Clearing Fee

AAA

DEFINITION of 'Clearing Fee'

A fee charged by a clearing house for its services. A clearing fee is most often associated with the trading of futures. Transaction fees often include both a brokerage fee and a clearing fee, but seldom include a delivery fee, since the actual delivery of the underlying asset in a future contract is rare.



INVESTOPEDIA EXPLAINS 'Clearing Fee'

A clearing fee is a variable cost, as the total amount of the fee may depend on the size of the transaction, the level of service required or the type of future being traded. The effect of clearing fees is felt by investors who trade several futures contracts in one day, since long positions spread the per-contract fee out over a longer period of time.

RELATED TERMS
  1. Commodity Futures Trading Commission ...

    An independent U.S. federal agency established by the Commodity ...
  2. Clearing House

    An agency or separate corporation of a futures exchange responsible ...
  3. Futures Market

    An auction market in which participants buy and sell commodity/future ...
  4. Futures

    A financial contract obligating the buyer to purchase an asset ...
  5. Clearing Broker

    A member of an exchange that acts as a liaison between an investor ...
  6. International Commodities Clearing ...

    An international clearing house for futures markets around the ...
Related Articles
  1. Fundamental Analysis

    Derivatives 101

  2. Investing Basics

    The Barnyard Basics Of Derivatives

  3. Options & Futures

    Trading Gold And Silver Futures Contracts

  4. Options & Futures

    Interpreting Volume For The Futures ...

Hot Definitions
  1. Turkey

    Slang for an investment that yields disappointing results or turns out worse than expected. Failed business deals, securities ...
  2. Conduit Issuer

    An organization, usually a government agency, that issues municipal securities to raise capital for revenue-generating projects ...
  3. Financing Entity

    The party in a financing arrangement that provides money, property, or another asset to an intermediate entity or financed ...
  4. Hyperinflation

    Extremely rapid or out of control inflation. There is no precise numerical definition to hyperinflation. Hyperinflation is ...
  5. Gross Rate Of Return

    The total rate of return on an investment before the deduction of any fees or expenses. The gross rate of return is quoted ...
  6. Debit Spread

    Two options with different market prices that an investor trades on the same underlying security. The higher priced option ...
Trading Center