Futures commission merchant (FCM)
A futures commission merchant (FCM) is the firm that accepts customers' futures orders and holds their funds: it opens the account, collects margin, carries the positions through a clearing member and sends the statements. When a platform or prop firm connects you to CME futures, an FCM stands somewhere behind the account.
Senzoukria · Glossary · Updated September 2026
Definition
The CFTC glossary defines FCMs as individuals, associations, partnerships, corporations and trusts that solicit or accept orders for the purchase or sale of any commodity for future delivery. In practice an FCM is the regulated firm that holds customer money for futures trading and is responsible for the account, the risk checks and the reporting.
What an FCM does
- Holds customer funds, which CFTC rules require to be kept segregated from the firm's own money.
- Sets house margin requirements at or above the clearing house minimums.
- Runs pre-trade and post-trade risk controls on its customers' orders.
- Clears trades itself if it is a clearing member, or through another clearing firm if not.
- Issues statements showing positions, fees and daily settlement flows.
FCM, introducing broker and platform
Several parties can stand between a trader and the exchange. The introducing broker brings the customer and may handle service, but does not hold funds. The FCM holds the account. The platform or API vendor carries orders and market data between the trader's software and the FCM's systems. A prop firm's account also sits within such a chain, with the firm, not the trader, as the FCM's customer or partner.
A simple count for one retail order: trader's software, API vendor, FCM, clearing member (possibly the same firm), exchange and clearing house, so at least four and up to six parties.
In Senzoukria
On a Rithmic connection each account is identified by an account id together with an FCM id and an IB id. The application starts the account feed with those three values, sends them with every order, and resolves a trade route per FCM and exchange before routing anything; until the route for the order's exchange is known, the order is refused with the message that no trade route is resolved yet. Switching the active account restarts the feed so that orders route to the account the screen shows.
Common mistakes
- Assuming the platform vendor holds your money.
- Not knowing which FCM carries an account, which is where statements, margin rules and fees come from.
Related
In the same section
- Futures contract
- Futures basis
- Month codes
- Funding rate
- Futures symbology
- Funded account
- Trading stack
- Front month
Sources
- CFTC glossary (2026-09-25)
This page in other languages
Frequently asked questions
- Is Rithmic an FCM?
- Rithmic is a market data and order routing technology provider. Accounts that connect through it are carried by an FCM, whose identifier appears alongside the account on the Rithmic connection.
- How can I check that a futures firm is registered?
- US futures firms and their principals register with the CFTC through the National Futures Association, whose public registration lookup shows a firm's status and history.