DEFINITION of 'Out Trade'

A trade that cannot be cleared by the associated exchange clearing house because of discrepancies between the data submitted by both parties on the opposite sides of a transaction.

BREAKING DOWN 'Out Trade'

When an out trade occurs, it is returned to the two parties affected in order to have the inconsistency reconciled. Should the matter be resolved, the trade is resubmitted to the clearing house. If the matter cannot be resolved, it is then forwarded to the appropriate exchange committee for dispute settlements.

RELATED TERMS
  1. Clearing House

    An agency or separate corporation of a futures exchange responsible ...
  2. International Clearing System

    A trading system used when a futures contract transaction is ...
  3. New York Clearing House Association ...

    An organization established in 1853 to simplify the settlement ...
  4. Clearing Corporation

    An organization associated with an exchange to handle the confirmation, ...
  5. Clearing Broker

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

    The procedure by which an organization acts as an intermediary ...
Related Articles
  1. Investing

    What Do Central Counterparty Clearing Houses Do?

    A central counterparty clearing house facilitates trading in European derivatives and equities markets.
  2. Trading

    What Does a Clearing House Do?

    A clearing house is a third-party agency or separate entity that acts as a go-between for buyers and sellers in financial markets.
  3. Trading

    Principal Trading and Agency Trading

    Ever wonder what happens behind the scenes when you buy or sell a stock? Read on and find out!
  4. Investing

    Explaining Economic Trade

    Economic trade refers to the concept of parties voluntarily negotiating and exchanging goods or services.
  5. Financial Advisor

    Is Your Broker Ripping You Off?

    We show you how to resolve a problem without getting the lawyers involved.
  6. Investing

    Understanding Related-Party Transactions

    In business, a related-party transaction refers to a transaction where parties on both sides have a common interest or relationship.
  7. Insights

    What's an Exchange?

    An exchange is an organized marketplace where securities and other financial instruments are traded.
  8. Taxes

    Trade Properties To Keep The Taxman At Bay

    Like-kind exchanges can mean a much lower tax bill on real estate for savvy investors.
  9. Investing

    Party City Holdings: How It's Fared Since Its 2015 IPO (PRTY)

    Learn about Party City Holding's performance as a public company. Investors would have lost much more than the Russell 2000 Index by investing after the IPO.
  10. Investing

    5 Ways an Open House Can Actually Hurt Your Home Sale

    Open houses have long been a way to get exposure for a home that's up for sale. But it turns out it may be more trouble than it is worth.
RELATED FAQS
  1. How are arm's-length transactions determined by law?

    Determine if transactions are conducted at arm's length by checking if the parties to a contract are independent and transact ... Read Answer >>
  2. How do mutual fund trades clear and settle?

    Learn how mutual fund trades are cleared and settled, and when the money owed must be available or the proceeds due must ... Read Answer >>
  3. When is a share purchase marked as 'settled' by a brokerage?

    Understand the process of purchasing stock, including ordering, clearing and settlement, and learn when a stock trade is ... Read Answer >>
  4. Who uses bills of exchange?

    Find out who uses bills of exchange, why they are important in international trade and what happens when a bill is traded ... Read Answer >>
  5. What does "outrights" mean in the context of the FX market?

    The term "outrights" is used in the forex (FX) market to describe a type of transaction in which two parties agree to buy ... Read Answer >>
  6. Do I own a stock as of the trade date or the settlement date?

    When it comes to buying shares, there are two key dates involved in the transaction. The first date is the trade date, which ... Read Answer >>
Hot Definitions
  1. Cash Flow

    The net amount of cash and cash-equivalents moving into and out of a business. Positive cash flow indicates that a company's ...
  2. PLUS Loan

    A low-cost student loan offered to parents of students currently enrolled in post-secondary education. With a PLUS Loan, ...
  3. Graduate Record Examination - GRE

    A standardized exam used to measure one's aptitude for abstract thinking in the areas of analytical writing, mathematics ...
  4. Graduate Management Admission Test - GMAT

    A standardized test intended to measure a test taker's aptitude in mathematics and the English language. The GMAT is most ...
  5. Magna Cum Laude

    An academic level of distinction used by educational institutions to signify an academic degree which was received "with ...
  6. Cover Letter

    A written document submitted with a job application explaining the applicant's credentials and interest in the open position. ...
Trading Center