This one-day program provides a comprehensive overview of clearing houses, settlement systems, and depositories.The focus will be on trades for both securities and derivatives. As trading, clearance and settlement platforms globally undergo significant changes because of changing regulatory requirements, control, compliance and risk management considerations continue to be of utmost concern to market participants. Internationally, eroding profit margins for exchange clearing member service providers require increased attention to the management of costs and resources for both trading and operations. This program uncovers the activity that occurs in the local market exchange, clearance and settlement venues, as well as cross-border activity through international settlement systems including Euroclear and Clearstream.
The program content includes content covering the SWIFT network and standards as the backbone for cross-border securities trade processing. Changes are occurring at SWIFT that global market participants need to be aware of, and this program will include a discussion of how SWIFT is used in conjunction with local market settlement systems and what changes are expected in the near future.
Course Objectives
By the end of the course the participant will be able to:
- Explain the various participants and their roles in the domestic and international trading, clearance and settlement of equity and debt securities, and futures and options contracts
- Recognize how trade executions are fed from market places to clearing and settlement providers
- Analyze the infrastructure for exchange-traded and OTC activity in the U.S., including exchanges for equities and derivatives
- Review clearing houses including; the NSCC, FICC, OCC and ICE
- Describe how member requirements, margin and collateral funding in Central Counterparty Systems protect the safety and soundness of the financial markets
- Analyze the purpose and waterfall of risk for Default, Clearing, and Guaranty Funds
- Analyze the settlement systems provided for both Euroclear and Clearstream, including transactions for Bridge settlement between the two
- Identify and discuss major trends in the global trading clearance and settlement environments, initiatives for global standards, shortened settlement cycles, and new regulatory requirements
Prerequisites: Fundamentals of the Capital Markets Industry or Equivalent Knowledge
Program Level: Intermediate
Advance Preparation: None
Recommended CPE Credits: 7