What are security futures?
As their name suggests, security futures are financial instruments that are both securities and futures. There are two types of security futures: futures on individual securities and futures on narrow-based security indexes. Security futures may be traded on a variety of facilities, including registered securities and futures exchanges and derivative transaction execution facilities, as well as alternative trading systems.
How are security futures products regulated?
These products are regulated jointly by the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) and may be offered and sold by certain registrants with the SEC and CFTC.
Are there any types of products that are not included in the definition of security futures?
Security futures do not include futures on broad-based stock indices, such as the Dow Jones Industrial Average, the Nasdaq indexes, the NYSE Composite, and the S&P 500 that currently trade on futures exchanges. These broad-based index futures, the first of which began trading in 1982, remain futures products under the exclusive jurisdiction of the CFTC, and they may be sold only by CFTC registrants who have passed the Series 3 or Series 33 examinations.
Who is eligible to take this or a similar training program?
The training program you are about to take is designed for persons who have completed the Series 7 (General Securities Representative) and/or the Series 3 (National Commodity Futures) examinations. In the future, material on security futures will be included in futures and securities industry proficiency exams. This continuing education program focuses on essential information that persons offering and selling security futures, and those who supervise such persons, should know in order to comply with the applicable federal and self-regulatory organizations (SROs) requirements.
Does this training program permit me to offer a full range of securities and futures products to my clients?
This training focuses on the institutions and regulatory requirements of the securities and futures industries that are most relevant for security futures. Because this continuing education program does not encompass all aspects of securities and futures covered in the Series 7 and Series 3 examinations, this training does not qualify the participant to engage in the array of activities that persons who have completed the Series 7 and/or Series 3 examinations are permitted to undertake.
Can I begin offering these products to my clients and then take the training class?
No. No registrant can offer security futures products without having first taken an appropriate training program.
What is covered in the training program?
This training material is divided into five modules:
- Stocks and Stock Options (Module 1)
- Futures (Module 2)
- Security Futures (Module 3)
- Regulatory Requirements for Security Futures (Module 4)
- Supervision of the Offer and Sale of Security Futures (Module 5)
All of the modules contain brief question and answer sections designed to help reinforce the material in this training program; several modules also contain numerical exercises.
Which modules am I required to take?
- All registrants must take Modules 3 and 4.
- Series 3 registrants who are not also Series 7 or Series 42 registrants must take Module 1, Stocks and Stock Options. Each firm will determine whether such persons are required to take Module 2, Futures Contracts.
- Series 7 or Series 42 registrants who are not also Series 3 or Series 33 registrants must take Module 2, Futures Contracts. Each firm will determine whether such persons are required to take Module 1, Stocks and Stock Options.
- If you are a Series 7 or Series 42 and a Series 3 or Series 33 registrant, your firm will determine whether you are required to take either of Modules 1 or 2.
- Module 5 is required for persons seeking to function as security futures principals.
How long will it take me to complete this training program?
The average time to complete Modules 1 or 2 and Modules 3 and 4 is estimated to be 2 hours. Module 5 will take an additional 20 minutes.
What types of system requirements and settings do I need to have?
National Futures Association web-based applications require a currently supported version of Microsoft Internet Explorer or Firefox. NFA recommends keeping browser levels and maintenance current as an overall best practice.Internet Explorer updates are available at:
Firefox updates are available at:
When can I access the training modules?
The training modules are not available for use from 8:00 PM to 9:00 PM CT from Monday through Friday. The system may also occasionally be unavailable at other times due to system maintenance.
Who do I call if I have questions or problems?
Contact NFAs Information Center at 1-800-621-3570 between 8:00 and 5:00 Central Time. You may also e-mail your inquiry to [email protected]
What records does my firm have to keep of this training class?
No one is able to offer security futures to the public unless they have completed a training program, and a firm has a duty to be able to demonstrate compliance with this restriction. Therefore, the firm must create some sort of recordkeeping system to show that its registered representatives and APs have completed a program. Once you have completed this program, you can print a certificate of completion that you can provide to your compliance department.
What if I don't know or lost my NFA ID number or my sponsor's NFA ID number?
NFA ID numbers for both firms and individuals can be found by conducting a name search in NFAs BASIC system. Click here to connect to BASIC.
What happens if I make a mistake in entering my NFA ID number?
NFA and your employer will not be able to verify that you completed the training. You will have to exit the training and start again using the correct number.
What is an SFP ID number and why do I need one?
An SFP ID number is a unique ID number used to track the individuals progress through the training. It enables you to resume your training from the last point you have saved. Therefore, it is important that you keep your SFP ID number.
What if I lost my SFP ID number?
If you have lost your SFP ID number, you can contact NFAs Information Center at 1-800-621-3570 between 8:00 and 5:00 Central Time. You may also e-mail your inquiry to [email protected]
How long is my SFP ID number good for?
The SFP ID number does not expire. You can complete the training at your convenience and, after the training is completed, you can reenter the system to print out another certificate. Remember, however, that you cannot engage in a security futures business until your firm has determined that you have completed all of the necessary modules of the training program.
What happens to the work that I have completed if I leave the system before I complete all of the modules?
As long as you have saved your progress by clicking the SAVE PROGRESS button at the top of the screen, you can resume the training where you were when you exited the training. When you resume the training, you will be asked for the SFP ID number. If you did not save your progress before you exited, you must start incomplete modules at the beginning.
Will I get timed out?
The training system will not time you out. However, your systems administrator may set security to time you out of the network you are using to access the training system.
How long do I need to keep the record (certificate) of completion?
You should maintain the record of completion for as long as you offer security futures products to your customers.
Do I need to give the certificate to my employer?
Your employer may require that you provide a copy of the certificate because it must maintain proof that you have taken the online training for security futures products. Keeping a copy of the certificate is one way to demonstrate compliance with the requirement.
Does NFA keep a record of who completed the modules?
Yes. NFA maintains a record of everyone who has taken the SFP training.
