DEFINITION of 'Clearing'

The procedure by which an organization acts as an intermediary and assumes the role of a buyer and seller for transactions in order to reconcile orders between transacting parties.


Clearing is necessary for the matching of all buy and sell orders in the market. It provides smoother and more efficient markets, as parties can make transfers to the clearing corporation, rather than to each individual party with whom they have transacted.

  1. Actuals

    The physical commodity that underlies a futures contract or is ...
  2. Cash Market

    The marketplace for immediate settlement of transactions involving ...
  3. Carrying Charge Market

    A futures market where contracts with maturities further into ...
  4. Clearing House

    An agency or separate corporation of a futures exchange responsible ...
  5. Carrying Charge

    Cost associated with storing a physical commodity or holding ...
  6. Clearing Fee

    A fee charged by a clearing house for its services. A clearing ...
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