clearing house

clearing house
A body through which futures or commodity trading takes place. It monitors transactions and provides a system for financial settlement. For exchange contracts, namely, transactions conducted through clearing houses, the clearing house also acts as an intermediary for all contracts between brokers. Thus, for any purchase by a client, the broker will have an equal and off-setting purchase contract with the clearing house which will in turn have an equal and off-setting purchase contract with another broker. As a result, the clearing house is exposed to a member's insolvency and guards against this by having rules requiring a margin to be paid, and by having the ability to force a member to close out a position by buying and selling futures on its behalf.
USA
An entity that functions as a centralized repository for trades, typically in derivatives, which provides a guaranty that the trade will be fulfilled so that the parties engaging in derivatives trades may avoid assuming the credit risk of their trading counterparties.
Related terms

Practical Law Dictionary. Glossary of UK, US and international legal terms. . 2010.

Игры ⚽ Поможем написать реферат

Look at other dictionaries:

  • Clearing house — may refer to: Clearing house (finance) Clearinghouse (GIS) Clearing House (EU), an EU intelligence body Clearing House, California Railway Clearing House A computer reservations system for an airline Publishers Clearing House Biosafety Clearing… …   Wikipedia

  • Clearing House — Clearing House, Railway Clearing House (Abrechnungsbureau), organisierte Vereinigung der Bahnen Großbritanniens mit dem Sitz in London zur Schaffung von Erleichterungen für den durchgehenden Verkehr, insbesondere zur Abrechnung der… …   Enzyklopädie des Eisenbahnwesens

  • clearing house — clearing houses also clearing house 1) N COUNT If an organization acts as a clearing house, it collects, sorts, and distributes specialized information. The centre will act as a clearing house for research projects for former nuclear scientists.… …   English dictionary

  • Clearing house — Clearing Clear ing, n. 1. The act or process of making clear. [1913 Webster] The better clearing of this point. South. [1913 Webster] 2. A tract of land cleared of wood for cultivation. [1913 Webster] A lonely clearing on the shores of Moxie Lake …   The Collaborative International Dictionary of English

  • clearing house — n 1.) a central office where banks exchange cheques and other financial documents 2.) an office that receives and gives out or sells information or goods for several other organizations ▪ a clearing house for data on comets and asteroids …   Dictionary of contemporary English

  • Clearing House (EU) — Clearing House is an obscure working group in the European Union established after the September 11, 2001 attacks. It is composed of national security services under the Common Foreign and Security Policy who meet regularly in Brussels on counter …   Wikipedia

  • Clearing House — Clearing House, s. Eisenbahnabrechnungsbureau …   Lexikon der gesamten Technik

  • clearing house — ► NOUN 1) a bankers establishment where cheques and bills from member banks are exchanged. 2) an agency which collects and distributes information …   English terms dictionary

  • clearing house — An adjunct to a futures exchange through which transactions executed on its floor where trades are settled by a process of matching purchases and sales. A clearing organization is also charged with the proper conduct of delivery procedures and… …   Financial and business terms

  • Clearing House — An agency or separate corporation of a futures exchange responsible for settling trading accounts, clearing trades, collecting and maintaining margin monies, regulating delivery and reporting trading data. Clearing houses act as third parties to… …   Investment dictionary

Share the article and excerpts

Direct link
Do a right-click on the link above
and select “Copy Link”