posttrade

Post-trade refers to the set of processes that occur after a trade is executed to confirm, compare, clear, settle, and reconcile the transaction and to update positions and cash balances across market participants.

Key activities include trade capture and affirmation, trade matching, error resolution, novation and clearing by central counterparties, settlement through securities settlement systems, custody and safekeeping, corporate actions processing, and position and cash reconciliation.

Market infrastructure consists of exchanges, central counterparties (CCPs), central securities depositories (CSDs), custodians, and banks, supported by standardized messaging and data formats. Post-trade data quality and transparency are foundational for risk management, performance measurement, and regulatory reporting.

In derivatives, post-trade processes include collateral management, margining, valuation, dispute resolution, and close-out netting, in addition to the core steps. Across asset classes, settlement cycles and timelines vary by jurisdiction and instrument; many markets operate on T+2 or shorter cycles with ongoing reforms toward faster settlement.

Challenges include operational risk, fails and backlogs, incomplete or inaccurate data, and the cost of reconciliation. Trends focus on straight-through processing, automation, data standardization, and the use of distributed ledger technology and real-time analytics to reduce risk and improve efficiency.