Clearing / Settlement
Features of Settlement
Settlement refers to concluding contracts by performing duties that arise from transaction contracts. For sellers, this entails the transfer of property rights and for buyers, this entails payment of charges duties.
Securities market trading occurs collectively, repeatedly, and by large quantities for which settlement cannot be attained smoothly using general trading performance methods. If millions of transaction contracts were to be individually settled by total amount every day, then settlement members would have to raise vast amounts of settlement funds and securities and would have to pay enormous settlement operational expenses. Furthermore, inconveniences due to settlement performance may occur and doubts regarding the confidence and trust in transaction conclusions may appear. In addition, if there is a breakdown in settlements, even continuous and multilateral trading on the securities market is difficult to establish.
In order for the immediate and swift process of settlements that form the foundation of the market, highly standardized and routine settlement methods and risk management tools are requested on the securities market. Therefore, the KRX, as both the market founder and the party concerned with the fulfillment of transaction contracts, regulates and operates specific matters related to settlement methods, settlement procedures, and treatments of settlement default.
- Contents Manager :
- Derivatives Market Division/Clearing & Settlement Rules & Regulations/Ju Mi Choi(051-662-2825)
※ Data and information on the KRX website are provided for the purpose of improving availability of information for investment, not for trading securities. In spite of the efforts made in ensuring the accuracy of data and information, the KRX recognizes that unintentional and chance errors and delays occur. The KRX is not responsible for any loss resulted from the investments made using the data and information provided on its website.
