Introduction to Clearing and Settlement
Clearing and settlement directly follows a trade. Clearing is what comes immediately after the trade, where all the terms of the deal are double-checked. Settlement is the final stage, in which the transfer of securities and money takes place. In this video, Peter briefly explains how these key processes in a securities transaction are achieved.
Overview
The clearing and settlement of securities takes place after a trade. Ideally, all the terms of the deal are verified without error in the clearing stage and settlement takes place via delivery versus payment (DVP), so that payment and delivery of the security occurs simultaneously.
Key learning objectives:
Explain clearing and settlement
Describe the terms of a deal that are reviewed at the clearing stage
Define DVP and explain when this takes place
Summary
Expert
Peter Eisenhardt
Peter has over 30 years experience working in banking. He has held several senior positions in international investment banks. Peter is now the Secretary General of the International Council of Securities Associations
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