Release: 5146-05
For Release: December 20, 2005

CFTC Issues Consumer Advisory Warning About Promises of Easy Profits from Commodity Futures and Options Trading Based on Seasonal Demand and Other Well-Known Public Information

WASHINGTON, DC -- The Commodity Futures Trading Commission (CFTC) issued a Consumer Advisory, Beware Of Promises of Easy Profits from Commodity Trading Based on Seasonal Demand and Other Well-Known Public Information. The Advisory warns consumers to watch out for possibly fraudulent claims that profits on commodity futures or options trading can be made as a result of changes in the prices of physical commodities based on seasonal weather patterns or other well-known events.

In the wake of recent increases in the prices of unleaded gasoline, heating oil, and natural gas, the Consumer Advisory points out that “Just because the price you pay for heating oil or natural gas is rising does not mean that the price of heating oil or natural gas futures and options prices will also rise.” The Advisory explains that seasonal fluctuations in prices of commodities are well known by traders in the futures and options markets and already reflected in their prices.

In the Advisory, the CFTC warns about sales pitches that base futures or options trading recommendations on the occurrence of well-publicized events such as weather events, political unrest, published reports, and market disruptions. These pitches are most likely fraudulent, according to the CFTC.

The CFTC encourages the public to bring any incidents of fraudulent pitches to its attention by calling its toll-free Consumer Hotline at 1-866-FON-CFTC (1-866-366-2382), emailing the Commission’s Division of Enforcement at [email protected], or visiting the CFTC's Consumer Protection web page. The staff who receive these calls and emails will quickly respond to any concerns or questions that you may have.

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Related Document
CFTC Consumer Advisory on Seasonal Demand and Other Well-Known Public Information