Registering as a CTA with the NFA

Discussion in 'Classifieds' started by cooltraderabhi, Apr 29, 2012.

  1. Hi - how much time does it take to register as a CTA with the NFA?
  2. theshrink


    It really depends on how long it takes you to put together your disclosure documents and all the paperwork, and how well you do it the first time (i.e. how much does it have to get rewritten, etc.) If you follow all the instructions carefully, you can probably get it all done and get approved in a couple of months.
  3. Forever. Not only do you have to complete a disclosure document, which is way longer than a part II ADV, but you also must register with your State Division of Securities and that process is endless.

    I don't even worry about the test, because most people if they want to become CTA's will pass it anyway. How you handle writing your disclosure document depends on whether you understand the market, as nobody signs up if you have no real results, so producing hypotheticals is worthless. Not only must it be clearly marked as hypothetical, but investors don't rely on those figures at all.

    You'll need to begin trading for your CTA with enough capital so that you aren't undercapitalized, and if you don't have any clients now, there's really no point to registering. Go to and post your client results to,,,, and maybe somebody will call you when you get a decent enough track record.

    Basically, until you've registered your CTA, passed the tests, then traded for 3 months, only then can you introduce proprietary results and if you don't have any clients and prop is all you have to show, it becomes even more arduous because you will have to add a disclaimer to proprietary performance as well. Basically, if you have no clients but want to get into the business, wait to write your disclosure document until after you've traded as a CTA for 3 months.

    A couple months is unrealistic, but if you have proprietary results you should be able to post them after 3 months of performance as a CTA, so I guess that's the fastest possible route.
  4. Do we have to register with the State Division of Securities? Never heard of that before...
  5. theshrink


    If your question is just how long does it take to register, it can easily be done in a couple of months, I know a few years ago, I managed in about 4 weeks, and I know people who have done it recently in about that amount of time. There is even boilerplate language for your disclosure document, including the proprietary results section, and the NFA is generally happy to walk you through it. If you use exactly their language, particularly regarding risk, the process is MUCH simpler and faster than if you try and paraphrase. They have a 2 week expectation for returning your documents with approval or needed changes, so that really doesn't take too long, especially if you call them with your questions before submitting everything. As the previous poster said, there is a lot more to becoming a successful CTA, but the registration itself is pretty straightforward.
  6. theshrink


    Under rule Rule 3a43-1(b), CTA's do not generally have to register with securities regulators unless they are involved in securities transactions rather than futures-only.
  7. heech


    I'd second the 4-8 week number. It took my attorney about 4 weeks to get all the paperwork completed and submitted for my CPO (including LLC management company, LP, state-based blue sky filings)... And that includes a 1 week delay because my fingerprints kept coming back as illegible. Another 2-3 weeks to iron out kinks with NFA, 1-2 weeks to get third party admin agreement + partnership bank account established.