Pairing Off


DEFINITION of 'Pairing Off'

An illegal practice of a brokerage firm offsetting short and long positions between house accounts by collecting cash payments without physically delivering the securities.


Pairing off can occur only by brokerage firms colluding with one another. Proper settlement of short and long positions require the delivery of physical securities be made within three business days after the transaction. By settling these positions with cash payments, the brokerage firms are able to manipulate the market by trading non-existent shares and circumventing settlement regulations.

  1. Short (or Short Position)

    A short position is the sale of a borrowed security, commodity ...
  2. Long (or Long Position)

    1. The buying of a security such as a stock, commodity or currency, ...
  3. Parking

    A form of kiting shares that a brokerage commits by moving long ...
  4. Clearing

    The procedure by which an organization acts as an intermediary ...
  5. Kiting

    1. The act of misrepresenting the value of a financial instrument ...
  6. Black Money

    Money earned through any illegal activity controlled by country ...
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