Introducing broker (IB)
An introducing broker (IB) is a firm that solicits or accepts futures orders from customers but does not accept their money or extend them credit: the account and the funds sit at a futures commission merchant, to which the IB introduces the customer. Many retail futures brokers operate this way.
Senzoukria · Glossary · Updated September 2026
Definition
The CFTC glossary defines an introducing broker as a person who solicits or accepts orders for the purchase or sale of any commodity for future delivery on or subject to the rules of any exchange but who does not accept payment from or extend credit to those whose orders are accepted. The funds go to the carrying futures commission merchant.
How the relationship works
- The IB acquires and serves the customer: onboarding, platform choice, support, sometimes pricing.
- The FCM carries the account: it holds the funds, applies margin and risk rules, clears the trades and issues statements.
- Commissions are often shared between the two under their agreement.
- Some IBs are guaranteed by one FCM; others can introduce to several.
Why it matters to a trader
When something goes wrong, knowing who does what saves time. A margin or statement question belongs to the FCM; a platform or data subscription question may belong to the IB or to the vendor. Two customers of the same IB can even sit at different FCMs, with different house margins and fee schedules.
Counting the layers in a typical retail setup: IB, FCM, clearing member, exchange, clearing house, plus the software vendor, six parties for one order, even when the customer only ever speaks to the first.
In Senzoukria
Rithmic accounts expose an IB id next to the account id and the FCM id. The application passes all three when it starts an account feed and when it places, modifies or cancels an order, because the order plant identifies the account by that combination. The IB id is an identifier the broker's system provides; the application does not interpret it.
Common mistakes
- Sending funds to an entity that is not the carrying FCM.
- Assuming the IB can change margin rules that belong to the FCM.
Related
In the same section
- Iron condor
- Intrinsic value
- Isolated vs cross margin
- Intrabar delta
- IV rank vs IV percentile
- Intrabar ambiguity
- Kelly criterion
- Intercommodity spread
Sources
- CFTC glossary (2026-09-25)
This page in other languages
Frequently asked questions
- Does an introducing broker hold my money?
- No. By definition an IB does not accept customer funds. Deposits go to the futures commission merchant that carries the account.
- Why does my Rithmic account show an IB id?
- Because the routing system identifies an account by the combination of account, FCM and introducing broker identifiers. Software connecting to the account must present all three with each order.