HedgeStreet Exchange FAQs - What Is HedgeStreet?

HedgeStreet is the first person-to-person online market where traders can hedge or speculate on economic outcomes. HedgeStreet is subject to regulatory oversight by the Commodity Futures Trading Commission (CFTC).

How does HedgeStreet work?

HedgeStreet lists unique financial contracts, called Binaries and Bungees, and offers access to all traders. Traders can apply for membership online, and once approved, can trade contracts with other HedgeStreet members.

What makes HedgeStreet different from other forms of financial trading?

Many of the unique financial contracts traded on HedgeStreet do not exist on any other financial market. HedgeStreet also offers small contract sizes and fees, enabling traders both large and small to participate.

How are markets made on HedgeStreet?

HedgeStreet's markets are made by traders who buy and sell contracts by placing bids and offers for other traders to fill. HedgeStreet facilitates trades, but never takes positions for itself.

How does HedgeStreet fit in my investment portfolio?

HedgeStreet can be used to hedge or speculate on price movements in forex, commodity, and equity index markets. For example, if you have insight into the direction of gold prices, you might want to buy Gold contracts to speculate on your insights.

Is HedgeStreet regulated?

HedgeStreet is subject to regulatory oversight by the Commodity Futures Trading Commission (CFTC). The mission of the CFTC is to protect market users and the public from fraud, manipulation, and abusive practices related to the sale of commodity and financial futures and options, and to foster open, competitive, and financially sound futures and option markets. Congress created the CFTC in 1974 as an independent agency with the mandate to regulate commodity futures and option markets in the United States.

Who is responsible for monitoring the day-to-day compliance of HedgeStreet's transactions and the market as a whole?

HedgeStreet has an internal Compliance department that is responsible for daily compliance oversight.

In addition, HedgeStreet has retained The National Futures Association (NFA), the premier independent provider of regulatory programs that safeguard the integrity of the derivatives markets, to assist with the surveillance of the HedgeStreet market - including conducting trade practice and market surveillance on trading and order data, reviewing data for any trade or market inconsistencies or exceptions, and notifying HedgeStreet if any investigation is warranted. For more information, please visit www.nfa.futures.org.

How does HedgeStreet clear?

HedgeStreet is registered as a Derivative Clearing Organization (DCO) and clears all its trades through an end-of-day settlement process. Because all of HedgeStreet's financial instruments are "fully-collateralized" prior to trade execution (which is consistent with our order of registration as a DCO) and are cash-settled, the clearing process is simply a series of accounting entries to adjust the instrument and cash positions of the members on the books of HedgeStreet.

How do I know the outcome of my contracts?

Binaries and Bungees are settled after their specified expiration time, at which time the final settlement value for each contract is determined and payouts are made to the appropriate member accounts. Preliminary expiration values are available to members by request shortly after the close of each market. To request these preliminary expiration values, please email customer service at customerservice@hedgestreet.com.

Note: The preliminary expiration values available are ONLY PRELIMINARY ESTIMATES AND ARE NOT FINAL VALUES. HedgeStreet does not warranty the preliminary expiration values in any respect and does not guarantee their accuracy and/or completeness. These values are provided for informational purposes only. They are not final and should not be relied upon by users.

For more information on HedgeStreet, please visit About Us.