The work of the Stock Exchange

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Monograph

Identifikator:: 1831284952

URN:: urn:nbn:de:zbw-retromon-225876

Document type:: Monograph

Author:: Meeker, James Edward http://d-nb.info/gnd/126597340

Title:: The work of the Stock Exchange

Edition:: Revised edition

Place of publication:: New York

Publisher:: The Ronald Press Company

Year of publication:: [1930]

Scope:: XVI, 720 Seiten; Illustrationen, Diagramme

Digitisation:: 2022

Collection:: Economics Books

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Document type:: Monograph

Structure type:: Chapter

Title:: Chapter XIV. Money clearance and settlement

Collection:: Economics Books

MONEY CLEARANCE AND SETTLEMENT 405 of the loss after the collection by it of the pro rata assessments against the original contracting parties. Odd-Lot Clearance and Settlement.—Thus far, two stub: born obstacles have prevented the expansion of the Stock Clear- ing Corporation into the field of clearing and settling odd-lot transactions. The first of these relates to the great office space which the work weuld require. It must be remembered that to a stock clearing system, the number of separate transactions rather than their size is the determining factor in operations. Now odd-lot transactions, although they constitute roughly 30% of the total shares sold on the Exchange each day,*® are probably even more numerous than round lot transactions. Thus, the undertaking to provide quarters for their clearance and settle- ment is a forbidding one, particularly in the Wall Street dis- trict—the most congested section in the whole world. A second obstacle consists in the factor of expense. Pre- sumably the economies effected by central clearance and settle- ment per share handled would be smaller with odd-lot than round lot transactions, while the overhead expenses entailed by the work would necessarily be heavy. Yet, as matters stand, odd-lot houses clear such trades for brokerage firms on their sheets without service charges.!” It is therefore somewhat dif- ficult to persuade the stockbroker to pay fees to a stock clear- ing house for clearance and settlement of odd-lot transactions which at present he obtains for nothing from the odd-lot houses themselves. Services of the Stock Clearing Corporation.—The specific benefits derived by the financial community from the several species of operations performed by the Stock Clearing Corpora- tion can now be summarized briefly. I. By supervising the process of comparisons, what amounts to an audit is made of practically all transactions ef- fected on the Stock Exchange, resulting in the speedy discovery 38 See Chapter IX, p. 252.

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