# Understanding Wash Trades

**URL:** <https://community.tradovate.com/t/understanding-wash-trades/2103>\
**Category:** Useful Links\
**Created:** [April 29, 2021, 3:49pm UTC](https://community.tradovate.com/t/understanding-wash-trades/2103 "2021-04-29T15:49:05Z")\
**Posts on this page:** 1\
**Page:** 1

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**Author:** ![BWeis](https://sea1.discourse-cdn.com/flex015/user_avatar/community.tradovate.com/bweis/32/27_2.png) [@BWeis](https://community.tradovate.com/u/BWeis)\
**Post date:** [April 29, 2021, 3:49pm UTC](https://community.tradovate.com/t/understanding-wash-trades/2103/1 "2021-04-29T15:49:05Z")

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Traders are all subject to the same market risk. Negating your risk via wash trades places you in violation of market regulations. Initiating or participating in a wash trade, whether you did know or should have reasonably known is a violation of Rule 534 of the market regulations. Ensure that you are in compliance by knowing the market regulations regarding wash trades.

Useful links in understanding wash trades:  
[https://www.cmegroup.com/rulebook/files/cme-group-Rule-534.pdf](https://www.cmegroup.com/rulebook/files/cme-group-Rule-534.pdf)