Central Counterparty Clearing House - CCP
- Central Counterparty Clearing House - CCP
- An organization that exists in various European countries that helps facilitate trading done in European derivatives and equities markets. These clearing houses are often operated by the major banks in the country. The house's prime responsibility is to provide efficiency and stability to the financial markets that they operate in.
There are two main processes that are carried out by CCPs: clearing and settlement of market transactions. Clearing relates to identifying the obligations of both parties on either side of a transaction. Settlement occurs when the final transfer of securities and funds occur.
CCPs benefit both parties in a transaction because they bear most of the credit risk. If two individuals deal with one another, the buyer bears the credit risk of the seller, and vice versa. When a CCP is used the credit risk that is held against both buyer and seller is coming from the CCP, which in all likelihood is much less than in the previous situation.
Investment dictionary.
Academic.
2012.
Look at other dictionaries:
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CCP — Cette page d’homonymie répertorie les différents sujets et articles partageant un même nom. Sigles d’une seule lettre Sigles de deux lettres > Sigles de trois lettres Sigles de quatre lettres … Wikipédia en Français
Clearing (finance) — In banking and finance, clearing denotes all activities from the time a commitment is made for a transaction until it is settled. Clearing is necessary because the speed of trades is much faster than the cycle time for completing the underlying… … Wikipedia
CCP — central counterparty (CCP) International Also known as clearing house. An entity that functions as a centralised repository for trades, typically in derivatives, which provides a guarantee that the trade will be fulfilled so that the parties… … Law dictionary
clearinghouse — clear·ing·house / klir iŋ ˌhau̇s/ n: an institution that arranges for payment of checks owed by one bank to another Merriam Webster’s Dictionary of Law. Merriam Webster. 1996. clearinghouse … Law dictionary
LCH.Clearnet — Group Limited Rechtsform Limited Company Gründung 2003 Sitz London Umsatz 1,36 Mrd. Euro (2007)[1] … Deutsch Wikipedia
