Break-Even Point Law and Legal Definition

According to 17 CFR 4.10 [Title 17 Commodity and Securities Exchanges; Chapter I Commodity Futures Trading Commission; Part 4 Commodity Pool Operators and Commodity Trading Advisors], break-even point (1) means the trading profit that a pool must realize in the first year of a participant's investment to equal all fees and expenses such that such participant will recoup its initial investment, as calculated pursuant to rules promulgated by a registered futures association; and

(2) Must be expressed both as a dollar amount and as a percentage of the minimum unit of initial investment and assume redemption of the initial investment at the end of the first year of investment.