Clearing Broker

AAA

DEFINITION of 'Clearing Broker'

A member of an exchange that acts as a liaison between an investor and a clearing corporation. A clearing broker helps to ensure that the trade is settled appropriately and the transaction is successful. Clearing brokers are also responsible for maintaining the paper work associated with the clearing and executing of a transaction.

INVESTOPEDIA EXPLAINS 'Clearing Broker'

Clearing brokers are the backbone of the securities market because their expansive knowledge ensures that the system is dependable and efficient. They must also research and confirm the information they are given and manage funds associated with the transaction.

RELATED TERMS
  1. Clearing Corporation

    An organization associated with an exchange to handle the confirmation, ...
  2. Primary Dealer

    A pre-approved bank, broker/dealer or other financial institution ...
  3. Crest

    CrestCo Ltd. is the central securities depository for the U.K. ...
  4. Clearing

    The procedure by which an organization acts as an intermediary ...
  5. Clearing Fee

    A fee charged by a clearing house for its services. A clearing ...
  6. Clearing House

    An agency or separate corporation of a futures exchange responsible ...
Related Articles
  1. Principal Trading and Agency Trading
    Investing Basics

    Principal Trading and Agency Trading

  2. Wrap Accounts: A Gift Of Advice?
    Bonds & Fixed Income

    Wrap Accounts: A Gift Of Advice?

  3. What is the haircut rate imposed by ...
    Trading Strategies

    What is the haircut rate imposed by ...

  4. Brokers and Online Trading
    Options & Futures

    Brokers and Online Trading

Hot Definitions
  1. Wage-Price Spiral

    A macroeconomic theory to explain the cause-and-effect relationship between rising wages and rising prices, or inflation. ...
  2. Accelerated Depreciation

    Any method of depreciation used for accounting or income tax purposes that allows greater deductions in the earlier years ...
  3. Call Risk

    The risk, faced by a holder of a callable bond, that a bond issuer will take advantage of the callable bond feature and redeem ...
  4. Parity Price

    When the price of an asset is directly linked to another price. Examples of parity price are: 1. Convertibles - the price ...
  5. Earnings Multiplier

    An adjustment made to a company's P/E ratio that takes into account current interest rates. The earnings multiplier is used ...
  6. Macroeconomics

    The field of economics that studies the behavior of the aggregate economy. Macroeconomics examines economy-wide phenomena ...
Trading Center