Deposit/Withdrawal At Custodian - DWAC

What does 'Deposit/Withdrawal At Custodian - DWAC' mean

Deposit/withdrawal at custodian (DWAC) is a method of electronically transferring new shares or paper share certificates from the Depository Trust Company (DTC), which acts as a clearinghouse for settling trades in corporate and municipal securities. The Deposit/Withdrawal at Custodian (DWAC) is one of two ways of transferring between broker/dealers and the DTC, the other being the Direct Registry System (DRS) method. Both enable investors to hold securities in registered form on the books of the transfer agent, rather than in physical form. DRS is different from DWAC in that shares in DRS have already been issued and are held electronically on the books of the transfer agent.

BREAKING DOWN 'Deposit/Withdrawal At Custodian - DWAC'

The DWAC and DRS processes offer a number of benefits to investors. Being electronic systems, they greatly reduce the amount of time required to transfer and deliver securities, thereby significantly accelerating the settlement process for investors. They also eliminate the risk of losing physical certificates, as well as the higher transportation and handling costs associated with such certificates.

RELATED TERMS
  1. Chill

    Special restrictions that can be placed on a given security by ...
  2. Depository Transfer Check - DTC ...

    A check used by a designated collection bank for depositing the ...
  3. Direct To Consumer Advertising ...

    A form of marketing promotion that is aimed toward the end patient ...
  4. Custodian

    A financial institution that holds customers' securities for ...
  5. Stock Power

    A legal power of attorney form that transfers the ownership of ...
  6. Transfer Agent

    A trust company, bank or similar financial institution assigned ...
Related Articles
  1. Investing Basics

    What Does a Transfer Agent Do?

    Transfer agents maintain the records and documents related to shareholder accounts.
  2. Investing Basics

    Old Stock Certificates: Lost Treasure Or Wallpaper?

    What if you've discovered some old shares in bearer form? Follow our tips and find out what they're worth.
  3. Credit & Loans

    Transferring Credit Card Balances To A New Card

    Before you take advantage of that new credit card's 0% interest balance transfer offer, read our step-by-step guide.
  4. Investing Basics

    Investing in Foreign Stocks: ADRs and GDRs

    Depositary Receipts are easy ways to invest in foreign stocks, regardless of what part of the world you live in.
  5. Retirement

    How to Choose the Best IRA Custodian

    Finding the right custodian for your IRA means determining the sort of IRA you want. Then you can zero in on the ideal institution for the job.
  6. Personal Finance

    Alternate Methods Of Online Payment

    Paying by credit is one of the most common methods of payment for online shopping in the U.S. However, there are many other options worth testing out.
  7. Economics

    Inside National Payment Systems

    Investopedia explains: The global interconnection of U.S. payment systems makes commerical and financial transfers possible.
  8. Professionals

    What You Must Know To Pass The Series 6 Exam

    Learn what you need to know about the creation and components of a mutual funds to pass the Series 6 exam.
  9. Credit & Loans

    Shuffle Away Your Debt With Balance Transfers

    This option can save you big bucks, but only if you watch out for rates and fees.
  10. Taxes

    Understanding The Insurance Transfer-For-Value Rule

    If you are banking on your life insurance payout being tax-free, you may be in for a surprise.
RELATED FAQS
  1. What protects an investor’s interest in the case of terrorist sabotage, or act of ...

    Currently, most stock ownership is done electronically thru the combined effort of the brokerage firms and the transfer agents ... Read Answer >>
  2. I hold stock certificates in a company that just had a stock split. What happens ...

    The short answer is that a stock split will have little effect on the holder of stock certificates. In most cases when an ... Read Answer >>
  3. What is the difference between a custodian bank and a mutual fund custodian?

    Read about the difference between a normal custodian bank and a mutual fund custodian, why mutual funds use custodians and ... Read Answer >>
  4. Is this stock certificate worthless?

    I bought 50,000 shares of restricted common stock from a company in December 2015 and received a stock certificate. I then ... Read Answer >>
  5. Can I give stock as a gift?

    Stocks, bonds or any other securities can be transferred as gifts. Giving the gift of stock also has benefits for the giver. ... Read Answer >>
  6. Do small banks ever act as custodians?

    Examine why smaller custodian banks struggle to compete with larger custodian banks because of economies of scale and existing ... Read Answer >>
Hot Definitions
  1. Over-The-Counter - OTC

    Over-The-Counter (or OTC) is a security traded in some context other than on a formal exchange such as the NYSE, TSX, AMEX, ...
  2. Quarter - Q1, Q2, Q3, Q4

    A three-month period on a financial calendar that acts as a basis for the reporting of earnings and the paying of dividends.
  3. Weighted Average Cost Of Capital - WACC

    Weighted average cost of capital (WACC) is a calculation of a firm's cost of capital in which each category of capital is ...
  4. Basis Point (BPS)

    A unit that is equal to 1/100th of 1%, and is used to denote the change in a financial instrument. The basis point is commonly ...
  5. Sharing Economy

    An economic model in which individuals are able to borrow or rent assets owned by someone else.
  6. Unlevered Beta

    A type of metric that compares the risk of an unlevered company to the risk of the market. The unlevered beta is the beta ...
Trading Center