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Commission House


What does Commission House mean?

A firm which buys and sells only for customer accounts on commission. In futures market, a Commission House is also known as a Futures Commission Merchant (FCM). A commission house solicits, accepts and executes orders to buy or sell futures contracts, options on futures, retail off-exchange forex contracts or swaps. But it does not trade for its own account.

Futures Knowledge Explains Commission House

A commission house gets the order / instruction from the customer for trading of equity, bonds, derivatives, commodities etc. and then executes the transaction. Commission Houses charges a transaction fee for executing such trades from their customers. In return they execute the transaction, make the settlement and also maintain the account of their clients. Over the last few decades they have also built in house research capabilities for providing ideas to their customers. 

 



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