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Banking

Compensation par Contrepartie Centrale

A mechanism whereby a central counterparty (CCP) interposes itself between trading parties in derivatives and securities markets, guaranteeing the terms of a trade and reducing counterparty risk.

Quick answer: A mechanism whereby a central counterparty (CCP) interposes itself between trading parties in derivatives and securities markets, guaranteeing the terms of a trade and reducing counterparty risk.

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Quick answer

A mechanism whereby a central counterparty (CCP) interposes itself between trading parties in derivatives and securities markets, guaranteeing the terms of a trade and reducing counterparty risk.

Why it matters

Compensation par Contrepartie Centrale matters because it supports clear communication in Banking contexts for Financial Analysts, Bankers, and Traders. It also connects to aviation training and exam language such as CFA, ACCA, and FRM.

Editorial context

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Questions and answers

Questions and answers

What is Compensation par Contrepartie Centrale?

In this glossary, Compensation par Contrepartie Centrale refers to: A mechanism whereby a central counterparty (CCP) interposes itself between trading parties in derivatives and securities markets, guaranteeing the terms of a trade and reducing counterparty risk.

How is Compensation par Contrepartie Centrale used in finance?

In finance communication, this term appears in contexts such as: "La compensation par contrepartie centrale réduit le risque systémique en garantissant le règlement des transactions même en cas de défaut d'une partie."

Why does Compensation par Contrepartie Centrale matter in finance?

Compensation par Contrepartie Centrale matters because it supports clear communication in Banking contexts for Financial Analysts, Bankers, and Traders. It also connects to aviation training and exam language such as CFA, ACCA, and FRM.

Who uses Compensation par Contrepartie Centrale?

Compensation par Contrepartie Centrale is mainly used by Financial Analysts, Bankers, and Traders.

What category does Compensation par Contrepartie Centrale belong to?

In this glossary, Compensation par Contrepartie Centrale is grouped under Banking. Related pages in this category explain adjacent procedures, commands and operational concepts.

Where does this definition come from?

This definition is sourced from CFA Institute, IFRS Foundation, FASB (GAAP), Basel III Framework and published by Protermify Finance as a static finance reference page.

Definition

A mechanism whereby a central counterparty (CCP) interposes itself between trading parties in derivatives and securities markets, guaranteeing the terms of a trade and reducing counterparty risk.

Operational example

Central counterparty clearing reduces systemic risk by ensuring trades are honored even if one party defaults.

Localized term

Compensation par Contrepartie Centrale

Localized example

La compensation par contrepartie centrale réduit le risque systémique en garantissant le règlement des transactions même en cas de défaut d'une partie.

Definition language

English reference definition

Source

CFA Institute, IFRS Foundation, FASB (GAAP), Basel III Framework

Category

Banking

Exam relevance

  • CFA
  • ACCA
  • FRM

Target audience

  • Financial Analysts
  • Bankers
  • Traders

Related terms

Use the related links below to continue through connected finance terminology.

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