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Clearing
The matching of trade instructions from the buyer of a security with those of the seller of a security to facilitate payment for and receipt of the security.
Clearstream
Securities, depository and settlement system based in Luxembourg and owned by the Deutsche Bourse (formerly Centrale de Livraison de Valeurs Mobilieres or CEDEL).
Convertible security
A security that may be exchanged for another security under certain conditions.
Corporate Action
A corporate event affecting the shares of a company such as a stock split, tender offer, voting etc.
Corporate Agency
Services performed for an issuer of stock by an agent, such as transfer agent, paying agent etc.
Corporate Trust
Services performed for an issuer of stock by an agent, such as transfer agent, paying agent etc.
CREST
Electronic stock clearing and settlement system in the UK.
CUSIP
A unique identification number assigned to securities in the US by the Committee on Uniform Securities Identification Procedures.
Custody
Service provided by a bank in which securities and other assets are held on behalf of customers.
Custodian
Bank that provides custody services.
Depositary
A bank providing all agency services in connection with a depositary receipt program. The depositary bank issues and cancels the receipts which represent ownership of the underlying shares, distributes dividend payments and shareholder information, maintains the register of holders and arranges a custodian to hold the ordinary shares.
Depositary Receipt (DR)
A negotiable certificate representing ownership of one or more shares in a foreign company, that is quoted and traded in the currency of the market in which it trades, usually US Dollars. DRs provide a facility for investors outside the issuer’s home market to invest in the issuer’s security.
Depository Trust Company (DTC)
A national clearing house for the settlement of trades in corporate, municipal and mortgage-backed securities. DTC records, maintains, and transfers securities for participants. DTC participants include securities brokers and dealers, banks, trust companies and clearing corporations. The DTC system reduces the physical movement of certificates by permitting computerized transfers of book-entry securities.
Dividend Reinvestment Plan (DRIP)
A plan offered by issuers that allows investors to reinvest dividend payments in the shares or depositary receipts of the issuer without using a brokerage firm.
Earnings Per Share
The portion of a company’s profits allocated to each outstanding share of common stock. This figure is calculated after paying taxes and after paying preferred shareholders and bondholders.
EDGAR
The Securities and Exchange Commission uses Electronic Data Gathering and Retrieval to transmit company documents such as 10-Ks, 10Qs, quarterly reports, and other SEC filings, to investors.
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