What Are the Commitments of Traders (COT) Report?
The Commitment of Traders (COT) report is a weekly publication that shows the aggregate holdings of different participants in the U.S. futures market. Published every Friday by the Commodity Futures Trading Commission (CFTC) at 3:30 E.T., the COT report is a snapshot of the commitment of the classified trading groups as of Tuesday that same week.
Commitments Of Traders (COT) Charts
The Commitment of Traders (COT) reports providing a breakdown of each Tuesday’s open interest for markets in which 20 or more traders hold positions equal to or above the reporting levels established by the CFTC. The commitment of Traders (COT) charts is updated each Friday at 3pm CT.
The Commitment of Traders information is available with both the Disaggregated and Financial Traders Reports.
THE COMMITMENT OF TRADERS (COT) REPORT
Open interest is the total of all futures and options contracts entered into and not yet offset by a transaction, by delivery, by exercise, etc. The aggregate of all long open interest is equal to the sum of all genuine short interest.
Open interest held or controlled by a trader is referred to as that trader's position. For the COT Futures-and-Options-Combined report, genuine option interest and traders' option positions are computed on a futures-equivalent basis using delta factors supplied by the exchanges. Long-call and short-put genuine interest are converted to long futures-equivalent open interest. Likewise, short-call and long-put open interest are converted to short futures-equivalent open interest. For example, a trader holding a long put position of 500 contracts with a delta factor of 0.50 is considered to be having a short futures-equivalent place of 250 contracts. A trader's long and short futures-equivalent jobs are added to the trader's long and short futures positions to give "combined-long" and "combined-short" classes. As reported to the Commission and as used in the COT report, open interest does not include available futures contracts against which notices of deliveries have been stopped by a trader or issued by the clearing organization of an exchange.
Clearing members, futures commission merchants, and foreign brokers (collectively called reporting firms) file daily reports with the Commission. Those reports show traders' futures and option positions that hold positions above specific reporting levels set by CFTC regulations. Suppose at the daily market close; a reporting firm has a trader with a job at or above the Commission's reporting level in any single futures month or option expiration. In that case, it reports that trader's entire working all futures and options expiration months in that commodity, regardless of size. The aggregate of all traders' positions said to the Commission usually represents 70 to 90 percent of the total open interest in any given market. From time to time, the Commission will raise or lower the reporting levels in specific needs to strike a balance between collecting sufficient information to oversee the needs and minimizing the reporting burden on the futures industry.
Commercial and Non-Commercial Traders
When an individual reportable trader is identified to the Commission, the trader is classified as "commercial" or "non-commercial." A trader's reported futures positions in a commodity are classified as commercial if the trader uses futures contracts in that particular commodity for hedging as defined in CFTC Regulation 1.3(z), 17 CFR 1.3(z). A trading entity generally gets classified as a "commercial" trader by filing a statement with the Commission, on CFTC Form 40: Statement of Reporting Trader, that it is commercially "...engaged in business activities hedged by the use of the futures or options markets." To ensure that traders are classified with accuracy and consistency, Commission staff may exercise judgment in re-classifying a trader if it has additional information about the trader's use of the markets. A trader may be classified as a commercial trader in some commodities and a non-commercial trader in others. A single trading entity cannot be classified as both a commercial and non-commercial trader in the same thing. Nonetheless, a multi-functional organization with more than one trading entity may have each classified separately in a commodity. For example, a financial organization trading in financial futures may have a banking entity whose positions are classified as commercial and have a separate money-management entity whose jobs are classified as non-commercial.
The long and short open interest shown as "Non-reportable Positions" is derived by subtracting total long and short "Reportable Positions" from the real genuine interest. Accordingly, for "Nonreportable Positions," the number of traders involved and each trader's commercial/non-commercial classification are unknown.