Match each capital market clearing and settlement entity on the left with its primary operational function on the right.
- Depository Trust Company (DTC)Provides central safe custody and electronic book-entry ownership transfer of securities.
- National Securities Clearing Corporation (NSCC)Serves as the central counterparty for clearing, trade comparison, and netting of broker-to-broker equity trades.
- Options Clearing Corporation (OCC)Acts as the issuer and central clearinghouse guarantor for standardized options contracts.
Answer
Depository Trust Company (DTC) matches with safe custody and book-entry ownership transfer; National Securities Clearing Corporation (NSCC) matches with clearing, trade comparison, and netting of equity trades; Options Clearing Corporation (OCC) matches with issuing and guaranteeing standardized options contracts.
Each entity performs a distinct post-trade function: the Depository Trust Company (DTC) handles central securities custody and book-entry recordkeeping; the National Securities Clearing Corporation (NSCC) clears and nets broker-dealer equity transactions; and the Options Clearing Corporation (OCC) issues and guarantees standardized options contracts.
Step-by-Step Solution
Key Concept
Roles of Capital Market Infrastructure Entities (DTC, NSCC, OCC)