What is settlements?

Settlement (of securities) is the process whereby securities are delivered, usually against payment, to fulfil contractual obligations, such as those arising under securities trades.

This involves the delivery of securities to perform contractual delivery obligations. It usually also involves the corresponding payment of a purchase price. Usually settlement is preceded by trading, which involves entering into contracts of sale and purchase.

Although settlement is generally becoming quicker, in most markets a number of business days still elapse between trading and settlement. Settlement date for marketable stocks is usually three business days (T+3) after the trade was executed and for listed options and government securities it is usually one day. A number of risks arise for the parties during the settlement interval, which are managed by the process of clearing, which follows trading and precedes settlement. Clearing involves modifying those contractual obligations so as to facilitate settlement.

If I work in settlements what will I be doing?

Settlement involves the delivery of securities from one party to another. You will be working with computers checking order and solving discrepancies. It involves speaking with traders and stockbrokers, checking orders and chasing up settlement. Delivery usually takes place against payment, but some deliveries are made without a corresponding payment.

Traditionally, securities settlement has involved the physical movement of paper instruments, or certificates and transfer forms, nowadays all your work will be done on computer systems through an electronic clearing system.

Duties include:

• Ensuring all transactions are instructed in timely manor
• Ensuring all related queries are dealt within the required time frames
• Ensuring timely settlement of all transactions and reduce market exposure through monitoring of internal systems
• Monitoring markets through internal systems
• Investigating all failed trades
• Investigate all cash and position differences related to all trades
• Liaising with Brokers, Custodians, Investment managers on a daily basis

How do I get a graduate scheme / internship / entry level job or career in Settlements?

Obtaining a graduate scheme, internship or entry level role in Settlements can be very challenging and competitive – though very achievable by getting your application, CV, interview and general approach right. You can guarantee that ninety percent of applicants for Settlements roles will not know how to apply, so getting your application in the top ten percent makes things a lot more achievable.

Approaching the company in the right way will make all the difference. Combining the right approach with a strong interview (and in some cases assessment centre) writ a strong focused tailored CV will go a long way. Make sure you have gone through the free videos on this sight by entering your name and email address in the top right of this screen underneath the video. Once you have filled this in you will have instant access to everything you need to secure your career in Settlements.

Back to Back & Midlle Office

If you would like to add comments to this description, give any feedback or ask any questions about careers in banking & finance in this area please comment below