RISK DISCLOSURE STATEMENT THAT MUST BE FURNISHED BY A COMMODITY TRADING ADVISER
1. This statement is provided to you in accordance with section 32(3) of the Commodity Trading Act.
2. The intention of this statement is to inform you that the risk of loss of trading in commodity contracts can be substantial. You should therefore carefully consider whether such trading is suitable for you in light of your financial condition.
3. In considering whether to trade or to authorise someone else to trade for you, you should be aware of the following:
(a)
if you purchase or sell a commodity contract, you may sustain a total loss of the initial margin funds and any additional funds that you deposit with your broker to establish or maintain your position. 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 prescribed time, your position may be liquidated at a loss, and you will be liable for any resulting deficit in your account;
(b)
under certain market conditions, you may find it difficult or impossible to liquidate a position;
(c)
the placement of contingent orders by you or your commodity trading adviser such as a “stop‑loss” or “stop‑limit” order, will not necessarily limit your losses to the intended amounts, since market conditions may make it difficult or impossible to execute such orders;
(d)
a “spread” position may not be less risky than a simple “long” or “short” position;
(e)
the high degree of leverage that is often obtainable in commodity contract can work against you as well as for you. The use of leverage can lead to large losses as well as gains;
(f)
in some cases, managed accounts, such as yours, are subject to substantial charges for management and advisory fees. It may be necessary for those accounts that are subject to these charges to make substantial trading profits to avoid depletion or exhaustion of their assets;
(g)
this brief statement cannot disclose all the risks and other significant aspects of the commodity markets. You should therefore carefully study trading in commodity contracts before you trade; and
(h)
a commodity trading adviser is prohibited from accepting funds in the adviser’s name from a client for trading in commodity contracts. You must place all funds for trading directly with a commodity broker or a bank account in your name.
ACKNOWLEDGMENT OF RECEIPT OF THIS RISK DISCLOSURE STATEMENT
This acknowledges that I have received a copy of the RISK DISCLOSURE STATEMENT and understand its contents.
Signature:_______________________
Full Name:______________________
Date:___________________________
[S 100/2008 wef 27/02/2008]
FORM 2
Regulations 19(3) and 26(1) and (3)
COMMODITY TRADING ACT
(CHAPTER 48A)
COMMODITY TRADING REGULATIONS
RISK DISCLOSURE STATEMENT THAT MUST BE PROVIDED TO PARTICIPANTS IN A COMMODITY POOL
1. This statement is provided in accordance with section 32(2) of the Commodity Trading Act.
2. The intention of this statement is to inform you that the risk of loss in trading in commodity contracts can be substantial. You should therefore carefully consider whether your financial condition permits you to participate in a commodity pool. You may lose a substantial portion or even all of the money you place in the pool.
3. In considering whether to participate in a commodity pool, you should be aware that trading in commodity contracts can quickly lead to large losses as well as gains. Such trading losses can sharply reduce the net asset value of the pool and consequently the value of your interest in the pool. Also, market conditions may make it difficult or impossible for the pool to liquidate a position.
4. In some cases, commodity pools are subject to substantial charges for management, advisory and brokerage fees. It may be necessary for those pools that are subject to these charges to make substantial trading profits to avoid depletion or exhaustion of their assets.
5. Foreign markets transactions may be carried out. Funds placed with a commodity pool operator for the purpose of participating in foreign markets, such as __________ or __________ transactions, may not enjoy the same level of protection as funds placed for the purpose of margining commodity contracts traded in commodity markets located in Singapore.
6. This brief statement cannot disclose all the risks and other significant aspects of participating in a commodity pool. You should therefore carefully study commodity trading before you decide to participate in a commodity pool.
Note:
If the potential liability of a participant in the pool is greater than the amount of the participant’s contribution for the purchase of an interest in the pool and profits earned thereon, whether distributed or not, the pool operator must make the additional following statement in the Risk Disclosure Statement, to be prominently disclosed as the last paragraph thereof:
“Also, before you decide to participate in this pool, you should note that your potential liability as a participant in this pool for trading losses and other expenses of the pool is not limited to the amount of your contribution for the purchase of an interest in the pool and any profits earned thereon. A complete description of the liability of a participant in this pool is explained more fully in the Disclosure Document provided to you by the pool operator.”.
ACKNOWLEDGMENT OF RECEIPT OF THIS RISK DISCLOSURE STATEMENT
This acknowledges that I have received a copy of the RISK DISCLOSURE STATEMENT and understand its contents.
Signature:_______________________
Full Name:______________________
Date:___________________________
[S 100/2008 wef 27/02/2008]
FORM 3
Regulation 28(7)
COMMODITY TRADING ACT
(CHAPTER 48A)
COMMODITY TRADING REGULATIONS
RISK DISCLOSURE STATEMENT REQUIRED TO BE FURNISHED BY A COMMODITY BROKER OR SPOT COMMODITY BROKER
1. This statement is provided to you in accordance with section 32(1) of the Commodity Trading Act.
2. The intention of this statement is to inform you that the risk of loss in trading in commodity contracts and in spot commodity contracts can be substantial. You should therefore carefully consider whether such trading is suitable for you in light of your financial condition.
3. In considering whether to trade, you should be aware of the following:
(a)
Margin: You may sustain a total loss of the initial margin and any additional margins that you deposit to establish a position or maintain positions in the commodity market or spot commodity market. If the market moves against your positions, you may be called upon to deposit a substantial amount of additional margins, on short notice, in order to maintain your positions. If you do not provide the required margins within the prescribed time, your positions may be liquidated at a loss, and you will be liable for any resulting deficit in your account.
(b)
Liquidation of position: Under certain market conditions, you may find it difficult or impossible to liquidate a position.
(c)
Contingent orders: Placing contingent orders, such as “stop‑loss” or “stop‑limit” order, will not necessarily limit your losses to the intended amounts, since market conditions may make it impossible to execute such orders.
(d)
“Spread” position: A “spread” position may not be less risky than a simple “long” or “short” position.
(e)
Leverage: The high degree of leverage that is often obtainable trading in commodity contracts and spot commodity trading because of the small margin requirements can work against you as well as for you. The use of leverage can lead to large losses as well as gains.
(f)
Foreign markets transactions: Funds placed with a commodity broker or spot commodity broker for the purpose of participating in foreign markets, such as _________________________ or _________________________ transactions, may not enjoy the same level of protection as funds placed in commodity markets located in Singapore.
4. This brief statement cannot disclose all the risks and other significant aspects of the commodity market. You should therefore carefully study trading in commodity contracts and spot commodity trading before you trade.
ACKNOWLEDGMENT OF RECEIPT OF THIS RISK DISCLOSURE STATEMENT
This acknowledges that I received a copy of the RISK DISCLOSURE STATEMENT and understand its contents.