About the Firm: How did you get started? Do you provide additional services besides brokerage
I’ve always had a focus in the energy markets. The Dow Energy Corp. was founded in 1986 as a GIB of Gelderman. After becoming an IIB, it merged with CitiBank in 1991 to form CitiBank Futures Group, the first US bank to clear third party futures and options. I founded The Dow Corporation in 1995 while a member of the NYMEX, and developed Dow Vector Analysis, a proprietary trading system.
Currently, The Dow Corp. is structured as a vertical information and service company, introducing commercial energy business to eight FCMs.
What are the biggest challenges your clients face today, and how do you help them?
Globalization and creation of new markets at warp speed can create new challenges for clients. We put forth considerable effort to keep our clients abreast of these changes, while keeping them informed of legislation being put forth by Washington. Currently, our biggest challenge is in the area of proposed regulations. We are working to understanding how the Dodd-Frank Bill will affect our clients and the way they do business.
How has the futures and options industry evolved since you first started in business?
In 1979, when I started in the futures and options industry, it was rather foot-loose and fancy-free. But regulation, which was created primarily to rein-in wrongdoers and those who bend the rules, has been imposed on the entire industry, resulting in wide, and I believe, unintended consequences on everyone trading. I think this is true for both CFTC and NFA regulation.
What do you believe to be the keys to your success?
Forward thinking, along with honesty, integrity and tenacity. It’s not the easiest business to be involved in, but to me, it is certainly one of the most rewarding. There are no limits to your potential success. In order to survive and grow through the years, one must always be thinking, what are the expectations? Also, surrounding yourself among like-minded people who share the same vales and work ethic will take you far.
What trends are you most excited about/worried about?
This is a very exciting time to be in the commodity industry. Currently, commodities are at the forefront and they will continue to grow driven in large degree to the emerging markets of Eastern Europe, Latin America and Asia and the constant demand for raw commodities.
There are always concerns to be had. The growth of social media and the Internet allow for an inordinate amount of information to be exchanged rapidly. Keeping up with the new contracts being added to the multiple exchanges creates its own challenges. The Dow Corporation believes that we are currently heading into a wave of over regulation in our industry; this will undoubtedly pose new challenges to come. Yet, the most disturbing trend is the commercial users of the futures industry pounding down commission rates. It makes it difficult to be profitable when FCM compete against us for business by discounting clearing rates; it’s a fool’s game. Exchanges fees are disproportionately high compared to clearing fees.
Why did you become a member of the NIBA?
I feel that it is important to have a voice in our industry to advocate the vital role that both the guaranteed and the independent Introducing Brokers provide. FCMs no longer provide quality value-added services, partially due to the low clearing rates in the commercial sector. For us, NIBA helps to fill that gap. It provides representation, both in Washington and at the NFA, information and peer networking that we can use to create more business.
Learn more about Dow Corp by visiting: www.thedowcorp.com
Contact Rodney Dow: Rodney@thedowcorp.com
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