DEFINITION of 'Clearing Member Trade Agreement - CMTA'

An agreement by which an investor may enter derivative trades with a limited number of different brokers and later consolidate these trades with one brokerage house for clearing.

BREAKING DOWN 'Clearing Member Trade Agreement - CMTA'

When the position is consolidated, some brokers will 'give up' their position to the clearing firm. The positions should be cleared through the Options Clearing Corporation.

  1. Clearing Broker

    A member of an exchange that acts as a liaison between an investor ...
  2. Option Agreement

    1. A signed agreement between an investor who is seeking to open ...
  3. Executing Broker

    An executing broker is a broker that processes a buy or sell ...
  4. Commission Broker

    A commission broker is an employee of a brokerage company who ...
  5. Each Way

    A slang phrase used when a broker earns commissions from both ...
  6. Brokerage Company

    A business whose main responsibility is to be an intermediary ...
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  1. Where can I purchase options?

    In the United States, all options contracts go through one of several options exchanges. An investor must have an account ... Read Answer >>
  2. How can an investor profit from the increase in popularity of discount brokerages?

    Find out how investors benefit when brokerages compete with each other, and how discount brokerages are changing the market ... Read Answer >>
  3. How do I identify a stock that is under consolidation?

    Discover the three major characteristics stocks or securities exhibit when they are trading under a period of price consolidation. Read Answer >>
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