With trading directed by an advisor, is the choice of a Futures Commission Merchant (FCM) / Bank still important?
It’s no less important than in any other investment relationship. On a day-today basis, the FCM / Bank may be monitoring and evaluating the advisor’s performance even more closely than you will. In addition, although the advisor directs trading for your account, it is generally your FCM / Bank that will execute the trades, and manage all “back office operations” regarding your account. Thus, it’s important to know you are doing business with a firm that has the resources and skills to compete effectively in today’s markets. Some do, better than others. And intangibly, but by no means least, it’s important to have a high comfort level with the FCM / Bank you’ll be working with.
