7.4. Regulation of Commodity Pools and CPOs

A commodity pool may be structured in a variety of ways. It may be a general partnership, where investors’ liabilities can exceed their investments should the pool receive substantial losses. More commonly, however, it is organized as a limited partnership or a limited liability company. In a limited partnership, the commodity pool operator (CPO) acts as the general partner, and the individual investors are the limited partners. In a limited liability company, the CPO is the managing owner, and the other owners are called members. In both instances, the limited partners or members can never lose more than the amount of funds they cont