commission requires each futures
commission merchant to make publicly available on its Web site firm specific disclosures and financial information to assist you
with your assessment and selection of a futures commission merchant. Information regarding this futures commission merchant
may be obtained by visiting our Web site.
OPTIONS
Variable degree of risk
13. Transactions in options carry a high degree of risk. Purchasers and seller of options should familiarize themselves with the type of
option (i.e., put or call) which they contemplate trading and the associated risks. You should calculate the extent to which the
value of the options must increase for your position to become profitable, taking into account the premium and all transaction
costs.
14. The purchaser of options may offset or exercise the options or allow the options to expire. The exercise of an option results either
in a cash settlement or in the purchaser acquiring or delivering the underlying interest. If the option is on a future, the purchaser
will acquire a futures position with associated liabilities for margin (see the section on Futures above). If the purchased options
expire worthless, you will suffer a total loss of your investment which will consist of the option premium plus transaction costs. If
you are contemplating purchasing deep-out-of-the-money options, you should be aware that the chance of such options becoming
profitable is ordinarily remote.
15. Selling ('writing' or 'granting') an option generally entails considerably greater risk than purchasing options. Although the premium
received by the seller is fixed, the seller may sustain a loss well in excess of that amount. The seller will be liable for additional
margin to maintain the position if the market moves unfavorably. The seller will also be exposed to the risk of the purchaser
exercising the option and the seller will be obligated to either settle the option in cash or to acquire or deliver the underlying
interest. If the option is on a future, the seller will acquire a position in a future with associated liabilities for margin (see the
section on Futures above). If the position is 'covered' by the seller holding a corresponding position in the underlying interest or a
future or another option, the risk may be reduced. If the option is not covered, the risk of loss can be unlimited.
16. Certain exchanges in some jurisdictions permit deferred payment of the option premium, exposing the purchaser to liability for
margin payments not exceeding the amount of the premium. The purchaser is still subject to the risk of losing the premium and
transaction costs. When the option is exercised or expires, the purchaser is responsible for any unpaid premium outstanding at that
time.
ADDITIONAL RISKS COMMON TO FUTURES AND OPTIONS
Terms and conditions of contracts
17. You should ask the firm with which you deal about the term and conditions of the specific futures or options which you are trading
and associated obligations (e.g., the circumstances under which you may become obligated to make or take delivery of the
underlying interest of a futures contract and, in respect of options, expiration dates and restrictions on the time for exercise). Under
certain circumstances the specifications of outstanding contracts (including the exercise price of an option) may be modified by the
exchange or clearing house to reflect changes in the underlying interest.
Suspension or restriction of trading and pricing relationships
18. Market conditions (e.g., illiquidity) and/or the operation of the rules of certain markets (e.g., the suspension of trading in any
contract or contract month because of price limits or 'circuit breakers') may increase the risk of loss by making it difficult or
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impossible to effect transactions or liquidate/offset positions. If you have sold options, this may increase the risk of loss.
19. Further, normal pricing relationships between the underlying interest and the future, and the underlying interest and the option may
not exist. This can occur when, for example, the futures contract underlying the option is subject to price limits while the option is
not. The absence of an underlying reference price may make it difficult to judge 'fair' value.
Deposited cash and property
20. You should familiarize yourself with the protections accorded money or other property you deposit for domestic and foreign
transactions, particularly in the event of a firm insolvency or bankruptcy. The extent to which you may recover your money or
property may be governed by specified legislation or local rules. In some jurisdictions, property which has been specifically
identifiable as your own will be pro-rated in the same manner as cash for purposes of distribution in the event of a shortfall.
Commission and other charges
21. Before you begin to trade, you should obtain a clear explanation of all commission, fees and other charges for which you will be
liable. These charges will affect your net profit (if any) or increase your loss.
Currency risks
22. The profit or loss in transactions in foreign currency-denominated contracts (whether they are traded in your own or another
jurisdiction) will be affected by fluctuations in currency rates where there is a need to convert from the currency denomination of
the contract to another currency.
Trading facilities
23. Most open-outcry and electronic trading facilities are supported by computer-based component systems for the order-routing,
execution, matching, registration or clearing of trades. As with all facilities and systems, they are vulnerable to temporary
disruption or failure. Your ability to recover certain losses may be subject to limits on liability imposed by the system provider, the
market, the clearing house and/or member firms. Such limits may vary; you should ask the firm with which you deal for details in
this respect.
Electronic trading
24. Trading on an electronic trading system may differ not only from trading in an open-outcry market but also from trading on other
electronic trading systems. If you undertake transactions on an electronic trading system, you will be exposed to risk associated
with the system including the failure of hardware and software. The result of any system failure may be that your order is either
not executed according to your instructions or is not executed at all.
Off-exchange transactions
25. In some jurisdictions, and only then in restricted circumstances, firms are permitted to effect off-exchange transactions. The firm
with which you deal may be acting as your counterparty to the transaction. It may be difficult or impossible to liquidate an existing
position, to assess the value, to determine a fair price or to assess the exposure to risk. For these reasons, these transactions may
involve increased risks. Off-exchange transactions may be less regulated or subject to a separate regulatory regime. Before you
undertake such transactions, you should familiarize yourself with applicable rules and attendant risks.
ALL OF THE POINTS NOTED ABOVE APPLY TO ALL FUTURES TRADING WHETHER FOREIGN OR DOMESTIC. IN
ADDITION, IF YOU ARE CONTEMPLATING TRADING FOREIGN FUTURES OR OPTIONS CONTRACTS, YOU SHOULD BE
AWARE OF THE FOLLOWING ADDITIONAL RISKS:
26. Foreign futures transactions involve executing and clearing trades on a foreign exchange. This is the case even if the foreign
exchange is formally “linked” to a domestic exchange, whereby a trade executed on one exchange liquidates or establishes a
position on the other exchange. No domestic organization regulates the activities of a foreign exchange, including the execution,
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delivery, and clearing of transactions on such an exchange, and no domestic regulator has the power to compel enforcement of the
rules of the foreign exchange or the laws of the foreign country. Moreover, such laws or regulations will vary depending on the
foreign country in which the transaction occurs. For these reasons, customers who trade on foreign exchanges may not be afforded
certain of the protections which apply to domestic transactions, including the right to use domestic alternative dispute resolution
procedures. In particular, funds received from customers to margin foreign futures transactions may not be provided the same
protections as funds received to margin futures transactions on domestic exchanges. Before you trade, you should familiarize
yourself with the foreign rules which will apply to your particular transaction.
27. Finally, you should be aware that the price of any foreign futures or option contract and, therefore, the potential profit and loss
resulting therefrom may be affected by any fluctuation in the foreign exchange rate between the time the order is placed and the
foreign futures contract is liquidated or the foreign option contract is liquidated or exercised.
THIS BRIEF STATEMENT CANNOT, OF COURSE, DISCLOSE ALL THE RISKS AND OTHER ASPECTS OF THE COMMODITY
MARKETS.
✔I/we acknowledge that I/we have read and understand the foregoing and intend to rely upon it and that I/we intend to be bound thereby.
I/we understand and agree that my/our electronic signature is the equivalent of a manual signature and that Tradovate may rely upon it as
such.
Name chao-xin yu
User Id lovetienwu ID: 770161182
Datetime Signed Apr 16, 2025, 7:39:11 PM
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ELECTRONIC TRADING AND ORDER ROUTING SYSTEMS DISCLOSURE STATEMENT
Electronic trading and order routing systems differ from traditional open outcry pit trading and manual order routing methods.
Transactions using an electronic system are subject to the rules and regulations of the exchange(s) offering the system and/or listing the
contract. Before you engage in transactions using an electronic system, you should carefully review the rules and regulations of the
exchange(s) offering the system and/or listing contracts you intend to trade.
DIFFERENCES AMONG ELECTRONIC TRADING SYSTEMS
Trading or routing orders through electronic systems varies widely among different electronic systems. You should consult the rules and
regulations of the exchange offering the electronic system and/or listing the contract traded or order routed to understand, among other
things, in the case of trading systems, the system’s order matching procedure, opening and closing procedures and prices, error trade
policies, and trading limitations or requirements; and in the case of all systems, qualifications for access and grounds for termination and
limitations on the types of orders that may be entered into the system. Each of these matters may present different risk factors with respect
to trading on or using a particular system. Each system may also present risks related to the system access, varying response times, and
security. In the case of internet-based systems, there may be additional types of risks related to system access, varying response times and
security, as well as risks related to service providers and the receipt and monitoring of electronic mail.
RISKS ASSOCIATED WITH SYSTEM FAILURE
Trading through an electronic trading or order routing system exposes you to risks associated with system or component failure. In the
event of system or component failure, it is possible that for a certain time period, you may not be able to enter new orders, execute
existing orders, or modify or cancel orders that were previously entered. System or component failure may also result in loss of orders or
order priority.
SIMULTANEOUS OPEN OUTCRY PIT AND ELECTRONIC TRADING
Some contracts offered on an electronic trading system may be traded electronically and through open outcry during the same trading
hours. You should review the rules and regulations of the exchange offering the system and/or listing the contract to determine how orders
that do not designate a particular process will be executed.
LIMITATION OF LIABILITY
Exchanges offering an electronic trading or order routing system and/or listing the contract may have adopted rules to limit their liability,
the liability of FCMs, and software and communication system vendors and the amount of damages you may collect for system failure
and delays. These limitations of liability provisions vary among the exchanges. You should consult the rules and regulations of the
relevant exchange(s) in order to understand these liability limitations.
Each exchange’s relevant rules are available upon request from the industry professional with whom you have an account. Some
exchange’s relevant rules also are available on the exchange’s internet home page.
✔I/we acknowledge that I/we have read and understand the foregoing and intend to rely upon it and that I/we intend to be bound thereby.
I/we understand and agree that my/our electronic signature is the equivalent of a manual signature and that Tradovate may rely upon it as
such.
Name chao-xin yu
User Id lovetienwu ID: 770161182
Datetime Signed Apr 16, 2025, 7:39:11 PM
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Customer Advisory: Understand the Risks of Virtual Currency Trading
The U.S. Commodity Futures Trading Commission (CFTC) is issuing this customer advisory to inform the public of possible risks
associated with investing or speculating in virtual currencies or recently launched Bitcoin futures and options.
Virtual currency is a digital representation of value that functions as a medium of exchange, a unit of account, or a store of value, but it
does not have legal tender status. Virtual currencies are sometimes exchanged for U.S. dollars or other currencies around the world, but
they are not currently backed nor supported by any government or central bank. Their value is completely derived by market forces of
supply and demand, and they are more volatile than traditional fiat currencies. Profits and losses related to this volatility are amplified in
margined futures contracts.
For hedgers – those who own Bitcoin or other virtual currencies and who are looking to protect themselves against potential losses or
looking to buy virtual currencies at some point in the future – futures contracts and options are intended to provide protection against this
volatility. However, like all futures products, speculating in these markets should be considered a high-risk transaction.
What makes virtual currency risky?
Purchasing virtual currencies on the cash market – spending dollars to purchase Bitcoin for your personal wallet, for example – comes
with a number of risks, including:
- most cash markets are not regulated or supervised by a government agency;
- platforms in the cash market may lack critical system safeguards, including customer protections;
- volatile cash market price swings or flash crashes;
- cash market manipulation;
- cyber risks, such as hacking customer wallets; and/or
- platforms selling from their own accounts and putting customers at an unfair disadvantage.
It’s also important to note that market changes that affect the cash market price of a virtual currency may ultimately affect the price of
virtual currency futures and options.
When customers purchase a virtual currency-based futures contract, they may not be entitled to receive the actual virtual
currency, depending on the particular contract. Under most futures contracts currently being offered, customers are buying the right to
receive or pay the amount of an underlying commodity value in dollars at some point in the future. Such futures contracts are said to be
“cash settled.” Customers will pay or receive (depending on which side of the contract they have taken – long or short) the dollar
equivalent of the virtual currency based on an index or auction price specified in the contract. Thus, customers should inform themselves
as to how the index or auction prices used to settle the contract are determined.
Bitcoin is a Commodity
Bitcoin and other virtual currencies have been determined to be commodities under the Commodity Exchange Act (CEA). The
Commission primarily regulates commodity derivatives contracts that are based on underlying commodities. While its regulatory
oversight authority over commodity cash markets is limited, the CFTC maintains general anti-fraud and manipulation enforcement
authority over virtual currency cash markets as a commodity in interstate commerce.
Entering into futures contracts through leveraged accounts can amplify the risks of trading the product. Typically, participants
only fund futures contracts at a fraction of the underlying commodity price when using a margin account. This creates “leverage,” and
leverage amplifies the underlying risk, making a change in the cash price even more significant. When prices move in the customers’
favor, leverage provides them with more profit for a relatively small investment. But, when markets go against customers’ positions, they
will be forced to refill their margin accounts or close out their positions, and in the end may lose more than their initial investments.
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Beware of related fraud
Virtual currencies are commonly targeted by hackers and criminals who commit fraud. There is no assurance of recourse if your virtual
currency is stolen. Be careful how and where you store your virtual currency. The CFTC has received complaints about virtual currency
exchange scams, as well as Ponzi and “pyramid” schemes.
If you decide to buy virtual currencies or derivatives based on them, remember these tips:
- If someone tries to sell you an investment in options or futures on virtual currencies, including Bitcoin, verify they are registered
with the CFTC. Visit SmartCheck.gov to check registrations or learn more about common investment frauds.
- Remember—much of the virtual currency cash market operates through Internet-based trading platforms that may be
unregulated and unsupervised.
- Do not invest in products or strategies you do not understand.
- Be sure you understand the risks and how the product can lose money, as well as the likelihood of loss. Only speculate with
money you can afford to lose.
- There is no such thing as a guaranteed investment or trading strategy. If someone tells you there is no risk of losing money, do
not invest.
- Investors should conduct extensive research into the legitimacy of virtual currency platforms and digital wallets before
providing credit card information, wiring money, or offering sensitive personal information.
- The SEC has also warned that some token sales or initial coin offerings (ICOs) can be used to improperly entice investors with
promises of high returns.
If you believe you may have been the victim of fraud, or to report suspicious activity, contact us at 866.366.2382 or visit
CFTC.gov/TipOrComplaint
See https://www.sec.gov/oiea/investor-alerts-and-bulletins/ib_coinofferings. The CFTC has provided this information as a service to
investors.It is neither a legal interpretation nor a statement of CFTC policy.If you have questions concerning the meaning or application of
a particular law or rule, consult an attorney.
✔I/we acknowledge that I/we have read and understand the foregoing and intend to rely upon it and that I/we intend to be bound thereby.
I/we understand and agree that my/our electronic signature is the equivalent of a manual signature and that Tradovate may rely upon it as
such.
Name chao-xin yu
User Id lovetienwu ID: 770161182
Datetime Signed Apr 16, 2025, 7:39:11 PM
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NFA Investor Advisory—Futures on Virtual Currencies Including Bitcoin
December 1, 2017
The purpose of this investor advisory is to remind investors that, just like any other speculative investment, trading futures on virtual
currencies, including Bitcoin, have certain benefits and various risks.While futures on virtual currencies must be traded on regulated
futures exchanges, trading these products involves a high level of risk and may not be suitable for all investors.It is critical, therefore, for
investors who are considering trading virtual currency futures to educate themselves about these products, understand their risks, and
conduct due diligence before making investment decisions. Investor protection begins with investor education.
- Conduct due diligence on any individuals and firms soliciting for an investment in futures on virtual currencies including Bitcoin
by checking their Commodity Futures Trading Commission(CFTC) registration status, NFA membership status, and background
using NFA's BASIC system or calling NFA's Information Center at 800 - 621 - 3570.
- Virtual currencies including Bitcoin experience significant price volatility, and fluctuations in the underlying virtual currency's
value between the time you place a trade for a virtual currency futures contract and the time you attempt to liquidate it will affect
the value of your futures contract and the potential profit and losses related to it.Be very cautious and monitor any investment that
you make.
- Be aware of sales pitches offering investment schemes that promise significant returns with little risk or that encourage you to "act
now." If an investment sounds too good to be true(e.g., high returns, guaranteed to perform in a certain way), then it probably is.
- Virtual currency futures contracts are bought and sold using initial margin money that can enable you to hold a virtual currency
futures contract valued more than your initial investment.This is referred to as leverage. If the price of the futures contract moves
in an unfavorable direction, the leveraged nature of the futures investment can produce large losses in relation to your initial
investment.In fact, even a small move against your position may result in a large loss, including the loss of your entire initial
deposit, and you may be liable for additional losses.
- Be aware of the risk of Ponzi scheme operators and fraudsters seeking to capitalize on the current attention focused on virtual
currencies, including Bitcoin.
Outlined above are just some of the risks associated with trading futures on virtual currencies, including Bitcoin. Investors should consult
the risk disclosures provided by their FCM and fully educate themselves on all of the associated risks before trading.
With CFTC oversight, each futures exchange listing a virtual currency futures contract is responsible for regulating its futures
market.NFA performs market regulation services on behalf of certain futures exchanges and swap execution facilities.Please be aware,
however, that just because futures on virtual currencies, including Bitcoin, must be traded on regulated futures exchanges does not mean
that the underlying virtual currency markets are regulated in any manner, and as discussed above what occurs in a virtual currency's
underlying market will impact the price of a virtual currency's futures contract.
Investors with questions or concerns regarding trading futures on virtual currencies including Bitcoin should contact NFA's Information
Center (312-781-1410 or 800-621-3570 or [email protected]).
© 2020 National Futures Association. All Rights Reserved. NFA and NATIONAL FUTURES ASSOCIATION are registered trademarks
of National Futures Association.
✔I/we acknowledge that I/we have read and understand the foregoing and intend to rely upon it and that I/we intend to be bound thereby.
I/we understand and agree that my/our electronic signature is the equivalent of a manual signature and that Tradovate may rely upon it as
such.
Name chao-xin yu
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User Id lovetienwu ID: 770161182
Datetime Signed Apr 16, 2025, 7:39:11 PM
Submitted By: lovetienwu Apr 9, 2025, 2:13:27 PM Page 9 of 11
