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Investment in securities market are subject to market risks. To tell apart between safety futures on slender-primarily based safety indexes, which are jointly regulated by the Commissions, and futures on broad-primarily based safety indexes, that are under the unique jurisdiction of the CFTC,6 the CFMA additionally amended the CEA and the Exchange Act by adding an goal definition of "narrow-primarily based security index." 1. Definition of Narrow-Based Security Index Under the CEA and Exchange Act, an index is a "slender-primarily based security index" if it has any certainly one of the next 4 characteristics: (1) it has nine or fewer component securities; (2) any one among its element securities comprises greater than 30% of its weighting; (3) the 5 highest weighted part securities collectively comprise greater than 60% of its weighting; or (4) the bottom weighted component securities comprising, in the aggregate, 25% of the index's weighting ("lowest weighted 25%") have an aggregate greenback value of average day by day trading volume ("ADTV") of lower than $50 million (or in the case of an index with 15 or more element securities, $30 million).7 Any security index that doesn't have any of the four characteristics set forth above is, in impact, a broad-based security index.
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